There are innumerable benefits that come with automating every aspect of your accounts receivables process, from streamlining and accelerating financial closures to making the whole process a lot faster and error-free. Chen Amit, Co-founder and CEO at Tipalti discusses more in this QnA with GlobalFintechSeries.
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Can you tell us a little about yourself Chen? We’d love to hear about your fintech startup journey, what were some of the initial challenges / highlights when entering the marketplace- what are some of the biggest learnings you’ve come away with so far?
My fintech journey began in Israel, my home country, where I received a B.Sc. in Computer Engineering from Technion and an MBA from INSEAD. I started out as a software engineer for ECI Telecom. This proved to be an outstanding career choice. I thoroughly enjoyed being a software engineer, and I also enjoyed my time as a product manager.
I started Tipalti as the only employee and ultimately became the first developer and product manager, wearing other hats as needed. After a couple of years, it became clear that I had created something with actual potential but in order to see how far we could go, we needed full-fledged company. It was time to hire some employees and take Tipalti to the next level. I also made sure that we launched in the United States to test the market and our international appeal, which, if successful, would allow us to grow well beyond what we could achieve in Israel alone.
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However, this was not an easy move as I was still the only employee at the time. As you might imagine, establishing ourselves in the U.S. involved a lot of trial and error. But I took it slow – I didn’t want to rush into the market without thinking things through. I wanted to work hard and deploy gradually to make sure we got it right. I quickly learned that I had made the right decision and would absolutely do it the same if I had to do it all over again.
I’m happy to say that as challenging as it was, I’m glad I took my time. Hiring was also difficult, and I am grateful to those who took a chance on my underfunded, one-year-old company that had yet to prove itself. I was fortunate to find a partner who was smart, trustworthy and highly capable. Together, we built Tipalti into the company it has become today.
What are some of the game-changing innovations you’re seeing in the global fintech marketplace today, especially when it comes to accounts payable platforms?
Automation has helped so many industries, and accounts payable is no different. I would argue that AP might have needed automation more than any department. AP is a burden and was only getting worse. Our survey of CFOs showed that nearly three-fourths (72%) of finance organizations waste up to 520 hours annually on manual AP tasks. Even worse, 28% of CFOs admitted that their teams waste up to 1,040 hours on the same tasks.
By automating payables, firms can accelerate their monthly close. They can work with confidence and have more time to focus on tasks that will propel the business forward. This is invaluable, especially during these challenging economic times, where every second – and every dollar – means everything.
How do you feel emerging technologies (AI/etc) will play a role in the future of the payable automation landscape? Can you share a few thoughts on some innovative applications being built in the market today?
Artificial intelligence (AI) has become an invaluable, must-have technology. According to a report by Accenture, 75% of businesses that fail to scale the technology could be put out of business. That might sound extreme, but it could be the differentiating factor between organizations that thrive and those that crumble in a post-pandemic world.
AI is especially critical in business finance, allowing organizations to future-proof and ultimately de-risk their entire payables operation. AI enables businesses to scale finance and do more with less. For example, Tipalti Pi is a continuously-adaptive and integrated payables intelligence engine that relies on AI and machine learning to create a smarter, more efficient payables process.
These are the kinds of innovations businesses need. In a world of COVID-19 and new regulations like the California Consumer Privacy Act (CCPA), organizations need to identify fraud and risk proactively. They must be capable of eliminating AP process errors, which prevents the never-ending AP-related headaches from mounting. And they need to improve decision-making while automating manual work as much as possible.
Could you tell us about Tipalti’s product and how it’s evolved over the years…what are some of the upcoming plans in store for the platform?
Tipalti was built from the ground up to allow organizations to scale finance and maximize efficiency. We use automation to make payables easier and safer. More importantly, we wanted to build a platform that could assist businesses in modernizing their financial operations to help them evolve and achieve success.
Our platform’s latest evolution is Tipalti Pi, a payables intelligence engine that uses AI and machine learning to create a more efficient and smarter payables process.
How do you feel B2B payment solution providers will have to adapt to market changes in the new normal: in what ways have you seen companies cater to changing trends the last few months?
B2B payment solution providers have had to make a swift transition to the home office, but this was not easily executed for companies that failed to make automation, digitization and cloud technologies part of their finance stack. Can you imagine the stress of COVID-19, remote working, and, for those who have yet to modernize accounts payable, the time-consuming tasks associated with manual AP? While many have adapted to the home working environment, it’s time for organizations to embrace new ways of working to save time and scale with lean resources.
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In order to cater to changing trends, businesses have had to build a finance stack optimized for this changing workforce – scalable, adaptable and ready for whatever comes next. They also have had to reevaluate their team and company-wide communications strategies, ensuring that everyone remains informed, connected and capable of reaching out at all times. It has been especially crucial for the CEO to communicate with the controller and broader FP&A members daily.
What are your thoughts on the impact on Covid-19 on the current global fintech landscape- what are some of the key trends you’ve observed?
Increased market uncertainty means that financial leaders have had to re-evaluate their full-year 2020 and 2021 plans and adjust when necessary to prepare for the worst. Scenario planning has become especially important, increasing the need to future-proof the business for any challenges.
Given the overview of what fintech looks like today in 2020 and this evolving space: how would you describe this market over the next decade?
B2B payments is quickly becoming one of the largest industries in the world with a total addressable market (TAM) that is estimated to reach $1.5 trillion by 2028. With nearly 200,000 mid-market businesses in the U.S. and approximately 400,000 throughout the rest of the world, the potential is quite significant.
While large companies have been served well by financial institutions, and while small businesses have relied on self-service solutions, mid-market organizations – which are repeatedly crushed under the rise of regulatory pressures – have been underserved. Tipalti has been on a mission to relieve that pressure from day one, and we will continue this mission to ensure that mid-market companies are not left behind.
Going forward, I believe that AP is going to be redefined as a strategic enabler. Today, businesses mistakenly see it as a cost center. But it is an essential function that must be factored in when looking at how a company can scale.
Before we wrap up, would you like to share specific finance management or business tips for Marketing and Sales or Finance teams struggling through this uncertain time due to the Covid-19 pandemic?
The COVID-19 pandemic has impacted every one of us. And now, with economic uncertainty continuing to linger, many are concerned about what comes next. When we surveyed CFOs on the topic, 95% said their finance teams felt anxious about automation. Fifty-seven percent indicated that their team members had expressed concerns that automation would eliminate jobs.
These concerns are understandable, given the current climate. Employees may fear that when businesses express the need to increase efficiency, they are hinting at replacing humans with automation. But while there are still more questions than answers regarding this unpredictable pandemic, organizations will come to realize that automation is not a job replacer – it is a job enhancer. Companies should take advantage of it to bolster their teams, improve scalability and allow employees to flourish by focusing on higher-value tasks. In doing so, businesses will be better equipped to weather the storm of 2020 and embrace whatever 2021 brings.
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Tipalti comes from the Hebrew expression for “We handled it.” Tipalti does just this by providing one comprehensive, global payables automation solution that automates all manual supplier payment processes. Its customers typically wipe out 80% of their payables workload, enabling them to focus on mission-critical initiatives while doing more with less. Tipalti helps strengthen compliance and financial controls, avoid future AP headcount requirements, accelerate the financial close by 25 percent, and employ AP best practices.
Chen Amit is a veteran tech executive, repeat entrepreneur, and the co-founder and CEO at Tipalti, the global payables automation platform provider. Prior to Tipalti, Chen was CEO of Atrica, a Carrier Ethernet company that Nokia-Siemens acquired. Before Atrica, Chen was co-founder and CEO of Verix, a provider of business intelligence software. At ECI Telecom, Chen founded its ADSL business unit and led it from inception to $100 million in annual sales. He earned a BSc from the Technion, Israel Institute of Technology and an MBA from INSEAD.
