395 The Fall of Bench + The State of Productized Accounting

Another one bites the dust. And man, has accountingdom been savage to Bench. Bench, the productized bookkeeping platform that went underwater and then got acquired. And it was just, just the best opportunity for all of us to kind of dance on the grave of another VC backed accounting company. I worked a bunch with Bench, actually knew the company pretty well. So I can share my thoughts today on, on kind of the downfall of Bench, but also productized bookkeeping and accounting in general as it bumps up against like professional accountants and the firms that we run. How should we feel about this headed into 2025? Come on in because stuff is changing. Like AI is making this a little more compelling productized bookkeeping, but it's also making my accounting firm more efficient. Okay, let's talk about it. Okay. If you weren't familiar, Bench, they were a bookkeeping outfit in Canada that were kind of positioned as sort of a, a scale like productized bookkeeping solution. Like they, they kind of frame it as software, but there's at the end of the day, there's bookkeepers there doing the work. So unlike a QuickBooks or a Zero, bench was not purely a platform, though they did have their own ledger platform, which is actually pretty unique. Most of the productized bookkeeping or accounting solutions out there, what are, are, are just platforms that use a whole bunch of other platforms and they will use QuickBooks and Gusto and all these different things and pull that data together into a centralized place. Bench, on the other hand, Bench actually built their own accounting ledger in house, which is kind of wild. And when you worked with Bench, you were paired with a Bench bookkeeper. Now they were based in Vancouver and Bench was kind of, they were founded in 2010, something like that. Almost ran out of money in 2012. There was a whole thing back then. But they are probably the longest running productized accounting solution that's been out there. Like we've seen other companies like Scale Factor kind of crash and burn, like raise a pile of money to say hey, we just automated accounting. And then before you know it, they're gone. And so if you had to put your finger on who's made it the longest, is there anyone that ought to have been closest to making this a sustainable business? Kind of ought to be Bench because they did it for over a decade. Right. So the whole Bench model was built kind of on, on three these thesis one onshore, everybody. Bench was onshore to everybody, Bench was onshore. But a little more on that in a minute to centralizing bank rules. So having kind of a centralized classification engine that all of the companies could benefit from rules rather than what ledger platforms do today, where I set up a bookkeeping file for a client and I create bank rules there, but those rules don't work in any of the other files. It's like, totally siloed the way that we do classifications. Bench. Why they built that platform in house was so that they could have their own sort of centralized classification engine that you could use across all companies. And then third, kind of the third thesis that bench was built on was the notion that you get the books in the door and then you ultimately make money through adjacent stuff, which is the same thing that accounting firms do. It's very hard to make money just doing bookkeeping. But as we've talked about a lot on the podcast, for me, getting the books in house was what led to, like, being able to do advisory around cash and all these other things that paid much better than bookkeeping to the degree that, like, if we were taking on a client and it looked like the only thing they would be interested in longer term was just bookkeeping, we wouldn't take that project on because it was hard to make money on bookkeeping. Now what most people see bench as is kind of the poster child of cheap books and the fact they stand up a landing page. That said, lately it was, I think it was 250 per month if you buy it for a year, but $300 a month if you pay month to month. But that was like the entry level bench pricing. All of these websites just show, like, the bare minimum. They don't show the median, like, what most people are actually paying for that service. QuickBooks Live Bookkeeping is the exact same way. Their. Their starting price is 200 bucks a month. But a very, very small percentage of people actually pay that. Think about, think about TurboTax and like, the way that they kind of nickel and dime, like, costs for states and additional forms and all that stuff. These services are the same. So bench was kind of built on three things. The notion that onshore was the way to do this, that centralized bank rules would drive a big level of efficiency. And third, that you could make money by doing stuff besides books once you got them in the door. Now a word on their approach to staffing. So they're based in Vancouver, British Columbia. That is basically, they would pay college grads local to them in Vancouver. Vancouver salaries are deflated. Is that the right way to say. They call it the sunshine tax. Basically, people will take less money to come work in Vancouver because it is. There's more Sunshine than most of the rest of the places in Canada, which if you've ever been to Vancouver bc, like if that is peak sunshine for you, Canada, take a look south. I'm just saying, I mean, immediately south, things have gotten pretty weird. But if Vancouver B.C. is the most sunshine you can find, it's time to broaden your horizons. Okay, take that fuzzy little cap off and look around. Anyways, Bench would hire new college grads. Fresh, fresh cheeked baby accountants. They pay him 30 grand a year USD because you could do that there. At one point I was told by someone inside Bench that the average lifespan of a Bench bookkeeper was eight months. Eight months. EIG H T eight months. And that was their, their version of onshore hiring. Because most bigger groups like Inda Narrow, you know, Bot Keeper, so many examples of how most groups will turn offshore, turn to the Philippines. But Bench was like, nope, you're going to have an onshore bookkeeper and you're actually going to be able to build a relationship with them. If you look at QuickBooks Live Bookkeeping, for example, last I knew, they have a pooled approach to serving their customers so that when you come and talk to somebody, in all likelihood it's not going to be the same person you talked to previously Bench. They actually give you a person so you come to the service. Yes, it is very productized and it feels like software, but there is a specific person that oversees your books, actually does your books. This is as of maybe five years ago, let's say. So I wouldn't think it's changed since then, but that's kind of how up to date my information on Bench is. It was a real person. There was a picture of them there. You could have phone calls with them, you could message with them. It was like an actual bookkeeper because it was an actual bookkeeper. And on average bookkeepers at Bench would be responsible for managing 40 to 50 clients each. High achievers were able to do more than that. But you can understand how if you are a customer of Bench, the notion of building a relationship with your bookkeeper when they are turning over every eight months, that's really, really hard. So what Bench ultimately was, was like a staffing machine. Like they had an insane pipeline of hiring a huge number of bookkeepers every year. A very small percentage of them would stick around. And this is what onshore bookkeeping at scale looks like. Is it really any better than Offshore? I think you could probably say, like potentially from a client experience standpoint, maybe. But here's the thing, like even at 30,000 a year USD, which is, I mean, in, in the land of the free, you can't pay anybody to do anything for 30 grand a year. But if the bet is that a new college grad in Canada who you can talk with as a native English speaker and all that, if the bet is that that's a more premium experience than hiring offshore, I don't know if that holds up anymore. Because you know what you can get for $30,000 a year USD offshore? I mean, that's like, that's a CPA, like, that's a very high level offshore hire. And I would hope that most of us are not so xenophobic to prefer a new college grad bookkeeper that doesn't know anything to somebody who's speaking English as a second language that really knows their stuff. Honestly, that's kind of my take on, on like the approach Bench had here. Bench, they committed to this back in 2010. The world is very different back in 2010. I mean I would have been, I was, let's see, that was about, that was third grade for me. So that bet I don't think has held up, but they also stuck around for like 15 years. You run any sort of accounting firm for 15 years, you're going to see some things. And so there's actually like, there are a lot of things about how Bench ran that I liked the notion that you had an actual person you could build a relationship with. And it wasn't set up to be this scale pooled model where like you're never going to actually talk to anybody with expertise. The person you're talking to on the other end is your actual bookkeeper that ought to have actual bookkeeping expertise. And honestly I like that. Now my arrangement with Bench, which if you listen to the podcast, I've shared this before, but in short, I launched a cast practice that we grew super fast to. I think it's about one and a half million ARR within about 18 months. And that involved bringing in a whole bunch of different types of work, some of which was going to be good long term, a lot of which was not. And as we matured that sort of managed accounting, sort of outsourced accounting, part of our business, we started to look at projects that we could deprioritize and off source to outsource to somebody else to get that work done. And where we ended up drawing the line was more or less for engagements under a thousand dollars a month or so. We built a partnership with Bench where Bench's bookkeepers would do the bookkeeping for those smaller projects and we would come in and review them, you know, once a quarter or something like that. Now, my experience with Bench was vastly, vastly different to the experience a random small business would have with Bench just rocking up to him one day. Because that hiring machine that we talked about, the fact that they're hiring over a hundred bookkeepers a year, guess who got the cream of the crop every single year? Who could cherry pick the couple best folks in the squad to come and work for me and my firm and our partnership? It was me. So the folks on Bench that we got to work with, like, were fantastic bookkeepers. People that I absolutely would have hired, like without second thought. But that was because we were able to truly cherry pick like the very best bookkeepers inside their organization. And so for me, it was a great deal. Like, it really, really was. It kept my team's focus on the higher value stuff rather than just like churning through a high volume of smaller dollar bookkeeping projects. Like, I'm more interested in the two to $3,000 a month engagements where bookkeeping is, you know, six or $800 a month of that and all the other stuff we can actually make really good money on. I'm more than happy to give up some margin to Bench pulling them in to do that work. And rates wise, like, we had a really good kind of custom worked out deal with Bench that made that good for us financially. It's actually honestly a model that I wouldn't be surprised if we see more productized solutions lean into. Like being a bookkeeper for accounting firms. Like, it worked great for me, those services, you know, like, you know, if you look at say QuickBooks, live bookkeeping and say, well, why don't you go and do bookkeeping for accounting firms? They got to nail the consumer facing service first before they could do that stuff for, for, for accounting firms. Because the accounting firm work will push their margins even lower. And if they can't do that work profitably for consumers, then doing that work for accounting firms, like, that's a whole different ball of wax. This episode is sponsored in part by Live Flow. Do your clients just throw up in their mouths a little bit when you send them a PDF of their financials every month? I bet they do. Because what is even that? What, how do you, what are you supposed to do? A set of financial statements? Most people, they don't know how to make sense of this. What if you started delivering something, something better? Okay, think about it. Live Flow kind of the OG what they used to do they let you connect your QBO, your 0 to Excel and Google sheets so you can, you can make your wildest, wildest spreadsheet dreams come true. Now they have these simple little financial dashboards you can build have all the same connection points to your accounting ledger. But you can build like a more intelligent report that your client will actually understand. You can give it to them on a monthly basis instead of financials give it to them on a weekly basis. Even because it can connect to the ledger in real time still means you gotta do the bookkeeping every week. But if you're looking for something your clients will actually engage with a little more and get more value out of that ongoing accounting that you're doing for them. Oftentimes the answer is to change the deliverable to to something besides this stanky, stanky old PDF financial statement package. Okay, I'm not the boss of you. I'm not here to tell you what to do besides mosey on down to the Show Notes and learn more about life Flow via the link down there. This episode is sponsored in part by Core V Tax Firms. Please do not go headlong into tax planning season without the right tool for the job. You are flying blind, you are wasting time and you're probably underselling the value of your work. Core V to help you find like a bunch of tax saving strategies for clients. Like not just maximizing retirement contributions, but a whole bunch of opportunities. But the problem for most firms is we just, we undersell the value of our tax advisory work across the board. You look at small tax firms, the ones that are absolutely crushing it. People we've talked to on this podcast that are working like half time making several hundred grand a year, they are making that on the back of charging top dollar for tax advisory. And I honestly didn't know how to do it until I saw a really good tool. Prove the value of your work and we kind of forget about it. Like we understand like yes, the stuff that we do is very valuable, but we forget about just how much money we can put like we regularly put back in our clients pockets through tax savings and tax deferrals. And then we go out and you like bill the time. You know it took you an hour and a half to do that. Here's this $400 invoice for that 40k in tax that we just deferred. That mindset shift of how to better capture that value. It's actually made way easier with good tax planning tools. Corvee is my tippy top recommendation. Other Tools in the space that do this stuff. Corvee is actually the number one one that I recommend. Check out the link down in the show notes to learn more. There are like outsourcing services that work exclusively with accounting firms. Obviously that will do like large volume bookkeeping stuff where instead of hiring people directly, you are actually paying like per month end close, that sort of thing. Honestly, the experience people have with most of those services that I talk to, it's a total crapshoot. You may have a phenomenal experience during the sales process, but in the sales process you're working with the very best people on those teams. Then when you actually get into an ongoing engagement with those groups, I've heard a lot of examples of the quality deteriorating. It's why ultimately I recommend hiring specifically specific people. If you're going to go offshore, hiring specific people and they just work for you the same way that all of your onshore people do, then you can hold them accountable. You can develop them just as you would anybody else on your team. It's a, it's a longer investment than just going to a group and saying, can you do 500 tax returns for me? And them saying yes, but to develop those people yourselves, I think longer term, that's where I see almost every firm that offshores end up is hiring their own people. Okay, rounded up a bunch of kind of different types of reactions to the bench stuff online, which, wow, you cannot even scroll social media as I'm recording this without it just being a non stop feed of bench stuff. And that's. I've kind of got some thoughts on, on that whole thing as well and how it actually ought to make you think about your social media strategy. But a roundup of a bunch of different takes here. First one I got here is from Allison McLeod posted on LinkedIn. The app is not the advisor. QuickBooks is not an accountant. Gusto is not a payroll expert. TurboTax is not a tax professional. Wealthfront is not a financial planner. Goes through a bunch of examples like that and how a recurring mistake is that consumers perceive the platform to be an expert when all it is is a platform. I don't think she called out bench specifically, but this has to be a reference to bench. Right? And for all those platforms she listed, I actually agree with that. Like Gusto, Gusto is not a parallel expert. QuickBooks is not an accountant, but bench, honestly, bench I think was the closest to something that was between a product and an actual expert because you had a bookkeeper who's supposed to be an expert that you could talk with. Now, whether they actually were not, whether they were that impressive of an expert is very much came down to luck of the draw and who you got right. There's going to be people eventually you probably would have had a phenomenal experience with and other people who you wouldn't have. But also, let's be real about what's a nice way to put this. The normal distribution of quote unquote bookkeepers. People who say they will do your books. We've got a bunch of world class bookkeepers that listen to this podcast, but you are not within the normal distribution, I think, of people who hold themselves out as bookkeepers. So while it's really easy to dunk on services like this and the quality of work that you get from them, what do you get when that small business owner turns up and their spouse did the books or their teenager did the books? Even people who hold themselves out as professional bookkeepers who do a really crap job. And this isn't a bookkeeping thing. Like you get the same thing with tax, but something about bookkeeping I think feels more accessible to people than tax. So you're not always working with a high bar and so it is easy to like pick apart. These are new college grads. How are they supposed to actually know anything about bookkeeping? You can say the same thing about a lot of folks out there who do shoddy bookkeeping work. Not a shot at bookkeepers, specifically that, but you know what I mean. Chris Barrett on Twitter posted, I know someone who can do it cheaper and then the guy who can do it cheaper with an image of Bench and their announcement of the closure and then this. A lot of the conversation online was around this, like the cheapness of Bench. What do you expect when it's going to be super cheap? David Leary's post here. A lot of posts saying, if you were with Benchmark, come to my firm tech company. David says, my question do you even want a client that chose Bench over you to begin with? What does that say about the type of client they are? Do they value an accountant or Cast service enough to pay more for it? Bench was charging many people over a thousand dollars a month for their accounting. Like the entry level prices that you see on bench's website. Basically $300 a month. If you're paying month to month, that is more than the minimum monthly fee for for most professional bookkeepers it is. And we're talking about Bench, the productized service that couldn't hack it. I mean, if you ever got work from Bench. I never got stuff that I was particularly dazzled from that we weren't overseeing. But Bench's rates, I don't know that they were any less than most accounting firms out there because behind the scenes those engagements grew and they charged more over time. But you know how many rinky dink little companies there are out there with like one rental in it or some stupid holding company? What is your minimum for that type of company? It's probably less than $300 a month. So Bench actually like, was not as cheap as I think people think that it was, but it was perceived to be inferior just because of the productized nature of it. Now, should you work with clients that use a service like that? I don't know. I think everybody gets burned at some point and they hopefully learn their lesson and go and work with a real professional. I mean, most of the clients that we pick up, how many of them have come from their spouse doing the books or a professional who just was not as good as you doing that service before, and then they evolved to you and they're probably paying more now. I mean, some of that is just like the natural progression of an entrepreneur and learning the lesson of, oh, here's the value of having like a reliable provider for this. I don't know that I would. I would entirely write off all of the people out there that were using benchmark. The reality is there's still a significant appetite for productized accounting. Slash, bookkeeping. You know, tax is a great example of a purchase that people make begrudgingly because they have to. Nobody wants. Can I say that nobody wants a tax professional? They may want. No, let me say it this way. Nobody wants a tax preparer. They want a tax advisor. But nobody's excited about the fact that they have to pay somebody to complete some forms for them. And that's obviously a vast simplification, right? But I'd say bookkeeping, by and large, for small businesses is the same way, because these are compliance books. Like small business owners, 90% of them are putting together books to be able to file an accurate tax return, not because they want to sit down and pour through their financials and extract from them insights that will make their business more profitable. Doesn't mean that they, they shouldn't be doing that and that we can't help them to do that. Most people are still buying any sort of accounting support begrudgingly because they have to. It is like taking out the financial trash that is a byproduct of running a business. What they're excited about is their business, not all of like the financial off gassing that happens when you transact business. And so in a perfect world, entrepreneurs, they want it to be product like they. Because they want it to be that simple. And they may be lying to themselves thinking that it is that simple. But because of that, and like I'm the same way like you would be too, let's not pretend that anyone is super, super excited about having to pay somebody to prepare a tax return. But as long as people are like, man, I wish this didn't have to be so hard, they will see a shiny landing page from somebody saying it doesn't have to be this hard and they'll go and sign up for it. So like those people still exist today, like they are still going to productized services in droves. The churn at Bench was outrageous. Most people estimate bench had about 25,000 small businesses on their platform. But if you look at the churn for a platform like that compared to your average accounting firm, like it's going to be astronomical. All sorts of different reactions from this. All the other sort of competitors were going out and trying to get Bench's customers. In fact, in the initial announcement from Bench, they sent people to Kik. Kik is a productized bookkeeping company that's raised money from a number of folks. OpenAI included smart people behind Kik. I know them. But right now, as evidenced by Bench going down, I don't know that anybody has put their finger on unlocking what a hyperscale bookkeeping firm looks like. I can tell you the mistake that most of them make is they think it's about classifications. They think that, oh, if we can just automate the last mile of classifications for bookkeeping, then we will have automated accounting. What you need to automate, like to truly get to a crazy version of Skale is not classifications. It's the month end close. And the month end close requires a whole lot more than just classifying transactions. You got to pull in all the different stakeholders, the different data sources and context that will dictate how to not only properly classify a transaction, but post journal entries like at the end of the month. And I think this over fixation with classification is the most common mistake that I see tech companies making when they're coming into accounting. And it's why probably the coolest opportunities right now in accounting automation, like if anybody kind of does the holy grail, like creating an AI agent or something like that, that can automate the entirety of a month on close, that's going to start in a very, very specific vertical. We talked about this last week as we were kind of looking at bookkeeping tech advancements this year. But the only way you really do that is to build something for a like very specific, a tech stack in a very specific vertical where all the inputs are more or less the same every single month. And the financials for this type of business like have kind of an agreed upon structure to try to do that for any and all type of business out there. It's just not realistic, right? Maybe long term somehow there's this magic tool that can do it for any old business, but where would it have to start? Would have to start in a very, very specific application, right? And this is I think another learning to maybe take out of this benchmark. I don't wanna say downfall, but, but lack of success is that if you're going to do actually a truly highly automated version of this, you're better off starting with something specific, a very specific vertical where more of those inputs are in common. Because imagine being bench and taking small businesses of pretty much any type. Like they would only do cash basis books, but if that's the degree of specialization, you just have to do cash basis. Boy that opens your doors to a whole lot of different types of companies, right? This episode is sponsored in part by Stanford Tax Gang. Stanford Tax was one of the like original, original originators of cool new tax workflow companies who have built killer stuff around intake. Specifically I've been shouting from the mountaintops tax firms headed into 2025, you need a tax intake tool will save you a massive amount of time. Stanford Taxes is one of only a few that I recommend. The whole having to like sit down and go through when you've got a stack, a pile of client, a pile of client information and you're like okay, here's everything we had last year, here's what we need this year. What have they actually given us? Stanford Tax Gang. It will generate a complete checklist based on prior year pro form information of everything that you need and you can drag all those documents on and it automatically checks off all the items. A stack of 40 PDFs, drag them on there, it'll auto resolve all those checklist items, will follow up with your clients until they get you all the stuff that you need and just completely eliminated that entire step of doing 1040 work where you're like do we start the project yet or do we follow back up with the client for more information? Absolute game changer. Big fan of Stanford Tax. Check out the Link down in the show notes. This episode is sponsored in part by Cloud Accountant Staffing, who help you find super smart Filipino accountants. We all know the struggles of working with vendors who just do not understand what, what we do. They're not accountants. They don't get it. They're not, they're not cut out like we are, right? If they were, they'd be accountants. But cloud account staffing, man, they get it. Because their origin story is literally an accounting firm that started hiring people in the Philippines. They're like, wowie, wow, wow. This is a better way to staff. Our firms started making some friends in other firms and they started doing the same for them. So the people you interact with when you're working with Cloud accountant staffing, they get it. They understand exactly how firms work. They only do this stuff with accountants. So you're not gonna be beating your head against the wall with some random offshore group because goodness sakes, are there plenty of them out there? And you get umpteen messages from them every single week online, right? Getting there. There are two groups we do sponsorships offshore of any kind with on this podcast and any of my content. And we keep coming back to the same too, because I keep hearing from people that are having great experience. If you want to cut through a whole bunch of the noise and like, get down to a shorter list of people to work with, man, check out Cloud Accountant staffing link down in the show notes. Acuity. They're a accounting firm in Atlanta. I think they're top, top 100, top 1 50ish. Matthew May posted that they were putting up a hundred grand to support bench companies or bench customers. Transition Transit. Transition, presumably to Acuity. Acuity actually really profited from Scale factor going down. They actually got some pretty good talent out of scale factor. I think some, some customers as well. Some Canadian firms kind of put the word out that, like, hey, bench employees, if you're looking for a new role, like, come and explore our firm. Another post I've got here from Roman Villard. He said two initial thoughts on this says, I feel for the folks at Bench. By the way, we're so fast to like dance on the grave of Bench. It's like real accountants work at Bench. A lot of people, a lot of customers just got hosed. The worst part of all of this is you got a whole bunch of people's books who aren't, who aren't done. And in many cases we're like far behind. I've seen some people share screenshots saying, like, all my Books are five months behind. You know, we've been on the other side of that and it's hard to know like did the bookkeeper have all the information to complete the books up until year end? But one thing is for sure, Bench ain't giving any refunds. So Everybody's paid for 12 months bookkeeping. But at 12:31, actually a bit before 12:31, bench was like, whatever we've done is what we've done and we'll give you a way to download this information. That was before Bench got acquired by employer.com like 24 hours later. Which is just wild that Bench will now continue. But I've actually seen a lot of Bench employees chiming in saying like, we haven't heard anything, like they haven't hired us back. So it's still not really clear what's going on. Anyways, back to Roman's post. And then the second takeaway was he said, we're still a solid distance away from a truly productized accounting service. I think, quote unquote, productized is increasingly becoming blurred because I think Bench was actually one of the less purely productized offerings out there because they were standing up a bookkeeper that you could actually talk to that was the actual person who did your books. You had pods of, I think it was like three or four bookkeepers with a senior bookkeeper above them that would review the work. But as a customer turning up to Bench, I would go and talk to the actual person that did my books. Roman also mentioned in their farewell note, they're recommending another low cost and unproven product solution. This is this kick that he's referring to. Should people leave Bench and go to another productized service after just getting burned? I don't know. I mean, I think honestly the, like this can happen anywhere. This, let's be this be real. This can happen in accounting firms as well, where something changes, there's an acquisition and customers get left in a lurch. I mean, how many accounting firms have doubled their rates in the last few years? Like we can, we could point the finger back at ourselves too and say like sometimes the customer gets left in a pretty crappy situation. I think what makes this worse is the venture backed ness of it all. The fact that Bench was running out of money, they weren't able to raise money, the fact that they were subsidizing the whole business with, you know, the $100 million that they raised. I would argue it's the venture backed component of this that is the actual bad thing here because it Lets you stand up a service on like an unrealistic premise and requires no sort of like it doesn't require a level of fiscal responsibility that sets realistic expectations for the customer long term. Like if Bench or Kik or anybody else, if they have to onboard clients at a price where they actually make money on every single client, that's a very different value proposition. Right? So this notion that you can sort of borrow against the future and take out a bunch of VC money to do stuff at a discounted way now, thinking that we're going to get to economies of scale down the road, you're kind of like putting those customers in a tough spot when to date nobody has nailed that yet in a sustainable way. Like of the VC backed companies, Pilot now is probably the longest running company after Bench and they have a much different fee structure and they target more specifically startups. I don't know if they'll work with any old business like Bench did. So a lot of this is kind of like the bummer nature of VC backed stuff. So four takeaways that I had highlighted here. Some of these we've touched on a bit. One, somebody building a similar productized bookkeeping solution needs to prove why they're theirs will work. And these ones did not like Bench just ran for 15 years and they shut down. What are you doing? Fundamentally different that they weren't able to figure out. And honestly there isn't that much secret sauce out there anymore because everyone is using the same public AI models. They will say that we are building our own proprietary this or that and it is what is proprietary is the ways that they are using all of those same models, be it embeddings, be it large language models, everybody is leveraging the same tools, which is different than what it was 10 years ago when the biggest players could train their own models from scratch. And that was their secret sauce was their proprietary model. These days the only thing proprietary about what anybody is doing is how they are using the same public models. So is there really somebody that has found something so fundamentally different that it is this vastly better step up front Bench? Probably not from a technical standpoint, from a business model standpoint maybe, but not from a technical standpoint. Second takeaway, when it comes to accounting automation, it's all about the close, not classification of transactions. Like there's such an over fixation on how to classify. But as you know, there's so much that goes into actually closing the books than just coding transactions. Third takeaway, transaction data must not have any value anymore, right? Think about the volume of transaction data that Bench has and how in the previous era, before Generative AI, before what everyone held out as their competitive advantage was, well, we have all of this data that nobody else has. In fact, the incumbents still say this. You want to know how to detect BS from, from someone who's trying to say that they are still relevant and still have a competitive advantage. It's saying, well, we have all of this data that nobody else has and this is how we will have a leg up on everyone else. If that was valuable, how was Bench just about to shut down overnight? Think about the volume of transaction data Bench had. Nobody cares about that stuff anymore. When everyone is using the same models and these public, like, the reason it's gone this way is you have OpenAI and Anthropic and all these other companies investing billions in training these generalist models, where the notion of any company individually, like training a model for themself has become like, it would have to be such a incredibly specific model to go train it themselves. And it'd be any better than the generalist models that are 100 times as big and 100 times as, as profitable. And so those transactions, you know, big data that used to have all of this value, where's that value? I kind of love it, honestly, because it, it flips the table over on the incumbents and says, you gotta actually do something interesting now. It's not enough to just have all this data and sit on it. How many years have we been listening to Intuit and zero say, well, because we have all this transaction information. Your, your reconciliation process and matching process is now about to get much more intelligent because we'll use the insert vanity metric here, number of transactions we have across all users to make it more intelligent. I don't know about you, I'm, I'm still waiting for that. I'm still waiting for the moment that that like, makes my job classifying transactions easier. Still hasn't happened. Fourth and last takeaway. A reminder that human nature is to amplify that which is in support of our worldview. I mean, just about every single post on my social media feed right now is about Bench. And this is maybe the very worst part of social media. The fact that it's not about having intelligent conversation or expanding ourselves. Like, the quickest thing that people will amplify is the story that's like, yeah, this, this is why I feel this way about this. And I mean, you can understand why accountants were like very quick to jump on all this stuff. It's like yeah, down with vc back to county. I told you it was harder than you thought. It was very easy to go full neener neener on this which kind of a bummer. Like just accept that that is core to human psychology and algorithms are riding that wave pretty hard right now. And if there's something that you can take from this for your tech company, for your accounting firm, it is that if the tenants your firm runs on are something that resonates with people, your customers will do the same thing. If you are the accounting firm who has a deep understanding of how the DSO model and big health is ruining single doctor dental clinics and how it's so unfair to them and this and that. If that is like the tenants on which your accounting firm runs, people will get behind you like it is. Yet one more I don't know reason why having something to say, whether it's cool, whether it's PC, like just having something to say has never been more important than it is now because the people who align with that worldview will will amplify you in what you do now. Don't, don't be evil and I I would love it if we if we weren't quite so brutal with like all of the people a bench that just got hosed. But you can do the same thing with how you position your firm. If it can have something to say of substance and be for a specific type of person, that's what gets people excited. That's the difference between a social media post that engages in one that doesn't. It's something I've struggled with honestly the last couple years is playing the yucky game of posting things people will agree with versus posting stuff that is actually helpful and like moves the conversation forward because the algorithm doesn't always reward those two things the same way. But that is the game and the game is what it is. And if I'm running an accounting firm, you better believe I'm going to be playing that game. It's going to be opinionated, it's going to be for a specific type of person and it will have something to say. Down with peace of mind. Down with trad firms. I just we need to get that to catch on more trad firms. I can't remember where we started using that. I think that was around hourly billing firms that do hourly billing. Down with trad firms. Poor one out for for the bench folks. For the customer is a bench. A whole lot is still in limbo even though employer.com came in and acquired bench Bummer situation. Productized accounting is not as easy as it looks, but you already knew that. Any other thoughts drop down in the comments. Otherwise, thanks for coming Hanging today.