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Blake Oliver: [00:00:05] I'm Blake Oliver. This is The Cloud Accounting Podcast and we are at ExpensiCon at the Borgo Egnazia in Puglia, Italy.

David Leary: [00:00:11] And I'm David Leary. And yesterday we attended a session, and I felt so strongly about it. When it was over, I was like, Oh, we have to get the presenter on stage to come on and talk about what he presented and the reason why. Historically speaking, we've known about Expensify for decade, decade plus. Accountants have never been happy with the support experience that Expensify and I saw a presentation yesterday that it's all changing. So I'd like to introduce Daniel Vidal from Expensify. His team is joining us because he was the person on stage explaining all these changes in the history. So do you want to explain the history of I know I summarized it kind of it wasn't great, but what is the history of how did you get to where you are and explain all these changes you're going to do to support?

Daniel Vidal: [00:00:52] Absolutely. Well, first off, thank you for having me. Thank you for helping us get the word out. As you already alluded to, I think that we've made massive changes. I'd say over the last 18 months. It's been a huge concentration of ours just internally to just improve our support, but then also get the word out. And getting the word out is almost harder than actually changing the support because we do have a reputation to pass for having a bit more hands off approach. And I think previous to where we're at and I'll kind of give the background as our business started to scale and scale incredibly fast, we added millions of users, but most of those users are actually employees. They're not necessarily accountants, they're not necessarily admins. And so they're asking millions of questions on a monthly basis for how to actually use our software. And it's not the extremely complex stuff, but it comes in a very, very high volume. And so we took a while to invest in the technology that we're very proud of today, and it's our concierge and that's what most people know our support is, is concierge AI driven support that's also backed by humans, but it's meant to build or to support the 99% of questions that employees are asking. Not really the 1% that the accountants are asking, but that's the only support that our accountants ever known. And I think that's what they were unhappy with, is that they were talking to an AI system that when they had complex issues, they weren't necessarily getting the help that they had. And so over the last year, we've been working on trying to provide best in class support. And so we've added a lot of different layers to support.

Daniel Vidal: [00:02:16] Some of those layers are account managers. And so we actually announced yesterday that every client of any expensify approved partner actually now has an account manager. Now that's separate from our direct acquisition client where they have to have at least ten active users to get assigned an account manager. But as a perk for being an approved member and a partner, we're giving everyone an account manager. So that's the first level of support that the direct clients can reach out to an account manager if they want to, and if the firms don't want the account manager to be the one managing support because that's part of the value added they have. They don't have to. We can configure that however they'd like to. We also have partner managers for every single expensify approved partner now where they have one of our team members that's similar to like me, it's someone that's been tenured for a very long time that knows how to strategize and grow these firms. And those each firm now has direct access to their partner manager as well as access to them in our chat tool as well, so they can actually collaborate in real time, just like it's our internal team. And a lot of our firms are utilizing this now really well, but they haven't necessarily started utilizing it across all of their accounts. So that's one of the main messages that we're asking people here at ExpensiCon is to say, Hey, create that relationship with your partner manager in all of your team members, because it's not only the firm leadership that gets it, it's every accountant within the firm has access to their partner manager.

David Leary: [00:03:32] And that's all done through the new Expensify app, correct?

Daniel Vidal: [00:03:35] Yep. That is all a collaborative tool where they can chat with them in real time. So what's the biggest.

Blake Oliver: [00:03:42] Challenge that you have? Running support at Expensify like mean. One thing that let me just add some context to the question. One thing that is always amazed me about Expensify is the scale that Expensify has reached with the relatively few number of employees. It's something that I tell. I talk about this with accounting firms and they say, how is that possible? I think average revenue per head is over $600,000, if I calculated it correctly, 700 more.

Daniel Vidal: [00:04:12] I don't know the actual numbers right now that we published, but I think it's been 1.1 at some point, 1.1.

Blake Oliver: [00:04:17] Million per employee.

Daniel Vidal: [00:04:19] Which David always is. The phrase is that we're gunning for oil companies pretty soon. So, I mean, that's.

Blake Oliver: [00:04:23] Like Google numbers, right? That's like Apple numbers. How did you like why did you scale in that way? Like, was that deliberate to keep the headcount low? Because most companies, when they get successful, they get money, they raise money, they just hire and higher and higher. And we've seen we saw that with like Facebook. Let's just hire people and they don't even have anything to do. I mean, we've.

David Leary: [00:04:45] Seen with apps in our own space, they, you know, 200, 300, 400, 700, 800, 2000 employees, and they barely have any customers. Yeah.

Blake Oliver: [00:04:54] So, yeah, what's the difference there? Is that a philosophical difference?

Daniel Vidal: [00:04:57] I think it is a philosophical difference. And I kind of touched on this yesterday, but it was a very hard decision that we had to do to say either we saw our business scaling, we saw these problems starting to happen and it was, do you want to go higher, 500, a thousand people to run your support and your sales systems, or do you want to figure it out another way? And we obviously went the other way, which meant investing in concierge, and that meant that our relatively small team had to put all of our energy into concierge and making that system work in real time rather than hiring more humans. And that made it bumpy for a while with our partners, with our accountants, with our clients, because they didn't have a direct contact, they didn't have the white glove service. And so that was a hard decision. Internally. We had to discuss it a lot and just with our partners. But it was a deliberate decision because I think that we want to build a company that we want to work at forever. As you can probably guess, a company of Expensify has already gone through big evolutions of just growing from when I started at ten employees to now 140.

Daniel Vidal: [00:05:56] And that's a change just in the company. But going to a thousand employees means that you don't know everyone anymore. You can't you don't collaborate with everyone anymore. And so I think that the expensify that we envision is a company that the employees right now want to work at forever. It's an extremely successful company that is also a massive cash cow. It's extremely profitable and it allows us to do things like ExpensiCon. It also allows us to do the internal things that help us with retention, like our offshores, where we spend three weeks abroad working from cafes together. And those those are the tools that keep us there. It's what has kept me there for 11 years. And I think that that company means you have to keep a relatively small headcount and we'll continue to grow. We're always hiring. We're always hiring engineers especially. But it is a very deliberate decision for the company that we want to work at.

Blake Oliver: [00:06:43] So I love I love this philosophy and I've always admired the leanness at which Expensify operates. But the the stock market doesn't seem to see it this way. Like, like why why has the market punished expensify stock price over the last What, you went public two years ago, right? Yeah. And it just it just keeps going down. What's what's up with that?

Daniel Vidal: [00:07:10] So the general market, I would say is gone down. When we went when we went out to go public tech was as hot as actually can be. When you look at pretty much every other large growth company that we went public with, it's had a very similar trajectory to the stock price. So I think because he went.

Blake Oliver: [00:07:27] Public at the top.

Daniel Vidal: [00:07:29] Correct? Yeah. Good timing. Public at the top, which was great for for the employees, great for just the excitement around going public. But yeah, it's been a it's been a brutal, a brutal couple couple quarters just like a couple years now at this point for tech, I'd say for high growth tech in particular, I think Expensify in particular, we we draft off of small businesses growing because we acquire you as a small company and you continue to grow. And so when those companies are no longer growing, which in the last year they really haven't been, then it also helps or it kind of hurts our growth flywheels. And we then depend on word of mouth. So the more customers and the more employees we have using our system, then the better our business just does in general. And so I think that's been another thing that as the market crashed, just in general, our business model is, is obviously still super strong, it's still super great, but it is impacted by the negative impacts of the economy as well.

Blake Oliver: [00:08:24] Because it's per user pricing, Correct. So these companies, these startups aren't growing super fast.

Daniel Vidal: [00:08:29] They're not growing. Some of them are shrinking because they're firing people. And I think that's that's one other great thing about Expensify is we haven't had to fire anyone yet, but we see our customers, we see what they're doing. They're not traveling as much and they're definitely not growing. And a lot of them are actually saying, hey, it's time to let go of. 1,020% of my workforce.

David Leary: [00:08:46] So I saw the loosely the and I think Dave mentioned it, the kind of using outsourced engineers to help build the new expensify. Now, if you have millions of customers and millions of support tickets coming in, are you using kind of outsourced tools and magic? Like how with 140 employees, like I've worked at QuickBooks, right? And there was 500 people in a building, maybe a thousand people in a building doing tech support with, you know, arguably similar numbers, maybe slightly bigger, but not it wasn't being done with 140 people. So how are how are you like, what are you doing with this? Like, how do you do this on the back end? Maybe pull down the curtain a little bit?

Daniel Vidal: [00:09:23] Yeah. So we have 140 internal full time employees. It might be more, it might be 150. Someone was telling me, I don't know the exact number, but somewhere around 150 I'd want to say on top of that, we utilize vendor relationships incredibly well. We started actually way back when with Smart Scan, where you take a photo of a receipt. We obviously have the same AI as everyone else where we pull out the date, the merchant, the amount, as most people know that have been in the OCR game. It's not 100% accurate. It's not even close. It's more like 80% accurate. And that means that if it's only working four out of five times, most of our most employees don't actually use it. One of the secret things about us. And so we kick those receipts that we can't get all the way correct up to a human. And we started with that. And that's that's what puts smart scan on the map. It's kind of what put expensify on the map is it's just the best receipt scanning app out there. And so we started utilizing vendors for that, same actually with concierge, and that was the first time we gained even more confidence.

Daniel Vidal: [00:10:16] So when someone writes in to concierge, we have that go to one level of vendors which we call first responders, and that's a team that is positioned all around the world and that's how we get that real time response. And that's like they can take questions like very repeatable questions. How do I how do I reset my support password? What's like a link for how to set up the QuickBooks? They know all of this stuff and our our AI engine can also predict it. And they say, yes, that's the right one. And then we have a higher tier team called Second Responders, and these are not Expensify internal employees as well. And they are pretty highly trained. They would be just like another layer of employees that most companies have. But that team is actually mentored and trained directly from our internal employees. And our internal employees are actually always creating more documentation and more resources for them to use. But it allows us to scale up and scale down the the support demand as necessary because we don't have to have the overhead, the overhead of having an internal employee.

Blake Oliver: [00:11:12] And so we haven't had to lay people off. Correct? Got it.

Daniel Vidal: [00:11:15] Correct. And that so that's powered our support system and we've done the same thing now with our sales. So if someone actually wants to get a demo, we call them onboarding specialists. They actually go to an external team that we train very heavily as well. And then we have now we're just starting to experiment with SaaS. So they're actually doing outbound as well. To add to our word of mouth engine.

Blake Oliver: [00:11:39] Had you never done outbound sales before?

Daniel Vidal: [00:11:42] No, we had never done any outbound sales today.

Blake Oliver: [00:11:44] That's incredible. Yeah, I'm trying to think, is there any other expense management or spend management tool that has not done the traditional boiler room? We're going to dial up CFOs and try to sell them on our software.

Daniel Vidal: [00:11:56] Not that I know of. Wait, don't know of anyone else. Yeah. In our space that has.

David Leary: [00:12:00] Not many apps that do. You guys have been word of.

Daniel Vidal: [00:12:02] Mouth in the business space. It is for an.

Blake Oliver: [00:12:04] Enterprise app to do that is very unusual. I mean that's that's totally unique.

Daniel Vidal: [00:12:08] Yeah and so we're we're excited and in particular. We're still we're still scaling up our SaaS and figuring out how it's actually going to work. But when the market has a downturn and your businesses aren't growing, that is a part of our business that we couldn't really control because we're like, Hey, businesses aren't growing anymore. Word of mouth is not working as fast as it was. This would give us another growth wheel to say, Hey, we can actually spend more money if we wanted to grow or whatnot. And so we're excited to at least start testing it out, which is which is really cool. But the contributor one that you're talking about is our latest addition to the business. And it's extremely powerful and we've thought about probably ten times in our support capacity with our current team. Thinking about doing that on the engineering side is even more exciting to us because we can just get to so much more of our our platform features that we want to build over time and perfect faster. And so those individuals, they're from all over the world. We had to write our our new Expensify product as an open source product. So it's all published. And we have, I'd say over I think it's over a thousand engineers that have contributed now to features being developed on new Expensify. So we create a job, it posts to the internet and says, Hey, I'll give you $10,000 to fix this bug or write this feature and it goes out there and then they submit proposals for how they would actually build it. And then our internal engineers are then reviewing the proposals, they're reviewing the code, they're reviewing the projects. And a lot of people are like, you're paying $10,000 for a job or $20,000 for a job. But when we think about what it takes to have that much engineering capacity is still just way more efficient to do it this way. So we're super excited for that because in the same way we fix support in 2 or 3 years time thinking about what the capacity of this team can actually do on an engineering side is very exciting.

Blake Oliver: [00:13:57] And that was a massive amount of work to basically replatform to an open source code base that you could then have thousands of people contributing to.

Daniel Vidal: [00:14:06] Yeah, yeah. It was had to be built on React Native. So it was a platform that we had to completely rewrite from scratch actually. Wow. And it's been really cool. We actually in, in March we hosted ExpensiCon X, which is a React Native Developer conference and we have our internal support and sales teams where we train them as well. But we flew in, I think we ended up having 130 people there that were some of the best React Native engineers. These are the people that are writing how to do React Native and now they are collaborating with us for the future of React Native because that's how, that's how impactful this program is becoming.

David Leary: [00:14:46] So if I'm an accountant, bookkeeper and either I currently have clients on Expensify and I need some help, like is it an email address website, is it a button in the app? Like how do I get this new support and help?

Daniel Vidal: [00:15:01] Great question. And so you could if you want. If you're already using concierge, you can write concierge and say, Hey, I want to talk to my account manager, but we've made it way easier now to also find your account manager or your partner manager in the in the web interface. If you go into Expensify, there's going to be a button called support just on your left hand navigation. And if you click that, your partner manager is going to be right there and every accountant should have it. If you don't have it yet, you need to make sure that you are expensify approved through the university so your account is marked as a approved accountant and a partner, and that would then auto assign you a partner. So you just go into the app, click support and you'll see a button in there with the face of your of your partner manager. You just write that and it opens up a DM with your account manager.

David Leary: [00:15:45] Right inside of that you don't have to go the new Expensify app, it's inside of the it.

Daniel Vidal: [00:15:48] Does take you to the new expense.

David Leary: [00:15:50] Expensify app it.

Daniel Vidal: [00:15:50] Takes you. So yeah, it's not a deep link. It's literally just going to open it up.

David Leary: [00:15:54] Another browser tab. Okay. Makes sense.

Blake Oliver: [00:15:56] Well, Daniel, thanks for taking the time to talk to us. It's been a pleasure and what a great event. Awesome.

Daniel Vidal: [00:16:02] Thank you so much for having me.

David Leary: [00:16:03] Thank you. What's your favorite thing about ExpensiCon? I think, well.

Daniel Vidal: [00:16:10] My favorite thing about ExpensiCon is going to be tonight's event. Actually, I think that I love watching our guests. I love having them come up to me and just tell me like, how over the top and how awesome is it because it creates such a special environment that for people that work really hard for us and with us as well. And so getting to reward them with some of these incredible events and just have them cherish these moments and then come and help push the industry forward is probably my favorite part. And tonight's tonight's The Wow event for sure. Perfect. Thanks.