Constantly innovating in a bid to outdo each other, the major cloud accounting software providers have created platforms that many a business owner and their accountant admit they now can’t live without. However, the rise of these services also means that accountants are inundated with mountains of data from their clients, which can be hard to manage and properly analyse.
It’s this problem that Queensland startup Panalitix is looking to solve. Cofounded by Rob Nixon and Colin Dunn, the startup has created a digital membership community for accounts worldwide, connecting them with tools and information to help them better manage their own businesses and in turn, those of their clients.
The idea for the startup came out of decades working in the industry and seeing common problems: Nixon and Dunn first met in the 90s, working at the same accounting firm.
They both went on to start their own accountant consultancies, with Dunn then joining Nixon’s new project, Proactive Accountant Network, in 2008. The new company consulted to accounting firms and sought to bring the industry together into a cohesive community with resources and events.
Identifying the rise of cloud services a few years ago, Dunn and Nixon decided the business needed to evolve and created Panalitix in 2014. Having poured their own $6 million into the new company, the cofounders’ goal is to help 10,000 accounting firms help two million small and medium enterprises.
Nixon explained, “We’ve been coaching and training accounting firms for over 20 years and we couldn’t scale that business. We saw an opportunity to help our clients through technological disruption, so we pivoted the business away from a services-based business to an online provider. That way we can service more firms on a global scale.”
The $1,000 per month membership fee for top tier members gives firms access to a handful of apps, an e-learning platform, and personal coaching support from the Panalitix team. Through its content marketing software, Panalitix also connects firms to their clients by allowing them to distribute content and methodology with their own branding.
To help members manage the mountains of data coming in from their clients, Panalitix gives members access to client monitoring tools including a firm dashboard, giving them a quick snapshot of how their clients are tracking through the tracking of real-time data. All clients are displayed on the single dashboard, with their targets vs actual performance presented.
Accountants are then able to click through to an individual client dashboard, where they can view set up KPI targets, view alerts, and track their performance, while a trends analysis dashboard showcases month by month performance of each key driver of revenue, profit, and cash flow.
These features look to help accountants be proactive in their work with clients rather than reactive, effectively helping clients identify and rectify potential issues before they happen.
According to Nixon the e-learning platform, which covers how-to content for things like workflow, sales, marketing, serving, pricing, and business advisory, has been the most popular aspect of Panalitix, with firms given access to over 120 courses that have been curated over a 10 year period.
Given there are no courses focused around legislation or regulations, Nixon said usage is quite uniform across the board from country to country, with the startup active in nine markets.
Panalitix has been able to build up its membership base, now at 750 firms, over the years through seminars, webinars, and one on one online meetings. These events give prospective members a taste of the platform rather than a free trial; Panalitix has a global database of 600,000 accountants on board.
The startup made an interesting decision when the time came to raise capital: rather than going down the VC path, it decided to effectively crowdfund, giving existing clients the opportunity to become investors. Jumping at the chance were 85 accounting firms and a number of their clients, with a total of 140 investors raising over $7.5 million.
“We keep the investors updated every six to eight weeks on progress and they help with testimonials, introductions, and feedback. Only one of our clients investors sits on the board,” Nixon said.
Over the next year, Nixon said Panalitix will look to raise a further $7.5 million from clients and other sources to fuel expansion and list on the ASX. Its aim is to double the number of member firms to over 1,500, with a focus on expansion around Australasia, the UK, and North America.
Image: Rob Nixon. Source: Supplied.