Exchanging Excel for a better way

On a recent visit to Australia, BlackLine Systems CEO and founder Therese Tucker caught up with Freya Purnell to discuss how the company has evolved, why it sees great opportunity in the Asia-Pacific region, and how BlackLine is riding the cloud and big data waves.

Strong adoption of cloud solutions, a predominance of global companies, and a virtually untapped market for enhanced financial control systems has made the Asia-Pacific region a key focus area for financial solution provider and SAP Gold partner, BlackLine Systems.

While the company now primarily offers cloud-based solutions, such as the BlackLine Financial Close Suite for SAP Solutions product, it didn’t always. BlackLine was originally founded in 2001 to build wealth management software, and it wasn’t until 2006 that it built its first hosted application for a midmarket client which didn’t have the IT resources to support its own hardware. As customer demand for Software-as-a-Service (SaaS) grew, BlackLine chose to fully embrace the SaaS market at the end of 2007, focusing in the financial close and automation software space.

Now with more than 900 customers in total, the company is starting to look at what this data – for example, about the average time a financial close takes – means when considered together, says Tucker.

“What we have with this huge group of customers that are now on the cloud is the ability to start to mine [data] from an analytics perspective. The appetite from our client base for this kind of information is enormous,” she says. “For example, the simplest metric in the world – on average, how many reconciliations does a preparer do every month? What we know now is the average is 39. If you have somebody who is only doing five, then it is probably worthwhile to see why your production is so low.

“So the ability to look at some of the overall metrics around the financial close that are data-driven and across wide swathes of companies of all sizes, is allowing us to provide information to our client base that is super-valuable to them.”

This is especially appealing to CFOs, who want to know that they have a best practice accounting and finance organisation.


Building an Asia-Pacific customer base

In a bid to further expand the BlackLine business in the region, with a particular focus on ANZ and the major Asian markets, Todd Hunt has recently been appointed as vice president and general manager.

With its current ANZ client roster including Bank of New Zealand, Kimberly Clark, Linfox, Optus, and QBE Australia, BlackLine already has more than 110 customers and 21,000 users in the Asia-Pacific region, and has achieved a growth rate of more than 50 per cent year over year for the last eight years.

BlackLine is on track to exceed this again in 2014, and this is a result of the company’s commitment to the region and its customers, Tucker says.

“We are hiring like mad, so we plan to staff up pretty significantly in all areas of the company, because we view this region as very key.”

The Asia-Pacific region has been a much faster adopter of SaaS solutions, closely behind the US, and certainly ahead of companies in the EMEA region, which Tucker says has lagged by three or four years.

“The APAC region is probably more global than, for example, some of the US companies. It really is the gateway to Asia. So the ability to handle multiple currencies for inter-company transactions, and to handle different languages, really came from the APAC market, and was actually a beautiful way to be ready for the EMEA market, because it is very much global in the way that the States are not always so,” Tucker says.


Leading a category

Technology analyst firm Gartner recently renamed its ‘Close/Reconciliation Management’ category as ‘Enhanced Finance Controls and Automation Software’, and BlackLine was recognised as a sample vendor in this category. The category change was aimed at recognising the broadening over the last year of this class of software, going beyond period-end close to encompass functionality that enhances the management and control of any finance process throughout the accounting cycle.

“These solutions can be deployed across multiple core financial and financial value chain applications, enabling organisations to improve and better control their finance processes without major investments in the underlying applications,” the report said.

This new category really plays into BlackLine’s strengths in covering different aspects of financial process management, according to Tucker, including inter-company transactions, financial close, reconciliation management more broadly and big data.

With penetration of financial software in the Asia-Pacific market currently very low, Tucker believes the potential for continuing the company’s impressive growth rate into the future is strong.

“Everybody has a financial close, almost everybody does it in Excel and does it badly. So when you have got a great product and a huge market in front of you, there is no reason that you shouldn’t grow at a rate of 50 per cent or even more throughout the year.” 


This article first appeared in the Inside SAP Yearbook 2015 (published November 2014).


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