Rene Lacerte learned the meaning of the word “entrepreneur” while sitting around the dinner table as the fourth generation of businessmen. His grandfather started seven companies, his father started five and his cousins founded Lacerte Software, sold to Intuit for $400 million in 1998.
Like what you see? Click here to sign up for Accounting Today's daily newsletter to get the latest news and behind the scenes commentary you won't find anywhere else.
Rene Lacerte worked for five years at Intuit, where he started what is now known as Assisted Payroll, which lets employers create paychecks in QuickBooks while Intuit handles their federal and state deposits and filings. Then, he and fellow Intuit employee Martin Gates went on to found PayCycle in 1999.
Now he’s embarking on his next venture as the CEO and founder of Bill.com, a Web-based cash management company in Palo Alto, Calif., targeting small businesses.
Originally named CashView for the real-time interactive calendar of scheduled bill payments that helps users understand their daily cash flow, he changed it to Bill.com at the start of this year.
The 40-year-old executive spoke about his plans.
Why Did You Start Bill.com?
I grew PayCycle from one employee to 100 and [dealt with] all the expenses that go with that. Billings go in and bills go out and no one really tracks or integrates all the transactions. I was always trying to decide who I was going to pay late to stretch out the payables and speed up the receivables.
Processing invoices can cost anywhere from $15 to $45, according to some estimates, and involve more than a dozen steps from creating to printing, mailing and depositing, all of which involve paper without Bill.com. We remove the paper, the mailing of the bill and the checks and route everything electronically while integrating all of the comments and processes with the transactions, and it costs less than $2 per bill on average.
How many customers do you have and what’s attracting them to you?
Less than 100 customers, and we’re growing faster than expected. Mostly it’s people who are fed up with paper. At PayCycle, I’d get a spreadsheet of bills I was going to pay and was gluing things together to figure out my cash position.
Who are your competitors?
QuickBooks Billing Solutions, Blinksale, Freshbooks and NetBooks (introduced in September by QuickBooks creator Ridgely Evers), but that’s new and needs a customer base. Competition is not about beating other people. It’s me against myself. My favorite sports are racing against the clock, like swimming.
What’s keeping Intuit from creating the same thing?
It’s not something they’re going to concentrate on. They’re not good at building services. Brad Smith (Intuit’s CEO and president as of January) is much more willing to take risks than Steve Bennett (who stepped down from that role in December).That means he’s also more willing to partner.
What are your integration plans?
We integrate with QuickBooks and QuickBooks Online. Next will be Peachtree, followed by Microsoft Office Accounting and Great Plains and probably Intacct. The [tax] accounting side too, with Creative Solutions being No. 1.
We have an engineer we just hired who a big part of his job will be integration because I don’t want to replace accounting applications; I just want to be the front office.
How do you plan to evolve to include collections services and online banking?
We’ll start with typical tools and focus on paying people electronically. PayPal does that, but it’s very consumery. We think we found something for that, and we’ll be introducing it over the summer.
How many people do you have on staff and how is the company doing financially?
We have 17 employees, including an executive team hailing from eBay, PayPal and Salesforce.com, are backed by $8.6 million in funding from DMC and Enterprise Capital. We’ll be profitable in January.
What challenges are you facing?
Getting customers to understand what the product is and why they need it. Twenty-five years ago, if you asked someone if they needed an ATM card, they’d say no. Now it’s indispensable. How do we make something new indispensable?
What have you learned from your experiences or those of your family?
Listen to your customers and your employees. Stretching out cash is key. Go with your gut instinct. Get jazzed about what you do and use that to help people. And don’t be afraid to fail.