How We Built Aumico, a Thriving Startup in Financial Reporting: Lessons Learned from Our Iterative Development Process
In accounting, where meticulous record-keeping is paramount, an idea was born out of frustration and a quest for efficiency. The brainchild of Michael Schwander, a seasoned auditor, Aumico aims to transform the cumbersome task of preparing annual financial statements, a process plagued with errors and fragmented data scattered across Excel sheets and Word documents.
The journey took a crucial turn when Michael, in pursuit of a partner or agency to bring his idea to life, found Modeso. We recognized the potential in Michael’s vision and after an initial meeting, decided to embark on a joint venture to develop this solution.
A team led by Michael Schwander (CPO), Chris Zurbrügg (CEO), and Samuel Schmid, one of Modeso’s lead software engineers and now Aumico’s CTO started building the product to streamline financial reporting processes.
In this case study, we will delve into the challenges faced and the remarkable results achieved through collaborative efforts.
“We have a seamless collaboration with Modeso. Our daily stand-ups keep us aligned in just 15 minutes, and while we have scrum meetings, the team excels at self-organization. As a startup, roles overlap, and I personally handle organizing priorities. The team takes charge of executing these priorities and acting on customer feedback. Collaborating with Modeso’s team has been incredibly effective. We wouldn’t have accomplished any of our milestones without them at the helm of our development process.”
Chris Zurbrügg, Co-Founder / CEO at Aumico
Aumico was born to overcome spreadsheet struggles and fill the market gap
To prepare annual financial statements, accountants commonly use Excel spreadsheets, a process that involves manual adjustments without proper checks. Relying on these less-than-perfect systems not only results in low productivity but also contributes to inaccurate data. Plus, sharing data between sheets and integrating them with other business software becomes challenging.
Though numerous accounting solutions exist, many of them tend to be excessive, clunky, and outdated. Also, they typically fall short in catering to the specific requirements of small accounting firms and medium-sized businesses (SMBs).
Drawing on insights gathered through numerous conversations with financial experts and potential users, a team consisting of professionals with backgrounds in finance and business decided to develop Aumico. This unique product was designed to meet an unfulfilled demand and bridge the longstanding gap that existed in the market.
Target users and functionality
Aumico’s primary user base is comprised of accountants, serving the diverse needs of companies worldwide. They guide businesses through their year-end closing processes, ensuring accurate financial reporting. In addition to accountants, Aumico is also used by in-house financial departments at larger organizations.
To showcase a company’s financial health to auditing firms, accountants need to build financial reports, such as balance sheets, income statements, cash flow statements, and appropriation of profits. Aumico simplifies this process, offering an easy solution that ensures compliance with regional and international standards and removes the hassles of manual report creation.
Here is an overview of Aumico’s main features:
Guided financial statement preparation
Aumico simplifies the financial statement preparation process by providing users with a solution that guides them through each step. It eliminates the need for Excel, making the process more user-friendly and efficient.
Consistency checks for error prevention
With “Consistency Checks" Aumico automatically reviews annual statements for errors to ensure accuracy and prevent potential mistakes.
Multi-standard compliance
The platform offers compliance with various accounting standards, including GAAP FER, FER 21/26, and IFRS to allow users to align their financial statements with the specific regulations applicable to their business.
Financial statement customization
Users have the flexibility to customize fonts, sizes, colors, and logos, to create a financial statement that reflects their brand identity.
Compatibility with major accounting systems
Users can import data from their accounting tools to the Aumico platform. Aumico integrates with major accounting systems worldwide including Bexio, Infoniqa, Abacus, Xero, and Proffix.
From concept to market-ready solution
To build Aumico, our team employed our well-tested iterative approach, evaluating various ideas through prototypes until we arrived at the optimal solution.
Conceptualization
The inception of the project involved formulating a concept to guide our development process. Drawing on Michael’s expertise in financial reporting, our team crafted a roadmap for building the solution, ensuring it addressed the specific pain points faced by our target audience. Following this roadmap, we delivered a prototype that focused on the essential core features for preparing financial statements.
Prototyping
The initial prototype was a basic version of the future solution where users could import data from an Excel file, including balance sheets and income statements, and transform it into a PDF report. It targeted accounting firms in Switzerland. However, being a prototype, the system wasn’t perfect. The layout wasn’t polished and there were flaws in the functionality. This is typical for a prototype – we needed to release it to the market as soon as possible to gather feedback and validate the idea. Building this prototype was our way to understand what needs improvement and make informed decisions for development as we progressed along the roadmap.
User testing
Once the prototype was ready, Aumico’s product team conducted testing to verify the functionality with the intended audience – accountants grappling with financial statement complexities. Our development team at Modeso continued refining the product, incorporating valuable insights acquired through user testing.
Iterative development
Through the iterative process of discovery, prototyping, user testing, and feedback-based enhancements, Aumico evolved into a robust solution, reaching a point where it met the specific requirements articulated by the users.
Lessons learned from Agile iterations
The iterative development process taught us valuable lessons, particularly in understanding customer preferences.
Not all features we assumed would be well-received turned out to be universally useful. For instance, the cash flow statement feature, while diligently developed, was unnecessary because it was not a mandatory legal requirement for the majority of our customers. While this feature catered to a small subset of companies, its maintenance outweighed its utility.
On the other hand, we learned that despite some functional flaws in the prototype that users can tolerate, the final report had to be flawless, with a meticulously aligned layout. Users found any discrepancies, even minor ones, to be unacceptable.
Here are some more interesting insights about the “must-have" features that we’ve acquired during our iterative development process:
User Insight
Product feature
The desire for control over the UI
Users expressed a desire for greater control over the visual presentation of financial statements, seeking autonomy in designing layouts.
Customizable user interface
Based on user feedback, we introduced customization options, allowing users to incorporate their brand identity into financial statements, including font types, sizes, colors, and logos.
Diverse linguistic landscape in Swiss companies
Recognizing the diverse linguistic landscape in Switzerland, we understood that many international companies operating in the country may not have German as their native language.
Language options
We implemented language options, allowing users to generate reports in both German and English, eliminating the need for manual translation efforts.
Cross-platform financial report availability
Feedback from the target user group highlighted the need for better convenience and flexibility in using financial statements across various platforms.
Import/Export features
We introduced Import/Export features, enabling users to seamlessly transfer financial statements in and out of the platform.
The need for collaboration within accounting firms
Early on, we discovered that people in accounting firms required collaboration tools to work collectively on financial statements, but our initial prototype overlooked this functionality, as we initially deemed it non-essential.
User management functionality
In response to this insight, we implemented user management features to enable accountants to invite team members and collaborate on financial statements, fostering effective teamwork and streamlined processes.
Compliance for companies operating globally
With Aumico’s expansion, it became clear that aligning the solution with international standards, including IFRS, was necessary to cater to the needs of globally operating accounting firms and SMEs.
International accounting standards
We made the necessary adaptations to ensure compliance with international standards for accounting firms and businesses with global operations, meeting their reporting requirements effectively.
Tackling product development challenges
Although the iterative development process appears to be the ideal and low-risk approach for product development, it’s not as straightforward as it may seem. Here, we outline the primary challenges we’ve encountered in building Aumico:
Translating business needs into specs
CHALLENGE
Early on in our product development journey, we faced a hurdle: translating business needs into tasks that developers could understand. As Aumico founders lacked technical expertise, communicating effectively with the development team was a challenge.
SOLUTION
We brought in dedicated business analysts (BAs). Now, armed with clear and precise specifications, and adopting a collaborative approach involving continuous client communication from conceptualization to release, we’ve ensured a seamless alignment between business objectives and our development efforts.
Managing user feedback
CHALLENGE
User testing was a key component of our approach, but grappling with diverse opinions on crucial features posed a challenge. How do you differentiate between “must-have" and “nice-to-have" features when users perceive both as potentially important?
SOLUTION
We segmented the users by needs and usage patterns and assigned weights to their opinions based on factors such as expertise, frequency of use, and contribution to the product’s revenue. Then, we evaluated the potential impact of each feature on overall user experience and product success.
Prioritizing the right features
CHALLENGE
Figuring out which features to focus on and prioritize for development was a major challenge for us. Juggling our resources against potential gains, we strived to avoid investing effort in features that might not yield significant outcomes.
SOLUTION
To address this, we established clear and measurable objectives for the product and assessed how each feature contributes to these objectives. A cost-benefit analysis supported by user feedback helped us define high-priority features providing the maximum value with the least resource investment.
Continuous learning and adaptation
CHALLENGE
Product development is an ongoing challenge, and we’ve got to stay flexible and proactive. Failing to act on opportunities can lead to missing crucial momentum and potential success.
SOLUTION
Regular retrospectives, feedback loops, and a proactive approach to learning allow us to stay ahead in catering to evolving user needs. Experimenting is key as we adapt to changing market dynamics. It’s all about being open to trying new things in our development process.
“The challenge of selecting the right features is a constant journey for us. We validate ideas, create prototypes, and listen to client feedback. Every feature we develop is tied to our client needs and opens doors to new possibilities.”
Architecture and tech stack to ensure a secure and scalable environment
Our choice of the technology stack was dictated by our established expertise and the need to provide a secure, scalable, and user-friendly platform for accountants and SMEs. Here is what we used to build the financial statement preparation solution:
Architecture
Multi-tenant
This approach allows multiple clients, or tenants, to share a common infrastructure and code base while ensuring data isolation and security. By optimizing server resources and minimizing redundancy, the multi-tenant architecture contributes to a more sustainable and cost-effective solution.
Tech stack
Node.js and Angular
We used Node.js for server-side development and Angular for the client side, to build a robust and responsive full-stack application.
Deployment
Cloud and on-premise
Aumico adopts a flexible deployment strategy to cater to diverse client needs. Cloud deployment offers scalability, accessibility, and cost-efficiency, while on-premise deployment provides a localized and controlled environment.
Security
Advanced encryption techniques
Security is a paramount concern for Aumico because the application deals with sensitive data. The platform integrates advanced encryption techniques to safeguard all confidential information.
Getting ready for ISO 27001
As we’re preparing the product for ISO 27001 certification, a globally recognized standard for information security management systems, we adhere to stringent security protocols and industry best practices.
User management with Google IDP
We use Google Identity Platform (IDP) for user management, ensuring a secure and streamlined authentication process. Google IDP enhances user access control, simplifies user provisioning, and adds an additional layer of security to the platform.
OAuth and REST APIs for third-party integrations
To extend functionality, Aumico integrates with third-party services using OAuth and REST APIs. This approach enables seamless communication with external systems while maintaining data security.
Results: 4,000 recurring licenses and a growing customer base
Since its initial public market launch in 2022, Aumico has exhibited impressive growth.
Within its first years of operation, Aumico sold 2,150 recurring licenses to accounting firms. These licenses are fundamental to the SaaS business model, as each accountant needs a license for every company they support. Fast forward to 2023, and this figure has doubled, reaching a total of 4,000 licenses sold to date. With the increasing number of licenses, the pricing structure becomes increasingly cost-effective, encouraging broader adoption at a larger scale.
Aumico’s clientele has expanded to include 145 accounting firms, with the small and medium-sized enterprise segment experiencing notable growth and now representing 10% of the overall client base.
Modeso’s engagement with Aumico has shifted from a conventional client-developer dynamic to a true business partnership and we take pride in being part of this remarkable startup.
What lies ahead: Our long-term product vision
Currently, Aumico can be described as a productivity tool for accountants, but it has a more ambitious vision for the future. Recognizing the substantial value within financial statements, Aumico aspires to evolve into a comprehensive SME platform, empowering businesses not only by streamlining financial statement preparation but also by leveraging actionable data to enhance their overall business operations. This might include offering services such as benchmarking, company valuations, tax optimization, credit checks, and more.
“We’re on a mission to transform into an SME platform. Our vision is to unlock the potential of the financial data for diverse business purposes, from streamlining accounting procedures to offering insights for strategic decision-making.”
Goal 1: Expansion to other countries to broaden our reach
We’re actively expanding our services beyond Switzerland, forging strategic partnerships with major players in the accounting industry internationally. By integrating with major accounting tools, we aim to provide value with our reporting functions and enhance the overall efficiency of financial processes.
Goal 2: Building additional products tailored for SMEs
As our long-term product development goal, we’re working on expanding the feature set to encompass more than just financial statements. Plans include providing performance reports based on historical financial data and offering valuable insights for business owners and accountants alike.
