Bean Ninjas is now a Xero Gold Partner!
We’ll talk more about the Xero Gold Partner status and what it means below.
Anyways 15 months have come and gone since we launched, so it’s time for another update. Where has the time gone?
As founders Ben and I are so grateful for the ride that we’re on together, and the amazing team, clients and partners that we’re surrounded by as well.
It hasn’t been easy but Bean Ninjas have come a long way in 15 months.
- Monthly Recurring Revenue (MRR): $18,300 (78 customers)
- Achieved customer response time goal of 24 hours
- Became Xero Gold Partners
- Sponsored our first conference
- Meryl presented at Xerocon Uni Day
For a deep dive on each of these highlights, as well as tips and insights that you might want to apply to your own business, continue reading.
So how are we tracking against our key metrics?
Business Growth MRR
At 30 September, after our first 15 months in business, we had 78 customers and $18,300 of monthly recurring revenue (MRR). This is up from 69 customers and $14,650 MRR at June 2016 and 53 customers and $10,500 of in April 2016.
Our goal is to consistently grow our MRR by 10% month on month. We have achieved our projected growth each quarter, however our performance in particular months can vary.
July and August were slower months for us while we consolidated from a growth period in June. September has another month of rapid growth so we’re expecting to see another slow down and consolidation period in October.
Our churn percentage for the quarter was 2.74%, which is still higher than we would like. We’re aiming for under 1% per month.
We calculate churn as: [MRR of customers leaving (this quarter)] / [total MRR]
We then turn this into a monthly figure by dividing the results for the quarter by 3 months.
We noticed an increase in churn during July and August. A number of our smaller customers waited until we completed their End of Financial Year reports and then moved back to doing their own bookkeeping.
It was nice to receive positive feedback from these clients about working with us.
One client emailed us to say:
“We would like to thank you for the beautiful work you are doing and let you know we will stop with your monthly services for a while until our business picks up!”
Whilst another client shared,
“Thanks so much for everything you have helped us with to date. As mentioned earlier as our business is more simple now we won’t need to continue the monthly plan any more”.
We know that Bean Ninjas is a great solution where the benefit of our service outweighs the cost. This highlighted to us that customers who see the most value in our service are usually turning over $100k per annum and are in a growth phase. Reflecting on this helped us to refine our marketing strategy to attract the type of potential customers who would value our service.
Here’s a simple way to work out whether or not outsourcing your bookkeeping makes sense or not for your business:
- Cost of DIY [A] = [Number of hours you spend doing the bookkeeping each month] x [your hourly rate]
- Cost of outsourcing your bookkeeping [B] = see our rates to get an idea of what to expect
- Is A greater than B? If yes, outsource.
The calculation above only compares costs, but something else to consider is where should you (as the founder) be focusing your attention to grow your business.
Want more help with the above calculation? Contact us.
We’re getting better at identifying who our ideal client is, and attracting these kind of clients, which will ultimately help our customer retention.
Our ideal clients are online businesses – SaaS, digital agencies, e-commerce, services, bloggers, coaches and consultants – who are turning over between $100k and $2m per annum.
Our next step is to improve our screening process to make sure we’re working with people who are the right fit. Our focus is on long term business growth rather than on short term sales, so it is better for us to sacrifice sales in the short term to make sure we’re working with people who will have a great experience with us.
We lost one customer who was disappointed with the speed with which we started their setup. It took us 2 weeks to get started on the job from the date the customer signed up. This is our standard lead time, so we reflected on this and realised we needed to get better at setting expectations around timeframes upfront as part of the initial scoping process.
We aim for response times of less than 24 hours. Our average response time for the September quarter was 22 hours, but we responded to 44% of emails within 2 hours.
We had trouble with our response times during March and April and I’m proud to say these are now on track.
We experimented with changing expectations around response times. Premium clients receive 1 business day and all other clients receive responses within 3 business days (and usually much faster!).
This has been working well for us and has taken the pressure off our bookkeepers needing to work on the weekends.
We’re only tracking response times once a customer goes through our on-boarding process, so our next area of focus is improving response times during on-boarding.
Our main source of new customers during the September quarter was referrals from existing customers. Here’s the breakdown of major lead sources:
- Word of mouth recommendations from existing customers
- Podcast interviews
- Online groups
- DCBKK conference sponsorship
After focusing on our content strategy in April 2016 we’ve tested various strategies and determined what works for us. Blog posts have been working well as a way of getting our thoughts out there and podcast interviews have been working well as a way of getting in front of different people.
Here are our top 3 blog posts for the quarter:
Customer success stories
We’ve also been focusing on sharing regular customer case studies and these have been working well for us in terms of attracting new readers to our blog and interest in our services.
The case studies do 3 key things:
- Highlight the amazing calibre of business owners we have the fortune to call clients;
- Share practical tips on how they’ve been able to scale their businesses (that anyone reading can also implement in their own business); and
- Share how we’ve been able to help each business grow
Here are some examples (click on each image to view the actual case study on our blog):
We’ve also put some more time into social media. Our Instagram account just passed 1,000 followers and we’re getting close to 1,000 followers on Twitter. Make sure to connect with us if you’re on those platforms too:
Appearing as guests on other people’s podcasts has been a great way to expand our reach, and also connect with awesome podcasting entrepreneurs so we continue to use this strategy.
Top 3 podcast interviews this past quarter:
- Jeremy Ryan Slate’s Create Your Own Life podcast: “Creating Freedom & Managing Finances”
- Nik Wood – Life Athletics podcast: “On Freedom of Time and Location”
- Danny Flood’s OpenWorld Magazine podcast: “How to Create a Multiple Six-Figure Productized Service Business in 1 Year”
Want to leverage podcasts to get in front of other people’s audiences but not sure how? Read our blog post on this.
Working with Xero
Being a Xero only business it is important for us to have strong relationships with key people at Xero. They are building an amazing team at Xero who are very supportive of the Xero Accounting and Bookkeeping partners. During September we partnered with Xero on the following:
- Blog article for Xero on bundling services to maximise accounting profitability
- Xero gravity podcast interview “Building yourself out of business operations”
- Opportunity to present on a panel at Xerocon Uni Day
Here’s a snippet of Meryl at the Xerocon Uni Day panel discussion on marketing:
Here is a post that I wrote with the highlights and key lessons from Xerocon for small business owners:
We’ve been working towards becoming Gold Partners with Xero for the last 12 months. We achieved this in September. Yay!
So what does becoming a Xero Gold Partner actually mean, and why should you care?
Well there are Xero bronze, silver, gold and platinum partners. It takes 120 points to become a gold partner and you earn points for each Xero client you work with and also Xero education and training that you and your team attend.
Xero partner status provides a good indication of the level of Xero expertise. As a business owner it is worth checking the Xero partner status of a potential bookkeeper or accountant as part of your vetting process. You can check this on the Xero advisory directory.
At the time of writing there are only 2 Xero Platinum bookkeeping partners in Australia. We’re aiming to be the third!
Sponsoring a conference
We headed to the DCBKK conference in October – a fantastic conference in Thailand for digital nomads. This is the first time we’ve sponsored a conference and we’ve already learnt a lot.
So why did we decide to sponsor a conference?
The Dynamite Circle (DC) online community is made up of people who are our ideal client i.e. online business owners who we enjoy working with.
Sponsoring the conference involved:
- Having a display table
- Putting our logo on the main conference slides
- Receiving a mention on the organizer’s podcast
- Having our merchandise included in the conference swag that went out to all participants at the conference
Here’s a photo of our swag for the conference – journals, sign, business cards, and flyer. What do you think?
Another great benefit of sponsoring the event was that we got to mastermind with some amazing online entrepreneurs (you might recognise a few of them below).
We’ve created and been testing a new lead magnet (value offer) opt-in which is having a better conversion rate. Here’s what it looks like (click on the image if you’d like to check it out):
We originally had another opt-in linked to an email sequence which comprised of a welcome sequence explaining more about who we are, and then went into a sales sequence encouraging the purchase of our Xero Audit.
I made a decision to turn the sales sequence off. We didn’t have many people making the purchase and some people in that automated funnel were also going through a scoping process.
I felt the risk of damaging the relationship was much higher than the potential upside of them purchasing a Xero Audit.
Down the track we’ll spend some more time on our email sequences and make sure they flow and that I’m comfortable with them not being too salesy.
In the meantime we have enough scoping calls coming through to keep us busy.
We are currently a team of 10 part-time bookkeepers plus 2 co-founders. We recently welcomed Chris in the US and Michelle and Chantelle in Australia to the team.
We’re in the middle of another recruitment process and as our growth rate continues this will be a key area we focus on.
If you know of a bookkeeper who is looking for 3-5 days of work per week, please refer them to our jobs page.
Having a flexible workforce comprised of casuals and contractors has worked well for us in the past. It provided flexibility and reduced some of the risks associated with hiring full-time employees.
We’ve realised that to continue with our growth we’re going to need to transition from a workforce of casual staff to a team of dedicated permanent part-time and full-time employees.
We’ve been working in the background to ensure we’re setup to handle permanent employees.
Unfortunately there is a lot of compliance associated with hiring staff in Australia and the US.
I mentioned in our June quarterly report that we hired a Bookkeeping Manager back in May 2016. This has been amazing and helped to accelerate our growth rate. Kaye has taken responsibility for ensuring that all of our bookkeepers are aware of their deadlines and jobs are completed on time.
Another key area is looking after the onboarding of new clients and allocating recurring bookkeeping work to our Bookkeeping Team Leaders.
Our previous focus has been on our Onboarding process. Kaye our bookkeeping manager is now looking after this and we are continuing to refine this.
With our growing team we’ve realised the importance of consistency and clarity with our internal bookkeeping processes. We formalised our ‘Bookkeeping Bible’ document which outlines the ‘Bean Ninjas’ way of doing things for all of the common bookkeeping scenarios.
We held an in person training session during August with the majority of our team .. and Michele in the US called in via Skype. Many of our team members had never met before so it was a good chance for them to put a face to a name and get to know each other.
Here’s a photo of our whole team at the August training:
Where to next?
Other things in the pipeline or focus areas are:
- Hiring new bookkeepers to join our team
- Creating a ‘team leader’ training program and investing in our team leaders
- Systemising our sales process
- Reviewing our SOPs and getting our team more involved in creating and maintaining these
Have any questions or thoughts about what we’ve shared? Leave us a comment and we’ll be happy to discuss further with you.
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