 Live from San Jose, California, in the heart of Silicon Valley, it's theCUBE, covering QuickBooks Connect 2016. Now, here are your hosts, Jeff Frick and John Wall. Welcome back to QuickBooks Connect 2016 here, live in San Jose on theCUBE, watching theCUBE here, the flagship broadcast on SiliconANGLE TV, where we extract the signal from the noise, and along with Jeff Frick, I'm John Walls. Thanks for joining us here as we live stream. We're joined up by Karen Peacock, who is the SVP and the small business segment leader at Intuit, and small business Karen. You know, it's what the show's all about, right? It's all about bringing together 5,000 people from that burgeoning ecosystem. Yep, we seem to be growing each year. It's really exciting. It is exciting, and nice to be a part of it. So we're very happy to be a part of that. Tell me first off about the show from your perspective now, because it is growing. You've made a huge jump at attendees, programming's great, keynotes are great. Good. So it's all good. Glad you're having fun. So this show is all about helping small businesses be successful and connect, and connect with other small business owners, connect with accountants. Accountants connect with each other. Developers, so Intuit has a whole platform, and this is all about connecting together developers and accountants in small businesses to help each other thrive, because we truly believe we're better and stronger together. You know, one thing that I found interesting yesterday in the keynotes, a number of products were announced, new services, a lot of news. But kind of the range of partners with whom you're linking. So it was about Google Calendar, it was about Apple Pay, American Express, which is what I want to get to with you. But it really struck me about these really key partnerships that you're developing that really leverage this great power to the smallest of businesses, and afford them the same opportunities as the largest enterprise. That's exactly the idea. And with today's technology, that's possible in ways that it never was. 10 years ago, you could never imagine the kind of seamless integration that we can do today, where for example, you can go into QuickBooks and see any of the, you know, 10 different types of financing options offered from anyone from Funbox to On Deck to American Express to numerous others out there. So to have the ability to combine together solutions, not just that we build, but that are powered by everyone in this building and in the world to build on a platform, just extends the power and it helps us really help small businesses much more. So those are all a lot of great big words. But at the end of the day, big thing for small business, cash. Cash flow. Let's talk about money. How much money's in the register? Because I got money coming in and money going out. And really that's a huge part of, again, all the partnerships and solutions that you just outlined delivered, the best of, et cetera, is to help the small business get money faster, hold on to money faster and enable them to grow, which oftentimes is the biggest strain on cash flow of anything. Even more than failure, probably growth is a bigger strain on cash flow. And cash flow is one of the single biggest problems that a small business owner faces. And a typical small business who invoices for their income, which is almost half of small businesses out there, they do the work, they send an invoice and they have to wait an average of 28 days before they get paid. So imagine you've paid your employees, you bought all the materials, you even did the work and it's still another month before you get that money in. And we think that is just way too long. And so we've been working on driving innovations around helping small businesses get paid faster. And as of today, small businesses who use QuickBooks Online get paid twice as fast as others, which is a huge leap forward, getting paid two weeks faster, but we think we can do even better. And what we're finding is that small businesses who use our QuickBooks Online invoicing with electronic payments, 25% of them are getting paid the very same day. So the difference between getting paid a month later to the same day is tremendous. And there's more that we're doing here too, because for many small businesses, it's getting paid as a black box. And when your life and the health of your business depends on a black box, that's just not a happy place to be. And so what we have done, what we've just launched in the past week is a new capability called the smart invoice. And what the smart invoice is, is as a small business owner, you can send your customer an invoice. And then you can actually see when a customer viewed that invoice. So when you normally send kind of a paper invoice, there'll always be the question of do you get lost in the mail, or I'm sorry, I didn't see your invoice. Now there's no more question. I can see you viewed it. I can see you viewed it most recently two days ago. You can see when it's gotten paid, even before it hits your bank account, so you know a couple of days beforehand that it's in transit and you're going to get the money. So it gives you visibility into where your cash is at every step of the way. And we also make it easy to send reminders. So one click to send a reminder, automated reminders, that's often one of the most painful parts of a job for a small business owner is to harass their clients to pay them. And so we make that either an automated or a one click process for you to help ease that and help you get paid faster. It's so funny, just the consumerization of IT is a trend that happens over and over. And people know when somebody looked at their Snapchat, right, so I know when somebody opened the invoice. That's exactly what it is. The other theme, I'm reminded, there was an old early days e-commerce commercial. I don't know if you remember where they were sitting around their laptop and they just launched their new store and they get an order. And then an order. And then five orders. And then now they're happy. And then a thousand orders. And then 500,000 orders. And then 2 million orders. And now they're not so happy anymore. So again, on the cash flow side, there's not only the billing, but as you said, if you get a big order, you sell something to Walmart or Target or something, now you actually have to source the materials, build it, deliver it, and then wait for payment. So it begs that never-ending question financing. And traditionally small business, here's Silicon Valley, you've got a business plan and some connections. You can go get a couple million dollars on Sandhill Road. But if you've got a business that's been running for years and you get a big purchase order, it's hard to go down and get that money. You're not going to get on Sandhill. So you guys are really addressing that problem as well. Yes, absolutely. So financing is a huge pain for most small businesses. And in fact, what we found is that a typical small business owner, when they're applying for a small business loan, it takes them 33 hours to get through the application process. That's a lot of time. And once they get through that application process, most of them, over 60%, get declined. So that is a terrible trade-off. 33 hours to probably hit a brick wall is not where we want to be. And so what we've done is we've flipped that on its head and we've made the application process rather than 33 hours, a few clicks. And we've made the approval rates rather than most of the time getting declined. We've been able to, for our QuickBooks financing platform, make it such that the majority of our customers get approved. So we've got about 70% approval rates through our QuickBooks financing platform, which is awesome. And is that because, as a lender, I mean, do you have access then to look at accounting for that particular company and find out how solvent are they, basically how solid of a bet they are? That's exactly right. And so you always talk about, hear about the power of big data and what does that actually mean? And for a small business owner, what's the benefit for me? This is one of the pieces of benefit for you of data. And so what we do with our partners is, if a customer wants to apply for a loan, then they share the information that they want to share with the lender. And as a part of that, the lender gets to go through and see the information in QuickBooks that the small business has chosen to share and make the informed decision that way. So that's what lets us get to the much higher approval rates and done in a way that's completely seamless for the customer. That is so interesting because, you know, Jim, which is what I'm talking about before, and you have desktop application, all the data sitting underneath your, at least the coffin, I think, underneath your desk. Locked in there. Locked in there, but now, given choice, you can expose that to your potential lender rather than printing a bunch of stuff out and organizing your thoughts and running down to the bank and giving the guy the paper, he's got to go through it again. So you did, you completely flipped it up on its head. Absolutely, and in fact, one of the things that we've just announced is an extension to our partnership with American Express, where we are the exclusive partner for a new financing offering called American Express Working Capital. And the way this works is for small business owners who use QuickBooks online and who are American Express open customers, there are over 200,000 customers who are of both. They will have the ability to finance bills. So for example, if you, for example, get a huge order and you need to buy a bunch of inventory in advance before you get the money or you're stocking up for the holiday season, you can go ahead and make that purchase, finance it by getting a loan through American Express Working Capital and then pay it back, whether it's 30, 60 or 90 days. The two things that I love about this product are, number two, how easy it is. So it's just clicks to walk through that process versus your 33 hours. And that's very similar across most of our products in the QuickBooks financing platform. My number one favorite thing about this new product is the interest rate. It is an amazing interest rate. It's one half of 1% per month. So to put that in perspective, if you were to borrow $1,000 for one month, it would cost you just $5. And so the annual interest rate there comes out to be around 7%, 8% annually. And that is an incredible type of interest rate to get for a small business loan because you've probably seen loans out there. They can be as high as 100% annually or even more. So great deal, both easy, seamlessly integrated into QuickBooks and a good rate. So, good. Well, I'll say you've spent a lot of time now so you're making, you're saving money, you're making capital more accessible. What can you do for me to give me hours in my day? Yes, what I wouldn't give for another 10 hours a day. Absolutely. It just had one more hour or maybe five more hours a week. You know, if I didn't need to sleep, I could do so much more. So much more productive. That's right. But what can you do? What are you doing to give me a little time back? Yes, absolutely. So a couple of different things. First of all, we have completely overhauled the whole first use experience for QuickBooks. So when you are a new user going into QuickBooks, you will get a completely new experience as of last week and going forward, where we streamline basically your first experiences to get you as fast as possible to the benefit of how's my business doing. So you answer a few basic questions like your name, your email address, your type of business. You connect your bank account. You help us with a couple of categorizations of some of your money so we learn more about you. We do the rest of the categorization behind the scenes for you and give you a view instantly into your P&L or your profit and loss and how you're doing. So. Like a report card or school or some kind of a school. It's literally your income and expenses and the breakdown of are you making money? Yes or no? Here's how much and here's kind of where you're spending and here's where you're earning. Which is incredible to get that kind of value in just two or three minutes. And so look for us to keep doing more and more to make that first use experience better and better and speed up what we call the time to benefit because we are all very busy people. Let me give you two other examples. So that's great if you're a new user to get that first benefit. Another one is we have a lot of customers who use Google Calendar. Do you guys use Google Calendar at all? Absolutely. Yeah and in fact 56% of QuickBooks customers use Google Calendar. And if you're using that and you're somebody who bills for your time what you typically do is you're going into Google Calendar you're creating your appointments and then when it's time for invoicing which is often like nine, 10 o'clock at night. You know you're firing up your laptop, you're going in, you're comparing how much time did I spend with Jeff and John and then putting that all in and. Not enough. Yeah exactly not enough. Yes you should I would pay you to spend this time with you. So rather than having to go in and manually create those invoices and go back and forth which can just be not only time consuming but also very drudgerous. Not something you want to be spending your time on. Now with just one click you can bring all that information from Google Calendar over. It syncs it's two way synchronization with your client list. And so you can synchronize that. It syncs with your billing codes. So for example if you know if we're in this conversation you're like oh good Lord this is a really rough one. You can charge me a little bit extra for that and you can just do that straight in Google Calendar and it will pull itself into QuickBooks invoicing with just one click you review it and then send it out. So incredible time saver where you most need it at the end of the day. Which is back to getting that money in the cash register. I'm not sure Jeff but I think Karen just said drudgery, John and Jeff, not worth the time. Somehow I don't know if we came out slow on that. Never, never this was good. Long as it puts money in the cash register John. Enjoy that and congratulations on the show. Thank you. Lots of new products. I wanted to mention just on saving time is we are very focused on mobile first and not just as in hey I can do a few things on my phone but such that you should be able to do everything on your phone and actually more on your phone than on your laptop because on your phone you have the ability to do all sorts of location specific things of tracking where you are and taking pictures and snapping receipts and all sorts of things like that. And so we have been investing heavily in mobile and so what you see here is the ability for example to create invoices from your mobile phone. So you're out with your client. You're actually doing your invoice right then and there on your phone. You can kind of work through if there are anything that need to be changed rather than going back and again nine o'clock at night typing up the invoices. Now you're doing it right on your phone whenever you have free time. So so much more that's possible there. I know you guys probably live on your phone. I certainly do and I just expect that to continue. I need to move just away from him actually. Yes, exactly. Closing all the time. I thought he was like texting during this but. Jim McGinnis selfies, Jim McGinnis selfies. There you go. I think in general, it's simplicity in what you've done. And it's certainly I think it's embodied in everything you do. You make things simple. You save money, you save time, but you keep it simple. And free up the people to do what they got in business to do which is the passion of their business not the accounting and paperwork and billing and all these other things. That's exactly right. Karen, thanks for being with us. Thank you so much. We appreciate the time. Great to see you always. Great insights. Thanks for having us back. Back with more from San Jose Connect 2016. See you in a bit on theCUBE.