From working for a Big 4 auditing firm to launching his own tech startup, Abtrac founder and chief executive Edward O’Leary discusses the evolution of an industry over 30-plus years.
Like many business ideas, the foundations for the NZ-based tech company Abtrac came about while solving a problem its founders were facing.
But that was way back in the early 90s. How can a simple time billing solution not only evolve but fend off competitor after competitor and continue to thrive today?
Recently, we sat down with Abtrac founder and chief executive Edward O’Leary to reveal a little more of the history of this tech business, as well as what drives him to continue innovating into the future.
Below is a transcript of our interview with O’Leary.
What does your work journey look like and how has it led to Abtrac?
It’s been a long and winding road. After graduating, I actually started teaching maths up to scholarship level in an Auckland secondary school. After seven years I felt the itch to move on and applied for a job at (what is now) Ernst & Young, teaching people about PCs, which were just coming into the work force.
At EY I decided ‘if you can’t beat them you need to join them’ so I enrolled in an accountancy degree through correspondence at Massey University, in New Zealand. After another seven years I decided to launch my own business.
Initially I had some luck obtaining contracts over several years teaching at The University of Auckland, and with the then Institute of Chartered Accountants of New Zealand I wrote and presented several roadshow series on IT in business. Topics were IT and PC focussed, including one on Small Business Accounting Systems where I encountered a fledgling MYOB in the 1990s.
Abtrac evolved from those early days when we needed a time billing system for ourselves as our staff numbers grew.
What are you most passionate about in business and why?
The biggest buzz I get is from appreciative clients. It’s that ‘Ah-ha!’ moment when they see what Abtrac can do for them that I now most love in what we do.
Sometimes it’s during a demo with a prospective client. Sometimes it’s with a client who has been with us for years and they read a newsletter or ask us about some new feature they need, and I love it when we can say, ‘That’s been in Abtrac for years and here’s how it works’. That’s what drives us all here – helping clients do their job and them knowing we’re helping them.
We’re a business support company that happens to be writing and selling a most useful software package.
What can you tell us about Abtrac’s own journey? Why was it founded, who was involved and what initial challenges had to be overcome in order to launch it?
After a few years in business we had expanded to the extent that I was feeling increasingly out of touch with what everyone was doing. So even though I’d sworn I’d never use a timesheet again after my EY days, I had to concede defeat and after trying spreadsheets we decided to write our own system.
We evolved it over several years, giving it away to friends who encouraged us to go commercial with it. And we did so in 1999, launching it as Abtrac.
Our very first client was an accounting firm of three. They’re still using it, now on Version 6, with some 60 staff.
The initial challenges were that Abtrac was really a side-line item to our main revenue stream, which was bespoke software systems. One year, while putting together our forecast for the year ahead, an excellent question from our business coach arrived: ‘What if you could sell 10 times as many Abtracs?”.
That was the lightbulb moment that spurred our decision to go all in with a single system.
On our first foray into Australia we received a second piece of brilliant advice, which was to have users subscribe to Abtrac rather than buy it outright. That was the game changer.
The challenges since then have been the same as no doubt many businesses face: managing money and growth in an increasingly noisy marketing world.
Which current or recent trends have impacted your business and how will you be addressing these into the future?
When distilled, the underlying challenges remain pretty much the same over the years. People are people and they don’t change much from one year to the next.
Technologically speaking, the most recent big challenge was to move our desktop/server-constrained system into the cloud. To do this, we essentially took Abtrac off the market while we re-wrote it. We decided to go all in and make it entirely cloud-based, which has enabled us to survive and indeed thrive.
There are always trends being forecast and written about and we take each one as it comes. It’s a question of weeding out hype and ‘the next best thing’ from the reality of what will genuinely impact our clients. Then we decide if and when we can do anything about it at Abtrac.
How does your offering help small businesses? How many of them are there and in which industry sectors do they operate?
Most of our clients are white collar professional services firms. That is, they make their money by selling their time and expertise. They don’t have inventory nor bills of materials. They do recover out of pocket expenses or ‘disbursements’, but these are incidental to the value of the fees they invoice each month.
The second thing with our clients is they work on long-term projects with their clients. An architect building a school, or a consulting engineer on a flood assessment scheme, or a PR Agency working for a multinational will each be invoicing possibly millions of dollars on a single project across months if not years.
In these situations, Abtrac becomes the backbone system for the contemporary office, managing all the projects with everyone logging into it for project planning, generating proposals, forecasting, resourcing and staff scheduling, entry of time and disbursements, and of course invoicing.
The majority of our clients are in the AEC space, being architects, designers, consulting engineers, surveyors, planners, cost estimators and others around the construction and infrastructure development space. We also have PR agencies, accounting firms and others.
The reality is Abtrac is suitable for any business that is selling its time and expertise.
Tell us about your people. How large is your operation and what do you look for in A-grade staff members?
We’re a small business of five full-time and three part-time staff. We’re split across marketing and sales, and development with most of us wearing more than one hat. All our staff are A-grade members. And they’ve all been with us for many years.
What we look for in any new person is they have to be smart and they have to get things done. Easy!
Where to next for Abtrac? Any big plans or developments in the works?
We’re continually evolving Abtrac in response to changes in technology and the business environment.
We go for incremental improvements rather than major releases. Through this 2019 year we’ve released five upgrades with each one containing some 50-80 improvements. These include taking on board new opportunities as third-party packages such as MYOB make their own changes.
Each release also includes our own changes, be they new areas of functionality, API improvements or new reports.
The wonderful thing about the cloud is that we release an upgrade and ‘shazaam!’ thousands of people receive the one upgrade next time they log on. So there aren’t any major plans, just continual improvements based on our cloud platform.
What’s your vision of the future for the industry sectors you and your customers operate in?
It’s always risky making predictions about the future, but it’s clear that it will be technology driven. But that’s not new.
The old farm with six workers per every 50 hectares is now gone, as are the workers themselves. It’s now all about having one, laser-controlled John Deere being driven across hundreds of hectares.
The big thing now is AI, but in a way it’s just another step. AI is said to be something that will revolutionise not only how people work but also what they do. But if you look back a generation ago, there weren’t PCs and accountants and bookkeepers worked on real paper spreadsheets. They’ve already adapted to changes in their ways of working as technology such as MYOB has automated significant chunks of what was traditionally their job.
So, my vision is at best as murky as anyone else’s. As I said above, people are people and as a species we’ve got to where we are by adapting. I’m sure whatever eventuates, we will continue to adapt.
But I’m spending more time reviewing my Terminator and Matrix movies just in case.