Getting Candid with Intuit’s CEO, Brad Smith

• The world’s borders have come down; there is no natural, geographic border to a Cloud product.
• End users do not want to be just consumers; they want to be participants in the development of the solutions. This is called “participation innovation.” Companies that are winning have customers that help drive product innovation.

• The mobile experience has won. Consumers want things at their fingertips. We all do!

• There is power in data…big data for the little guy. For example, there is power in finding ways to use data to help small businesses compare their performance to their industry peers, as well as offer real-time access to data—when the customer wants it.

Darren: We talked about a couple of Intuit’s core values earlier, but what do you see as Intuit’s primary mission?

Brad: It’s very simple. Our mission is to profoundly improve the financial lives of our consumers so they never want to leave or go back to previously used solutions. Our strategy is to use the Cloud across multiple platforms to accomplish this.


Darren: How do you feel the accounting profession is doing in keeping up with the rate of change?

Brad: What we see is that consumers actually change first and accountants and small businesses adopt new technologies second. We’ve seen this specifically with the iPhone, iPad, and Facebook. The rapid adoption of these technologies by the consumer pushed the adoption in small businesses and corporate America.


Darren: Those are great examples, and I agree. However, I also see a select group of accounting firms that do “get it” and are rapidly moving their firms forward. Do you see this?

Brad: I do. At Intuit, we actually have an acronym for this group—RTA…or Rapid Technology Adopters. RTA is Intuit’s buzzword for a firm that adopts new technologies more rapidly than other firms and . They are using the cloud and mobile solutions to be more efficient, save time, grow their practice and better engage with clients. But you know this better than anyone. You and your staff at RootWorks are leading the pack in this area.


Darren: Intuit is obviously leading the way with many of the technologies accountants and small businesses use every day, so why not just declare that it is now time to move to the Cloud and everyone should just get over it?

Brad: Moving to the Cloud definitely has its advantages, and we are moving quickly towards it and focusing our innovation resources there, but Intuit will never force a product, platform or business model on a customer. We will leave no desktop user behind, but we will help them see how connecting the desktop data to the cloud where it makes sense is like connecting chocolate with peanut butter. Great on their own, but even better when you put them together.


Darren: You live and work in what I consider one of the best places in the world. You have a vibrant and youthful culture all around you. What do you hear when talking to the younger generation about entering the accounting profession?

Brad: That’s a great question, and we do talk to this group. What I hear is this: “I just inherited my father’s firm, and I want to keep the firm alive, but I don’t want to work the way my father did.” They are referring to the crazy hours during busy season and being chained to a desk. The up-and-coming generation of accounting professionals want to work differently. They want a new model. They believe in the “virtual office,” and the Cloud is a big part of that model.


Darren: With the Cloud being such a big part of Intuit’s strategy, how do you see QuickBooks Desktop playing out in relation to QuickBooks Online?

Brad: QuickBooks owns 91-92% of the small business software marketplace. Between 2005-2007, we dedicated 75-80% of our engineering resources to desktop and a much smaller percentage was dedicated to the Cloud. Today those percentages have reversed—75-80% of our engineering resources are invested in Cloud development. I think this clearly represents our focus and our commitment to moving online.


Darren: That’s a monumental shift in resource allocation. Do you see new desktop software being built today?

Brad: I do not. Today we see vendors maintaining their desktop software while using the Cloud to build future solutions. We’re also seeing 3rd party developers getting into the fray to develop solutions that connect into our core products. What’s great is that they’re focused on problems that we either would not or could not develop solutions for, so that’s great for customers and also means our products actually get better while we sleep!


Darren: QuickBooks Online has traditionally lacked some functionality. Do you see this changing?

Brad: I agree. QBO has lacked some functionality, but that is changing. As I mentioned before, we have reallocated our engineering resources to focus on the future and we believe the future is the Cloud. We are on a four-week development cycle, so every four weeks you will see new enhancements to QuickBooks Online, many of which are based on feedback we’re getting straight from accounting professionals. If you haven’t checked out QBO in a while, we encourage you to take another look, or talk to a peer or colleague who has.


Darren: How many customers are using QuickBooks Online?

Brad: We currently have more than 350,000 licensed QBO customers, more than three times the number of customers we had at this time last year.


Darren: With the functionality of QuickBooks Desktop and the fact that many customers and accounting practitioners are familiar with it, what I’m seeing is a move from desktop software to authorized Intuit hosting providers that offer the benefit of online collaboration. Why did Intuit choose to go with an authorized hosting program instead of hosting QB internally?

Brad: Strategy is not only what you are going to do but also what you are not going to do. We felt partnering for hosting was a better strategy because it allowed us to keep our engineering resources dedicated to developing the Cloud platform.