Michael Wood, of Receipt Bank, on disrupting bookkeeping and what VCs look for before investing
At UKTN, we’re always keen to shine a light on those who make up the UK’s thriving tech community.
We spoke with Michael Wood, a director at Receipt Bank, a bookkeeping platform for SMEs which recently closed a $50m Series B.
Wood spoke about how Receipt Bank came to be and the challenges facing other entrepreneurs wanting to disrupt the bookkeeping sector.
Tech vertical: FinTech
Funding: $65m
Staff count: 200
Location: London HQ
Founded: 2010
Q: What made you set up Receipt Bank?
Ten years ago I ran a small business and did my own bookkeeping. My accountant at the time suggested I wasn’t very good at it so I decided to look for something that would help me. I found Receipt Farm, which took my receipts and invoices and extracted the data. The problem was my accountant couldn’t access the data and I couldn’t import it into my own accounting software. I called them to see if they had plans to address this and while they thanked me for my feedback, they told me they were closing down. So I bought the company. I knew that by solving the problems I’d identified, by being accessible and able to integrate with other accounting software, there was a great opportunity. From that telephone conversation Receipt Bank was born
Q: What’s your background? What were you doing before?
I wouldn’t say that I followed the most natural path into this line of business – I started off studying Zoology, before working as a strategy consultant.
Q: Who are your competitors and what sets you apart?
We are working with accountants and bookkeepers to automate bookkeeping. Not a single small business around the world is yet on fully automated bookkeeping. This means that our competition is very much paper, Excel and inertia! We are constantly evolving, challenging the industry to be better and developing new ways to reduce costs and fully realise the benefits of bookkeeping and real-time accounting. To spearhead this change we have to have the right people in place and this is exactly why we have the largest AI team working on bookkeeping in the world.
Q: What are the main entry barriers for companies wanting to operate in the same market as you do?
Our technology has taken several years to develop and we are constantly working on making improvements. To enter the bookkeeping market would require a business to have deep knowledge of the industry, the necessary technology and the ‘secret sauce’ to acquire clients cost effectively.
Q: What has been the most challenging part about setting up your firm?
A lot of our business is change management – helping firms of accountants & bookkeepers to adopt new technologies. We have been revolutionising accounting for small businesses since our foundation, so at every stage we have had to help firms change the way they work for the benefit of both them and their customers. This is never easy though – change is always hard!
Q: What has been your business highlight to date and why?
A clear highlight has been opening offices around the world, and then to achieve such rapid growth in those new countries, winning local awards for the quality of service we are delivering. We have offices in France, Australia and the US, and in each of these markets we are attracting a lot of interest and expanding at pace. Seeing the team grow on a global scale and continuing to challenge the industry in different parts of the world is a ringing endorsement of the business’ success.
Q: From your experience, what do investors look for in an entrepreneur?
All investors have different tastes, insight and knowledge so they have very personal preferences. But in broad terms investors need three things: they want to know that you have a vision for the future, that vision needs to agree with theirs and then they need to see that you have the ability to execute against it.
Interested in hearing from other UK tech entrepreneurs? Check out our ‘Founder Interviews‘ section.