While Crete is already highly active in the acquisitions space, having been named Accounting Today's
Crete CEO Steve Stagner said that the firms they're evaluating for potential acquisition aren't being selected necessarily for their size, location, practice areas or client list but, rather, their overall ethos and culture. Specifically, he said they're looking for accounting firms with an "entrepreneurial spirit" that are looking for a partner to help them scale up and evolve.
"The firms that are attracted to us are kind of hitting a wall … they're trying to figure out how do I jump over and access not just the talent but the tools and technology that I can use to unlock growth? And what's really amazing about our partnership is that we can provide that full suite of services — of talent, tools and technology with some of the most cutting edge and leading engineers in the world — to solve real problems inside their firms," he said.
How, specifically, Crete will implement AI at the firms they acquire will vary on a case-by-case basis. Rather than uniformly apply solutions to, say, client services or back-office administration, Crete will instead go in and see what can be automated or improved wherever it sits, with Stagner describing it as "solving bespoke problems for bespoke firms and doing it in a really cool way."
The end goal, though, appears to be giving these firms the ability to deemphasize routine compliance-based tasks and move further into advisory services.
"I think our mission is to try and help increase capacity so we can get to doing the things that humans do best, which is insight and advisory work, and at better quality … . We can go in and look at your existing tools and we can automate things," he said.
Anuj Mehndiratta, head of portfolio impact, data science and product with Thrive Capital, added that there is a need to "approach these partnerships with a lot of humility" and so Crete is not planning to come and immediately start dictating terms.
"So what we like to say is we are here to actually go and experiment with you, to go and develop solutions alongside them for whatever those pain points are," he said. "And the beauty of this industry is that there are obviously patterns that we can start to abstract over time, and then we can take those modules that might be designed with one of the specific firms in our platform and go and share it with the others and say, to the degree that this would be really helpful for your business as well … Think of this as an opt-in model, I think it's really important for us to say, 'We're not going to force anything onto you.'"
While the specific solutions offered will depend on circumstance, there is a good chance they will be offered in cooperation with OpenAI, the company behind ChatGPT. Mehndiratta said Thrive Capital is one of the largest investors in OpenAI and has worked with them for a long time, which gives him confidence in their technology.
"We have accountants, workflows, all these benefits that OpenAI can benefit from, but also we can benefit from their technology. Bringing those things together is what we've been doing: taking that cutting edge technology and leveraging it in the context of accounting workflows, whether it be voice capacities to help with customer relationship management [or] data transformation capacities from models to help with workflows and drive productivity," he said, adding that this will also help OpenAI refine its own product experience.
He said the goal is not trying to drive revenue for OpenAI, though: "I think obviously that would be a byproduct of this." The real goal, he said, is to deliver the best experience and the best product to their accounting partners. This might involve working with OpenAI to build custom technology for them, partnering with other technology companies, or having Thrive's engineering team build a solution from scratch.
"We're open-minded to what that should look like, and we kind of have one North Star, which is ultimately, we want to be able to make our accountants abundantly available, but also make our accountants deliver the best experience for their customers, and we believe technology can help us do that," he said.
Stagner said that this initiative is not just about data and technology, but creating a firm that is well adapted for the challenges of today's economy, and prepared to face tomorrow's. With this in mind, the initiative also involves education, training and development programs to further grow capacity.
"We're not looking at AI as a silver bullet here. What we're trying to do is build and help transform firms … So we're [also] investing in learning and development programs and education programs to help the next generation. We're investing in our global delivery of resources all over the world to help support and add capacity and quality. We're investing in a lot of other areas on top of workflow automation. So it's really a combination to me. My general belief is it's [about] talent, tools and technology," he said.
