The service gives him everything he wants, and Pyles said his small business really doesn't have much use for a bank's cash management services anymore.
Pyles is partner and co-founder of Niche Modern of Beacon, N.Y., a hand-blown-glass lighting concern that grew explosively between 2005 and 2010. Revenue quadrupled, to about $2 million, over that time, and Pyles said he has gone from writing a handful of checks to vendors to paying around 300 bills and invoices each month.
To deal with the onslaught of paperwork, Pyles initially cobbled together an awkward system that flipped back and forth between Intuit's QuickBooks and Bank of America's small-business online banking.
"Until I found Bill.com, I was drowning in bookkeeping," Pyles said. "I did not feel like we were in a position to hire someone full time to do this." Pyles said his time spent bookkeeping has now dropped to about five hours a week from 20 hours.
For years banks have paid lip service to their small-business customers. They have served these customers either by dumbing down the cash management products for bigger businesses or by adding more bells and whistles to the standard consumer online-banking offering.
But small-business owners like Pyles have not been impressed. Many are turning to third-party vendors, which are innovating in the small-business online banking and cash management space at a faster pace than banks are. Experts say this momentum is similar to what has been happening in the consumer space for personal financial management, or PFM.
"So many financial institutions say they have a small-business service, but for the most part that is not true," said Jacob Jegher, a senior analyst at the research firm Celent.
"There are all these different services cropping up online by nonbanks in the financial services space serving small-business needs," he said.
Some bankers agree, and they said as a result, they have attempted to better attune their products to the needs of business owners.
"What many [financial] institutions have done is say, 'Here is our corporate offering; we will take away a few features and offer this to our small-business customers,'?" said Richard Weeks, a senior vice president and manager of the business segment strategy and support group for Wells Fargo & Co.
In contrast, Wells Fargo offers Commercial Electronic Office to 330,000 of its 2 million business customers who bank online.
Aimed at the upper end of the San Francisco banking company's small-business customers, CEO is a Web portal that gives entrepreneurs access to cash management, foreign exchange and trade services, desktop check deposits and lockbox services.
Bill.com gives Pyles and other small-business owners the kind of 360-degree view that PFM does in the consumer world, but with a lot more functionality. Among many other features, the product creates an audit trail of accounts payable and accounts receivable, and pulls from that information to generate a calendar that predicts a small-business owner's daily cash-flow position.
"This is all actionable information because you can, from the calendar, delay a payment or make a payment," said Rene Lacerte, chief executive and founder of Bill.com.
"So if an invoice is due tomorrow, but you know from talking to the customer he won't be able to pay, you can push this payment out a week, and it gives you a projected balance of where you are going," Lacerte said.
