Roan Lavery, CEO & Co-founder of FreeAgent

Today’s profile features Roan Lavery, CEO & Co-founder of award-winning, easy-to-use accounting software, FreeAgent.

Over to you, Roan…

Who are you and what’s your background?

I’m Roan Lavery, CEO and co-founder of FreeAgent. My background was originally in science (I completed a PhD in physics at Edinburgh University many moons ago), but I quickly went down the path of web development with a small training and design agency before becoming a freelance web designer and developer. It was during that freelance career that I crossed paths with two other freelancers – Ed Molyneux and Olly Headey.  We bonded over a mutual dislike of spreadsheets and financial admin, and decided to make something that would make managing our accounts easier. That something became FreeAgent, and it’s where I still work today.

What is your job title and what are your general responsibilities?

As CEO, I oversee the whole company and am responsible for our strategic vision of helping small businesses nail their daily admin, relax about tax and run healthier, happier businesses. Alongside my fellow executive team members, I try to empower our 280-odd staff to build, evolve and maintain the best possible software, while also working closely with key stakeholders from the NatWest Group (who purchased our business in 2018). Prior to leading the company, I was FreeAgent’s Chief Product Officer. So although my days are very different now and I don’t get involved with the nuts and bolts of user experience research or writing code, I still take a keen interest in how FreeAgent looks and feels from a customer perspective.

Can you give us an overview of your business?

We make award-winning accounting software designed for small businesses and landlords, along with their accountants and bookkeepers.

We currently have well over 150,000 customers who use FreeAgent to send invoices, manage their expenses and keep an eye on their cashflow. They also enjoy a range of innovative time-saving automation features,  tailored insights and accounting reports which help them stay on top of their finances.

We have a handy mobile app that gives small business owners the freedom to create invoices and record expenses on the go, and a Smart Capture feature that can extract key data from receipts automatically. Our customers can even submit MTD-compliant VAT returns and Self Assessment tax returns directly to HMRC from within our software – and there’s a friendly UK-based support team ready to help if you get stuck.

Tell us how you are funded?

We’ve had an interesting funding journey over the years to say the least! When we founded the business in 2007, we invested our own money (and maxed out a few credit cards) to get things started, but once we started growing, we were able to look further afield for funding. We were lucky enough to catch the attention of some high-profile VC funders including Robin Klein and Christoph Janz, who helped fund our early years, but in 2015 we also undertook and completed a successful £1 million equity crowdfunding campaign through Seedrs. The following year, we completed a successful IPO and became a publicly listed company on AIM and then, in 2018, we were finally purchased by the NatWest Group – where we currently run as an operationally-independent entity.

What’s the origin story? Why did you start the company? To solve what problems?

The FreeAgent founders – Ed, Olly and myself – all enjoyed working as freelancers but we hated the financial admin that came with it. Back then, there wasn’t really a solution that had been designed for the kind of businesses we had, so we were forced to manage our money and calculate how much tax we owed through spreadsheets – which was time-consuming and fiddly. It got to the point where we decided that, if no software existed for freelancers and small businesses, then we should make some. So we created FreeAgent and it quickly proved to be a big hit among small business owners who liked the fact that it was easy-to-use, wasn’t filled with confusing accounting jargon and actually gave them better clarity over their business accounts. One of our earliest customer reviews said that FreeAgent made them feel “smart, not stupid” about their finances, and that’s something we’ve strived to maintain ever since.

Who are your target customers? What’s your revenue model?

When we started FreeAgent in 2007, we were mostly aiming the software at freelancers and very smallest “micro” businesses – i.e. people running the same kind of businesses that we had. But in the years since then, we’ve broadened our horizons and built a range of increasingly innovative features to help a much wider spread of business types.

These days, we have customers across a wide variety of industries and sectors – who range from one-person sole traders all the way up to businesses with 20 or more employees. We also work with thousands of accountancy firms and bookkeeping businesses, who provide FreeAgent as part of their service to small business clients. And only last year we also released a specific version of FreeAgent to meet the needs of landlords with their rental properties. In terms of our revenue model, we’re a Software as a Service (SaaS) product, so many of our customers pay a monthly subscription fee to use FreeAgent – which they pay either directly to us, or through their accountant or bookkeeper. However, FreeAgent also forms an important part of NatWest’s small business proposition, which means that customers with a NatWest, RBS, Ulster Bank or Mettle account can get FreeAgent for free.

If you had a magic wand, what one thing would you change in the banking and/or FinTech sector?

Sometimes it can be tough to innovate or move quickly in the fintech sector, especially when you’re dealing with big entities like multinational banks or financial institutions which have a lot of stakeholders and moving parts.

For smaller, nimbler fintech companies, that can sometimes be frustrating. I think if larger financial entities were more willing to take risks and sometimes fail, it could help to foster greater innovation within the sector and mean that they don’t miss out on genuinely game-changing ideas or transformational pieces of technology.

What is your message for the larger players in the Financial Services marketplace?

Never lose touch with your customers! When you’re working within a large corporate environment it’s easy to get caught up in the day-to-day running of a complex business, but it’s important to stay in touch with your customers and create a culture that puts customer needs at the forefront of every decision.

Where do you get your Financial Services/FinTech industry news from?

I pick up news about the fintech sector from a wide range of media – including dedicated websites like FF News | Fintech Finance, FinTech Futures and Digit, as well as national newspapers and business titles. However, one place that I regularly visit to catch up on what’s happening within the fintech space is Finextra.

What FinTech services (and/or apps) do you personally use?

I have family living overseas and so I use Wise to send money to them. Sending money abroad used to be so difficult and expensive and Wise was really a gamechanger in that regard.

Finally, let’s talk predictions. What trends do you think are going to define the next few years in the FinTech sector?

I think we’ll continue to see a deeper, more sophisticated flow of data between banks and other fintech products such as accounting software, insurance, invoice financing, payment providers etc. In the past, big financial organisations were typically the gatekeepers for that kind of information – and many would be reluctant to share much outwith their own walls – but the explosion in adoption of new mobile apps, challenger banks and fintech software by business owners has dramatically changed the way we look at data.

These days, most business owners want to have a secure data feed that goes from their bank directly into their accounting software. They want to see their financial information at-a-glance and while they’re on the move. They want to be able to have near-instant payments through their smartphones so they don’t have to waste time chasing up invoices.

They want their apps to flag up potential issues with their financial data and, where necessary, help fix the problem – whether by offering practical advice, or by directly facilitating a solution (such as enabling them to purchase bespoke insurance products from inside their accounting software).

We’re already seeing a lot of this happening in the industry – for example, the direct data integrations that NatWest has between tools like FreeAgent, Mettle and PayIt, and the direct business insurance purchasing feature that FreeAgent has with Hiscox . These types of relationships will only get more and more sophisticated, which could herald the dawn of an entire era of smart finance for small business owners.

However, I don’t think that artificial intelligence will play as much of a prominent, groundbreaking role as some are predicting. Yes, there will probably be some really rich, deep examples of insight-based data coming over the coming years, but you will still need human expertise to properly review and contextualise that information – such as accountants using AI to provide deeper insights and analytical services for their clients. We’re still a long way off the technology being able to autonomously do this for itself!

The challenge for businesses, fintech providers and banks will be in figuring out how AI can best suit their needs and those of their clients, so they can stay ahead of the field.

Thank you so much for taking the time to participate Roan.

You can find out more about Roan by visiting his LinkedIn Profile here: Roan Lavery.



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