Cloud Accounting Small Business

The Next Iteration of Wave: Small Business Financial Software

Written by Greg Lam

Wave Apps (formerly Wave Accounting) is software that’s grown on me quite a bit since I initially started using it five years ago. It’s gone through a few iterations and its now going through another one that I think is significant enough to write about.

Since the changes are ongoing (as is the norm with online software), this will not be an all-encompassing article. There’s no good way to talk about all that has changed and all that is to come. So, what I will focus on is the overall changes to the app(s) and the move that Wave has been taking into financial services.

Going Full Financial and Ad-Free

While Wave started out as Wave Accounting, it became Wave Apps after a bit of time. I believe this is because it had invoicing, receipts, payroll, and other small business apps that didn’t only do straight-up accounting. The two latest major additions to Wave have been Wave Payments and Wave Lending. While Wave Payments has been around for a couple years or so, Wave Lending is a new 2017 thing. Now Wave is into credit card processing and into business loans.

And when you see the name Wave, I should clarify that it’s not Wave that is directly providing these financial services. Instead, it has partnered up with a payment processor and a business loan company to process those things on the back end. But the front end, at least for payments, happens through the Wave interface. It’s tightly integrated, much more so than what you get when you use Stripe or PayPal as an add-on (which is no longer/was not possible with Wave).

Wave has always been free, and says it’ll always be. From the start they’ve shown ads alongside their software in order to help offset the costs of development. If you haven’t logged in to Wave recently, you may not have known that Wave no longer shows ads. Wave’s reasoning for removing ads and changing up their offerings is that they wanted to get away from the “It’s not bad for free” type of comment and also be able to use the screen real estate the ads were taking up.

How can this be if the service is to remain free? The answer is, of course, financials services. Since users are not forced to use Wave’s financial services, I think this is an overall win for both sides, Wave as a business and Wave’s users like you. I like how the lack of ads does provide a better and less cluttered user interface, and I think it brings an extra level of trustworthiness to the app.

I would be remiss to make you believe that the rest of Wave was previously free as well. They had payroll and premium support (which is no longer the case, as I’ll discuss below).

After years of watching software come and go, I’ll spout off and say that I think this premium service approach is a good strategy. The thing about really small businesses, the 0-9 employee firms that Wave targets, is that it’s hard to convince them to pay an ongoing monthly fee for a service for an activity that they’d rather not be doing — bookkeeping. I think early on in its life, being good enough and free was what Wave could provide and they thus succeeded in getting enough market share to survive. But going forward, I think they realized they needed to do more than that in order to continue.

While very small businesses are hesitant to shell out for pure accounting/bookkeeping software, there are a lot of services that they need on a more timely basis, such as payroll and credit card processing. Their businesses wouldn’t be able to run if they didn’t have them constantly available, as you need to collect money from customers on a daily basis and file payroll at least once a month. Accounting can be put off for a year.

When these services were directly integrated, they made life easier for the entrepreneur, as they didn’t have to use multiple platforms. And with the price charged, I think it was a fair enough price for users and I believe enough money for Wave to fund their business operations. Without knowing Wave’s financial numbers, I’d say this is a sustainable win-win.

With Wave’s latest offering, which is business loans, they are leveraging both the data they collect on their users’ businesses as well as the platform they have. Since they know a business’ true (or as true-as-can-be) numbers, they can team up with another company that can easily assess and dispense loans. From the small business owner perspective, this saves them the time-consuming and soul crushing activity of applying for a business loan. I myself have applied for a few in my time and it’s no walk in the park.

One premium add-on services that hasn’t panned out is their paid support. They’ve stopped providing this. Their official reason for discontinuing it is that they wanted to give such good service to all their members that the premium price paid for support wasn’t needed. My guess is that not enough people were willing to pay for premium support, and those that did probably demanded a lot of it. Moving forward with the free support for all models, all users are able to access chat, phone, and email support. Wave specifically told me that email response times have improved and are now usually within 24 hours.

Interface Changes

Along with the removal of ads, Wave has also changed their interface somewhat.

The most visible will be the navigation. The top navigation is gone and everything has now been moved to the left hand side.

Wave Apps

To get a perspective, this is what the old navigation used to look like (minus the ads that would normally show up on the right).

I like the change. It makes everything a lot cleaner and organized. In addition, if you  click on any one navigation item, you’ll get a list of sub-menu items.

This leaves the navigation neat and tidy, but doesn’t hide all the options too far away.

Another change is the “Create New” button found at the top right of the Dashboard.

Once you click on it, you’ll be able to see a list of transactions and items you can create. I’ve noticed this create button trend start with QuickBooks Online and it’s “+” create menu a couple years back. It’s been a feature that has since been copied by a lot of other software vendors, which I think is a smart choice on all their parts.

Wave’s feature is not quite like its competitors though, as the “Create New” button is only found on the Dashboard page. When you navigate to other pages, they will usually have a contextually relevant action button, such as “Create Invoice” when you’re on the Invoices page or “Add a Vendor” when you’re on the Vendors page.

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About the author

Greg Lam

Greg Lam is a passionate small business guy who loves technology and automation. He holds a BBA from Simon Fraser University, Canada. He's a Certified QuickBooks ProAdvisor, Certified Xero Partner, and Kashoo MVP. His business interests are focused on online accounting and how it can be used to streamline and automate a company’s accounting processes. He currently lives in Tokyo, Japan.

Greg operates the Small Biz Doer website, an "Entrepreneur's Guide to Small Biz Bookkeeping." He is the author of Online Accounting Software: Finding the Right Match, published by The Sleeter Group.

Connect with Greg on Twitter, Google Plus, YouTube, LinkedIn, or Facebook.

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