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Reckon is Not For Sale and Other Stories

I attended the 2016 Reckon Accredited Partners conference last weekend and received a full immersion of the position of Reckon, where it was going as a company and what it had delivered or was delivering on its various accounting software platforms.

Clive Rabie – CEO of Reckon was scheduled to participate in a ‘By the Fireside Chat’ at the conference however he was in the US working on the Reckon acquisition of SmartVault – see more below on this and  was replaced by Managing Director, Sam Allert. The first question posed to Sam was ‘Why does the Reckon share price continue to fall’. Sam gave a brief overview of the events last year surrounding reports in the national press that Reckon was an acquisition target. The official version is that Reckon approached Macquarie Group first, to understand why its market capitalisation was so low and subsequently asked shareholders to forgo dividends so that profits could be reinvested to fund R&D operations. The second action  caused the share price to fall even more and fuelled the rumours of a takeover. Sam stressed that Reckon is alone in accounting software companies to be profitable – (Saasu is profitable but is a private company) and pay a dividend (a dig at Xero who generates increasing losses every year) and no sale is on the horizon. So with that sorted – on to the software.

Reckon One – After a few years of anxious waiting the Payroll module is about to be released – tomorrow!. Whilst the beta version of the module looks to be fairly comprehensive, disappointingly the initial release will not allow for integration to Jobs or Classes. The Time & Expense module in Reckon One is currently very limited as it cannot capture employee labour costs, I had hoped that Reckon One would have a major point of difference from its competitors by providing this function – but not yet. Another missing feature from Payroll is ABA files – this feature is due for release shortly but will be for suppliers and employees in a combined file. An Employee Portal will be available in the Medium version of the module which will cost $5 a month or $3 a month for the Lite version – both with unlimited employees – definitely a point of difference here.

Eighteen functional releases were delivered into the product last year and there are now more than 30 third party products that use the API to integrate to Reckon One (being a true cloud product – this process is much easier than in the Hosted version – see below) So both the depth of functionality and the User Experience is gradually improving. The mobile app  now includes supplier bills as well as customer invoices for those that use the product on the go.

The product remains somewhat lightweight in comparison to Xero, QBO and Sage One, however Payroll  has for some time been a significant hurdle to clear. Once the first release is delivered, resources will be freed up to work on other areas and with a Payroll module, the product becomes a more viable option when selecting cloud based accounting software and the potential increase in subscribers should increase the pressure for greater functionality.

Reckon Accounts – The majority of R&D effort over the past couple of years has been channelled into Reckon One so only a few goodies were released in the 2016 version of Reckon Accounts (coming next week for Hosted). This included:

  • ABN validation.
  • Webmail support for Hotmail, Gmail and other providers.
  • Enhancement of functionality in Bank Rules including ability to set classes on a rule and add a rule whilst in the bank feed.
  • Additional  SuperStream functionality.

Reckon Accounts Hosted – Sometimes I am surprised that there are any customers remaining on the product, it has been so plagued with horror stories. Downtime continues to be an issue despite the migration to AWS and Reckon experiences challenges in supporting the 3,000 or so people that log in over a short period in the morning. Resources and servers are being thrown at the issue and improvements are being made to the file server architecture.

Whilst the APIs required for third party apps to integrate to the product are now available and there has been some take up, technical issues continue to plague deployment making it a long road for some vendors. The increasingly popular and highly functional time sheet app TSheets for example  has been unable to integrate with Hosted although it is available on the Desktop version (It is also available on QBO and Xero but not MYOB Essentials or Saasu).

SmartVault – Earlier this year, Reckon acquired US-based SmartVault – an online document management system which will sit alongside the existing document management system; Virtual Cabinet which offers an enterprise level document management and portal solution to businesses and accountants. Whilst this is an important strategic acquisition for Reckon complementing Virtual Cabinet, it also enables Reckon to provide a similar solution to Xero in that documents can be directly linked to transactions in Reckon Accounts and stored in SmartVault. Other business documents can be stored and shared as well but the link with Reckon Accounts will be a useful feature . (Again Reckon Accounts Hosted users – don’t hold your breath – whilst SmartVault is a cloud based service – it does not integrate with Reckon Accounts Hosted!).

The message is – Reckon remains open for business (although share price continues to decline), it is continuing to deliver more features and functionality in its accounting software products, whether or not Reckon One will be a product to be taken seriously remains to be seen; I am just waiting to test out the Payroll module in Reckon One tomorrow and will let you know how I go.

 

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9 comments on “Reckon is Not For Sale and Other Stories

  1. Interesting Margaret. Thanks for the reports.

  2. Thanks Margaret very interesting reading.

  3. Great articles, Margaret. So good to see you back on the blog.

    What exactly are the problems with Hosted? It sounds like more than an issue of throwing more server resources at it, as that’s pretty easy to do in AWS.

    Did you get a sense of how many partners are actively selling Reckon One?

    • Hi Sholto – Reckon has a lot of very loyal partners who are committed to the product and accept with little complaint any shortcomings by Reckon. With Hosted – there are frequent drop outs but there is often a problem with logging on in the morning – too many people being funnelled through a bottle neck leading to time out issues. Now there aren’t huge numbers on Hosted compared to say Xero but the issue remains despite servers being brought on earlier each morning to manage the 3000 rush.
      As for selling Reckon One – really no idea, and no idea how many current subscribers

  4. And what was the mood like? Were people happy with the explanation for the falling share price?

    • I don’t think there was too much interest in the bigger picture – the share price continues to fall. Clive Rabie and Greg Wilkinson apparently both bought in

  5. Very colourful Margaret.

    I am fairly certain I was at the event, no that’s right, I was the co-presenter of the Hosted API session, and I am pretty sure I didn’t use the phrase “technical issues continue to plague deployment”. A bit of poetic licence there one feels, but hey, it’s certainly a headline grabber.

    Currently we have 3 devs live and 30+ more developing. Is what we are doing quite technically challenging, that is, a RESTful API around a desktop SDK penetrating a hosted Windows environment? Sure. SInce we released in late October does that mean we are early on in this lifecycle? Most definitely. Are future updates planned? Yep. Of course they are. Can you compare the process in any way to the Reckon One API? Absolutely not. In fact, can you compare Hosted to Xero; definitely not. It’s like apples, and well… monkeys.

    So we are friends right? We share Facebook content. So I’m more than happy to read your blogs and have a chuckle, and therefore I also know you won’t take offense when I disagree with you.

    We have 33,000 logins on hosted now, not total data file users, if we counted those we would be nearer to 100k, but who counts those in this space? It would be kinda over exaggerating if a vendor quoted thousands of users, many of whom were dormant or occasional users. Wouldn’t it? Anyway, I digress…

    I am talking concurrent logins, and that’s doing pretty well I’d Reckon(TM). So it may not be your cup of tea, but it obviously serves a purpose for a great deal, so let’s remember that.

    I don’t like tea personally, and I do sing the praises of a good bean, but I certainly don’t go putting the boot in to tea drinkers every chance I get. All I ask is the same in return.

    Kindest regards,
    Jason

    • Hi Jason – thank you for taking the time to respond. I always appreciate vendor responses to balance my enduser interpretation. Please note my comment in relation to the Reckon Hosted/API issue ‘technical issues continue to plague deployment’ was my interpretation of the situation. As you say it is technically challenging to deliver in that environment. unfortunately whilst I understand that, the majority of users don’t take on board legacy issues, they just see and compare what other vendors can deliver.

      • Perfect Margaret. So users can compare apples with apples here is a very short list based on your most reviewed SME accounting applications for the Australian market:

        Application: Reckon Accounts Hosted
        Comparison Product: None
        Closest Comparison: MYOB AccountRight (in terms of functionality, not technology or pricing model)
        Closest API Comparison: None

        Application: Reckon One
        Comparison Products: MYOB Essentials, QBO, Xero, Sage One, Saasu
        API Comparison: As above

        For the technical, is the API a RESTful web service, using JSON or XML, OAuth 1 or Oauth 2.

        For the record, both of our APIs utilise a RESTful web service, JSON & OAuth 2.

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