I’ve long been opposed to the fremium model – primarily because (in my opinion) people tend to equate no cost with no value.

A plucky startup from Canada, Wave Accounting, is hoping to challenge my assumptions, particularly in the SMB space. They’ve just launched an application that is interesting in two distinct regards:

  1. It tightly combined business and personal financial transactions. I posted about this awhile back contending that, for the smallest of businesses, the distinction between personal and business financial transactions is blurry at best. Every small business I know transacts business stuff on their personal credit card (if only for the air miles!). A tightly integrated application recognizes this. Xero has gone some of the way, creating a personal edition, but it is a distinct application and the integration between it and Xero’s business edition is marginal. Wave’s approach is very different, utilizing automatic bank feeds, transactions can be categorized at source as business or personal – it’s a truly novel approach and is really interesting (see screencast below).
  2. Free! It’s an approach that, in the personal space at least, Mint perfected but now Wave seeks to do the same in the business space. By aggregating and anonymizing data and running specific algorithms, Wave will provide users with highly targeted offers that are relevant to their business and business habits. Commissions from these products will provide the revenue stream for Wave, allowing them to make their product free for users. It’s a brave approach and the jury is out on how businesses will respond to an offering structured in this way, but in a marketplace with a significant number of SaaS accounting startups, providing a product free while still creating a viable business is a smart move.

This isn’t a detailed review – I need to spend some more time using the product to talk functionality, but from a business and go-to-market perspective, Wave is certainly doing things differently. Check out their video below:

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Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

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