The Modern CPA Success Show: Episode 126

Blagoja Hamamdjiev, founder and CEO of Modeliks, joins Tom and Adam to discuss the benefits and features of Modeliks software for startups and small businesses. The conversation highlights driver-based financial planning, integration with pitch decks, and the creation of investor-ready business plans. Blagoja emphasizes the software's efficiency, cost-effectiveness, and dashboard functionality. He also touches on multi-user collaboration, AI integration, and upcoming features like multi-dimensional planning and QuickBooks integration. The episode underscores the value of Modeliks for financial planning, reporting, and advisory services, and the importance of ongoing support and user education.

Intro (00:00:00) - Welcome to the Modern CPA Success Show, the podcast dedicated to helping accounting firms stay ahead of the curve. Our mission is to provide you with the latest and greatest insights on cutting edge tools, innovative marketing strategies, virtual CFO services, and alternative billing methods. Join us as we change the way people think about accounting.

Tom (00:00:22) - Okay.

Tom (00:00:24) - Adam, we've got an episode coming up that really touches on some of the things that we really like to talk about. What do you think?

Adam (00:00:30) - Well, a couple things, really. First of all, we're always looking for, you know, streamlined technology to deliver services to help them make more efficient and then, and I think our guest today is kind of that crazy mixture of great advisor, you know, lots of experience doing the advisory stuff, but also really technical. Then you know, we've got a couple of those people on our team. They're unicorns. Whenever you get those people to actually be, you know, moving software forward, it's pretty exciting because they can see kind of both sides of things. So, I thought that was huge and then just hearing him talk more about like the drivers and getting really passionate and excited about that. I mean, you know, again, that's kind of near and dear to our hearts. We're always, you know, really talking about getting intentional with the numbers, so, I thought that's pretty cool too

Tom (00:01:19) - I thought so too, and he's got what sounds like a great product. He mentions the pricing at the very end, so I hope people have some interest. The pricing was impressive, and that's one of the common things that we get around, sort of what do I put this thing in? So, I hope people really get a lot out of this episode. So, enjoy. Today we're going to get an international guest, so I'm really excited and you'll get to meet him here in just a moment. I'm Tom Walton, I am joined by my usual co-host, Adam Hale.

Tom (00:01:48) - Adam. Welcome today. So, our guest today, Blagoja Hammam Jev, is the CEO and founder of model X. Welcome to our show Blagoja and by way of introduction, can you tell us a little bit about just your personal story? And then we'll jump in and talk about more company and our other topics.

Blagoja (00:02:10) - Great to be here, Tom, and thanks for inviting me. yes. A quick introduction about myself. I, as Tom said, I'm the CEO and founder of modeling, which is a business planning and an investor reporting software for startups and SMEs and, you know, I've, before starting modeling, I, I've been all my life. I've been trading financial plans and pitch decks for different projects, pitching it to people in order to fundraise for those projects. So, my whole life, probably 20 years I've been, I've been, I've been pitching ideas and fundraising and, and with that experience of, of 20 years, I decided that that I want to take that experience, that knowledge and turn it into a financial planning and a business planning product so that every entrepreneur in the world can actually create professional business and financial plans, instead of in order to be able to, to plan and manage their business better.

Tom (00:03:05) - Excellent. And I did see the background. You started early in your career with Ernst and Young. Right. So, you've got some big accounting firm experience in addition to working with small companies.

Blagoja (00:03:15) - That's right. Actually, Ernst and Young, I started with young. I was, I was an auditor in, in Austria for my first few years of my right after school, first few of my years of my career and then I went, I did a couple of other things. Then I went back into Ernst and Young, towards the end of, well, I guess 15 years later, where I was the director of the business. Business planning, engagements in, or the business planning team within the within Ernst and Young. So, every engagement that was that had to do with the, with the creating a business plan or financial plan for, or business plan for, for a client in the retail sector and the technology sector in the whole of the Middle East at that time, was under my, under my responsibility, I guess so twice Ernst and Young.

Tom (00:04:04) - Sounds like great learning. Okay, we'd love to hear more about model X. And before the show started, I was asking you about where you're located, and you also gave me some idea of just the global nature of your company. So, just be interesting as you talk about, I'd love to hear more about where you are, where your team is, as you did before, to give people an idea how global it is.

Blagoja (00:04:22) - Yeah. So, it's I guess it's a, it's a, it's kind of a model startup, and most startups that I actually speak to today, they're structured in the same way. So, personally, I'm based in Skopje, Macedonia, which is in Eastern Europe, and I sit here with my development team, where, where we develop the software but then I have my product team or the design team is in Germany, in Munich, I have my QA team sitting in a, in the, in Denmark and I have, salespeople sitting in actually in Dubai in, in the Middle East.

Blagoja (00:04:50) - So across the world, my company is, model is incorporated in Ireland and I have investors from around the world I have investors from the US, actually from Europe, from the Middle East, from almost everywhere. So, it's a truly small startup, but at a with a global footprint.

Tom (00:05:10) - I love it. And is it a remote company? Is that or do you have office space?

Blagoja (00:05:15) - No. So, we have office space. Here is where most of the developers sit here. It's we go to the office. I'm in the office right now, but everyone else around the world is definitely remote. We don't have offices around the world.

Tom (00:05:28) - Okay? And we are similar in that we are a remote firm. And as we merged with Anders, a couple of years ago, they have an office and so, the company has an office in Saint Louis but most of our virtual CFO team is either remote or some hybrid with that office. So, some similarities there.

Blagoja (00:05:44) - You know, it was four years ago. It was impossible to I guess it was impossible. It was possible. But it was very difficult to think that it will come to this situation where it's completely normal to work everyone, to work from home and work to get done but I guess that's one of the positives from, from Covid, times. Now it seems that it's completely possible and offices are quite empty, to be honest. People don't want to go to the office.

Adam (00:06:08) - We. That's right. We finally got the stragglers. So, us like you have been doing that for a long time, so we just had those last few people sticking to their guns, and now Covid pushed them over the edge, and now it's commonplace. So, which is great but, yeah. So, I mean, I'd love to learn a little bit more about, you know, because I think that what you're what I hear you saying is this isn't just for startups, right? That's kind of where your experience was in the fundraising side.

Tom (00:06:39) - But there's obviously a ton of value to being able to look at this kind of modeling on a month-to-month basis, even within a normal kind of small business, if you will and so, you know, some of the things, you know, talking about, how could somebody use this, this tool for their advisory business, even if they aren't necessarily doing it just for like a pitch deck or doing fundraising. 

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Blagoja (00:07:46) - So, let me just step back a little bit and tell you what are the main things that Molex helps users?

Blagoja (00:07:51) - And then I'm going to come back to the whole advisory question. So, modeling helps users do four things. It helps them create a five year, 3- or 5-year financial plan for their business. It helps them track their actual financial performance against that plan. It helps them create an investor ready pitch deck, and it helps them create a bankable business plan or a long form written format of business plan. So, those are the four things financial planning, financial reporting or management reporting, pitch, tax and business class. Those are the four things. Now who is it for? As we mentioned, as I mentioned earlier, it is for startups and small businesses as the end user. But what I find from my customer base, about 25% of my, of my customers are actually consultants and the companies themselves that use the software, and they actually use it for the reason that you that you mentioned for providing advisory services to their clients and when I talk about advisory services, I see two specific advisory services being, being or being that is used for providing one financial planning and budgeting.

Blagoja (00:08:57) - So, full financial planning process, financial one year or five years, plans and budgets that account specifically but also consultants, help their clients create their small and medium size, well, starting small businesses, as their clients. So, financial plans and budgets, number one and number two, which I find which, which I find quite interesting that I didn't expect it to happen. I see, I see that consultants and accountants start using it for regular monthly management reporting services to their clients. Because, you know, when you create financial plans and budgets, very often you create it at the beginning of the year, and then maybe you have to revise it every, every quarter or maybe every half a year but management reporting is something that you, you, you provide as a service on a monthly basis. So, it. So, the whole management reporting service is a more engaged service on a more regular basis than, than, than financial planning. So those are the two services.

Blagoja (00:10:01) - It's financial planning services or budgeting services and management reporting services for clients is what accountants and advisors, business advisors, use models for and the one thing I want to mention, the reason why modeling is well and static. My goal for modeling is to be the number one business planning or financial planning software in the world for startups and SMEs. I'm not going into large corporates, but the number one solution for startups and SMEs and the reason why I'm confident that this is where we're getting to is because of one, one specific, one specific benefit once the specific feature of monoliths and that's the ability that it allows, either SMEs or end users or accountants and consultants to create driver based financial plans for, for their businesses or for the clients. So, driver-based, driver-based financial plans are the only type of plan that any company should be creating in order to have a properly done financial plan and budget for them. Now, what does the driver based financial plan mean? That means that you build your financial plan based on the activities in your business, the operational activities or drivers in your business that have the highest impact on the business results for your business.

Blagoja (00:11:32) - So, once you create a financial plan that is based on the activities, the operational activities, that's when you can actually truly manage, manage your business, assign targets to your, to your team and improve your business on regular basis. So, and I'm going a little bit more detail on this driver-based planning because this.

Tom (00:11:53) - Is great.

Blagoja (00:11:54) - Really for me the most important thing is the only way that anyone should be planning. So let me give you an example, a real example of what driver-based planning means for the audience to understand me better. So, let's say a business is let's say a software business, like models we are selling we're selling software, right? So, let's imagine we have we have a for next year. We have a revenue target of €1 million for sales. Yeah. So, we're going to calculate that revenue for software sales based on the number of clients that we have multiplied by the average ticket size required. Yes. But now to come to the number of clients that we need, I would actually want to calculate that number based on two specific variables or drugs, and that is the number of leads that I need to generate.

Blagoja (00:12:38) - And then a conversion rate from a lead into a customer. Now we split and now we split the number of clients into two important drivers, the number of leads and conversion rate. These are two things we can control: then suddenly, the number of leads will impact the number of salespeople you need, the more salespeople you need, the more leads you need. It impacts also the marketing budget in order to bring those leads. There's a marketing cost to it and then the number of clients that you have actually impacts the number of customer support people that you need in your team. So, you see the business is the operations of the business. They are all interconnected, and a financial plan needs to be built with those connections in mind. You need to build it based on those activities and this is what modeling allows you to do and there is no other software for startups and, and small businesses that allows you to create a financial plan based on the drivers specific to your type of business.

Blagoja (00:13:45) - So, that's for me the, the crux of why we get why we get, business advisors and accountants using modeling to provide, higher, higher margin advisory services, financial planning, advisory services because of the driver based financial planning logic that it has built, has been built into it.

Tom (00:14:08) - Yeah, I really like that. The. If you were to listen to the courses that we teach around forecasting, you would hear Adam passionately talking about, hey, the very first step you do in the forecast is and we mainly focus on revenue initially. What are the drivers did you have and I'm sure you've had the same experience, but you can talk to a business owner who says I made $2 million worth this year. My goal next year is to do 2.5 million. Wonderful. Once you start breaking down what you're saying, the drivers do that. That's the real conversation, right? Can you really grow your existing customers? Can you find the new customers and things? And I really like that you're getting back to.

Tom (00:14:43) - So, then how many actually target prospects do you have to get at a certain conversion rate to do that? But those for us often become the real key metrics that you're going back to the owner and saying, let me tell you the story about your business. The dollars are kind of the result of that, but did you or did you not hit those drivers to help them understand what's really going on in their business? So, I like that you got that base.

Blagoja (00:15:06) - Because if you don't, if you don't, exactly. Because if you don't break down the business to those to those drivers, you can't really properly manage it, because let's say you had a target of whatever, 100 customers and you reached 50. Okay. Now is it because you didn't bring enough leads, or is it because you brought a ton of leads? But your salespeople are just terrible and they're not able to convert them. Now, this is important for you to measure, to measure your business, to know maybe you're generating a massive amount of great leads, but your sales team is terrible.

Blagoja (00:15:37) - Yeah, or maybe it's the other way around. So, you, when you break it down to the drivers from the activities, you're able to manage and improve your business.

Adam (00:15:45) - Yep. You're speaking our love language for sure. yeah. We definitely like talking about drivers having a really intentional and deep understanding of how the clients make money and then and then obviously from there you can follow every dollar into the so, I assume that the software is also dynamic enough. Like can you tie the expenses related to the income so that when the income moves, then some of the expenses will move, you know, kind of those kind of things. Yeah.

Blagoja (00:16:13) - So, the Navic model everything. Everything is interconnected with each other. Yeah.

Adam (00:16:17) - Okay. And then and then it does have the ability, then to kind of template out a pitch deck as well as a, so a pitch deck as well as a business plan for a bank.

Blagoja (00:16:29) - Yes. So, the so the financial, the financial tables and charts, they're directly integrated with the pitch.

Blagoja (00:16:35) - The pitch deck obviously has, the pitch deck has a, has a structure and a design that that you can use to, to fill it out, to fill out the pitch specifically for yourself and then the financials are automatically linked. So, anytime you change anything in the financial module, it automatically changes your pitch and your business plan. So, there is there is no chance of having, you know, old numbers in your pitch deck and the business plan are always interconnected with your financial plan.

Adam (00:17:00) - Yeah, I think that's really unique and important. I mean, even if it's not a startup or you're not doing fundraising oftentimes, obviously you're having to go raise some money from, you know, go to lenders and try to figure out those kind of things and it's good just even sometimes, looking at that from 10,000ft (about 3.05 km), I think sometimes having that kind of perspective in a client relationship, you know, you're talking to him and you're like, hey, like, let's look at it from an investor because as a small business owner, you kind of are you are an investor of your own company, right? So, it's good to kind of see that perspective and kind of see that, in story form in terms of a pitch deck or a business plan.

Adam (00:17:38) - So, I think that's a really cool, and much needed integration, because a lot of times what we find ourselves doing in the advisory world is we're supporting that concept. So, a client will come to us and say, hey, I need to put together a pitch deck and we're like, okay, first we need to start with this forecast and so, we'll go through this whole big process of putting that together, and then it's like, okay, cool. Now we have to figure out what from that, we're going to take and then put into the business plan or put into the to put into the pitch deck and that is, you know, frankly, that's kind of an overwhelming kind of thought or task, and it's wildly inefficient and to your point, if things change, then you got to go update them and do that kind of thing. So, I think from that perspective, I agree. That is a I mean, there are forecasting software's out there that get into the drivers there three-way statements.

Tom (00:18:27) - You know, you get the balance sheet, the income statement, cash flows. You know those exist but, and some of them have better reporting than others but, but they definitely do not have like the business plan integration and the, the deck that, that I've seen. So, that, is pretty unique and pretty cool.

Blagoja (00:18:47) - So, let me, let me just add one thing. Yes, there is software out there that, you could helps you create that you can create a driver-based, financial planner for sure but there are two differences from that software to models. The first difference is that they cost $25,000 and up. Yeah. If you get any software that allows you to do a driver based financial forecast cost $25,000, let's say $20,000 and up per year. Modeling is more or less cost 20 times less than that, actually, at the moment, 40 times less than that. So, that's the first thing. The second thing is, and this is very important. We build predefined financial models within models by industry.

Blagoja (00:19:31) -And so, I've spent 20 years building. I don't know how many financial models I have built in my life in Excel. Thousands. I can't even count them, but so I. So, what we do is create financial model templates by industry within models. So, let's say you are a well you're a SAS business. Let's say like models. You go into models, and you say, okay, the first question, one of the first questions is going to be, do you want to start from a predefined financial model for your industry? And you say, yes, you start. And the whole driver logic that we've been talking about for the last 15 minutes is already pre-built for you. Within the model, it's all the connections of revenues with cost, with number of leads, with clients, with everything. Everything is already pre-built. All you need to do is start inputting assumptions around those around those drivers. And you have your financial model, professionally built, driver based financial model done within. I mean, I do it in 30 minutes.

Blagoja (00:20:26) - Probably takes a day or two for users but you do it so quickly and you don't need to have you don't need to spend there. So, the reason why I started Nomics is because it took me three weeks to create a proper financial model in Excel for every new client. If we're talking about a serious financial model with, with, with all the statements, with charts, outputs, with drivers specific to their business, it takes me 2 to 3 weeks. And I am an expert in this field in modeling with the predefined financial model template you have that handed to you on a plate. It's ready. Just input assumptions if you need to add any. There are some specific specifics for your business. Add new ad revenue streams, add costs but 90% of your model and the driver logic is already pre-built. So, you start with a with a professional financial model by industry and for and very often, some of our accounting clients or, and consulting clients that we have, they will call us, and they'll say, look, we have 20 clients in the let's say, restaurant business.

Blagoja (00:21:36) - Can you please create a financial model for if you don't have it, can you create a financial model for this industry, for, with the knowledge. I sit down, I take a few days. I have a lot of experience. I take a few days, I create a professional financial model, and then they. Then they can offer that same model. Well, with tweaks to 20 clients of theirs. So, this is the efficiency that you can get that you can get out of tools like models in this, in this case that you have a fully pre-built financial model for your industry. And if you don't have it, tell me and we'll do it and you can, you can offer that that financial, that financial plan, that financial model to as many clients as you want because we've done it once and you have it, for, for your clients. This is where you get efficiency, and this is where you get a high margin advisory business using such a tool.

Tom (00:22:31) - Yeah, I like that approach. You know, we work with a couple of different niches, but one in particular, and when we work in our niche, they can see the experience because we've got those models to say and so oftentimes, we're saying here's the information that you'll want to be tracking and give that to them. I like it when it's a new one that you've already got a template that you can step in feeling smarter about how things would work within a client. Exactly. That's a really good approach.

Adam (00:22:56) - But I still like my flexibility of being able to add my stuff. So, it sounds like that's good and speaking of flexibility, I mean, how does that work with. I mean, is your, is your product pretty? Is it pretty flexible in terms of software and things that connect into it? Like how does the data feed into it? Can you feed into the data through GC? Can you do it through Excel? Can you do it through a bio link? Like how does that work? Yeah.

Blagoja (00:23:20) - So, at the moment you can either input data or you can upload an Excel sheet. So, you can download the template from models with the with the right structure. Then you put in your number, download an Excel template, basically input your numbers. Then you upload it back into modeling and you have you have it in there. But and just, I got to say this I didn't mention before, we have been live only for four months. We are a very new company. to the to the market. So, we've been live for four months and QuickBooks integration is the first thing that we are working on right now. So, in about three months from now we're going to have a QuickBooks integration. Zero comes right after that, and then we'll see what else we need to create. Extremely important I know, and we have a big focus on accounting integrations, but they are coming in about three months from now.

Adam (00:24:09) - Okay. Yeah. That's great. I mean, because that's important too, is, I think, ease of use in terms of how we do that stuff is, is extremely important.

Adam (00:24:17) - Because I think that also what we find in this space is that and we experience it for ourselves as well, is people are like, I am not you. You know what I mean? Like, I get it like, you know, you're one of those unicorn people that both get the financial side and the data side, which is great. And we have a couple people on our team that are like that, but for the most part, you're, you know, you get the person that's like really good at the programming side but couldn't speak advisory stuff to save their life and then or the other side of the, the, the table where it's like, yeah, I'm enough. I know enough to be dangerous. Like, I can open up the software, I can log in, I can add a few drivers, but you got to keep it really simple for me, because I can use the information really well, but I don't necessarily want to be a data programmer in order to build it.

Tom (00:25:00) - And we see that being probably one of the biggest, you know, whenever you're talking about the more comprehensive software, sometimes that's a little bit of an obstacle for them, that user experience side.

Blagoja (00:25:11) - And it's and we've done so much testing with the, with the, with the end users in order to get the right, right customer, right customer journey, I guess within the software and you know, I can when I look at the software, I still see things that I need to improve and that's a continuous process but what I have realized is that that, the more complex the, the more features you give, you think you're helping, you're helping the user, but you're really not helping you, just making it more complicated and they, they start getting scared of, of using the product. So, what I have tried to do is to include, in terms of the feature set, really the most important things that that you would need to have a professional financial plan, driver based financial plan, but not complicating and more of that might actually I always like to say this, that my, my, my design philosophy for modeling is that, I've designed it to be as simple as simple as possible, but not simpler than that.

Blagoja (00:26:14) - So, it has to be, it has to be useful, it has to be.

Tom (00:26:20) - Right. Let's say that no 100%.  I mean, that's why I say sometimes the complexity can be just overwhelming. But the technology, too, and I don't want to have to go to ten different screens in order to get something to populate on this one number. That's also super frustrating. So, the data input has to be pretty solid, but I mean, I think for the most part, you know, getting an export out of QVO into a format that's easily uploaded as is something that's pretty common knowledge for most people in the space and it's not a huge lift. It'll be nice, obviously, once you get that connectivity, I'm sure but yeah, having the ability to do that. So, I do want to kind of pivot and go back to, I mean, like I said, what I do think is super unique is obviously the pitch deck and the business plan and I can't tell you how many times I wish I had those integrated into our forecasting tools.

Adam (00:27:07) - Because it does come up like at some point, at some time with any of our clients, it seems like that's always a conversation. You know, some there's always an end or there's always a need for cash, whatever. So, having that. Right. Yeah. And it's simple.

Tom (00:27:21) - Isn't it always the last minute, Adam? When it opens up, it's like I need this tomorrow, right?

Blagoja (00:27:28) - It's not yesterday. It's tomorrow. You're good.

Adam (00:27:31) - Yeah. Yeah. It's like. So, you think that you can get that done by, like, next Tuesday even and I'm just thinking to myself, I got to go investigate like, what a deck looks like, all that kind of stuff. So. Yeah. So, it's difficult. It's a difficult thing, for sure. So, I do love that, but I do want to kind of circle back around for making sure it's practical use every single month, you know, how would you can you kind of walk us through how I would engage the software, in order to support a client, like from a monthly and advisory kind of perspective.

Blagoja (00:28:12) - Yeah. So, one of the so the fourth I guess tab in the software is the, the fourth, fourth functionality is the whole dashboard functionality and what this allows you to do is, allows you to track your actual financial progress, actual results, compare them to your plan to previous periods and the previous year and I don't have to explain to you at least guys what that means. So, it's a full variance analysis on all the financial statements of PNL balance sheet and cash flow statement through variance analysis across those four periods actual forecast, previous year, previous period. Then we have more than 50 50 charts again, for every part of your business. So, every chart you can imagine that you would, you would, you might need to understand how you feel. This performance is already in there again comparing actual versus forecast or actual versus previous periods. So, every, all charts automatically calculated presented for you. Then you have ratios. You have 16 of the most important ratios. All your margin ratios, all your so profitability ratios, return ratios, leverage ratios and liquidity ratios.

Blagoja (00:29:22) - So, 16 ratios everything automatically calculated and then custom KPIs. Create a list for the with the most important KPIs. The operating drivers that we're talking about. Create a list of those drivers so you can track them monthly, and then the final step is manager reporting. Once you have your dashboard, you can create a custom dashboard. You have a custom dashboard with the charts and tables that you want to report on a monthly basis, on a regular basis and monthly level and then from that dashboard you create your management report where you have all the charts, all the numbers are in there but when you report to a board or to or to investors or to whomever, just having the numbers doesn't. It's not enough. You need the explanation behind the numbers. You need to explain to them, to that board member, why the numbers? Why is my revenue 30% higher than what I expected? It's great news but he still wants to know why, right? So, in modeling, what you would do is you would you create.

Blagoja (00:30:20) - There is a management reporting template where you have all the charts and tables with all the numbers, and then you have space to provide the context behind the numbers, the reasons why the numbers look like they do. So literally it's, it's, it's a tool that helps you plan then report and plan and report on monthly basis. Create management report on monthly basis with numbers and explanations why the numbers look like they do. So, that's why that's how you if you're, if you're an accountant, that's how you use models to have interactions with client and provide client services. Management reporting services month by month, by month, By month. Or a virtual CFO. Services of two smaller companies, not virtual fractional CFO services. You have the full. You set up your reporting, and you have everything that you need with a few clicks to be to be able to present a full management report to your client. I hope that answers.

Adam (00:31:20) - So, yeah. So, I mean yeah, it does I mean you're obviously a super smart guy.

Adam (00:31:25) - You've been able to build this kind of thing. So, you're leaving me some space for me to do my review. Right. And for me to type that information in there have are you thinking about or, you know, we're, you know, we're, like, kind of in the infancy stages of AI like, have you been starting to think about how to tap into that to be able to, at least as a starting point, you know, again, thinking about efficiency, right? Like for you to be able to integrate your software and be able to call out, you know, these drivers are the reasons why your revenue was up 30%.

Blagoja (00:32:01) - Yeah. It is in the planned to release the first, first I, I integration of first AI features towards the end of this year. There is a lot to like, my list of things that I need to do with this software. It goes. It doesn't end. It has, for the next five years, I have a task for my development team.

Blagoja (00:32:24) - I am one of the most important ones that is coming towards the end of this year both in generative, generative writing of speech, text and business plans. Basically, as a few questions, you click, you click generate pitch deck, book your pitch deck. So, from that perspective, from the financial part perspective, things like, things like suggesting which drivers suggesting what kind of revenue streams, costumes you should have in your business if you are not starting from a template and as well as, AI analysis of numbers in terms of benchmarks and this is extremely important. So, finding benchmarks and benchmarks is extremely difficult too, to have that extremely important as well, because every business, every location is different, and anything can be a good or bad benchmark but to start off, I think just at least to get a sense, benchmarks are important. So, I for, for doing research for you in terms of finding benchmarks on your financial side is one is the other thing that we're, we're, we're looking to do towards the end of the year.

Blagoja (00:33:23) - But as I said, there's hundreds of things to, to do, to make, to make more list of the, the number one financial, business and financial planning software in the world.

Tom (00:33:36) - So, the people using it blog I'm curious accountants and advisors as opposed to entrepreneurs doing it on their own. What is the mix of your model X users?

Blagoja (00:33:47) - 25% is A is advisors, 75% is entrepreneurs okay at the moment.

Tom (00:33:52) - Okay. Yeah. What is it? So, I think, you know, we do an awful lot of coaching of other people trying to get them into advising and our main services advising clients. Why do you think so many CPAs are kind of holding back on the advising or not jumping into doing it? Because that's been our impression is there's a lot of talk about advising, and we meet a lot of people who aren't jumping in to do the advising.

Blagoja (00:34:15) - I have a hypothesis and you probably know this better than me, so it should be an interesting discussion. My hypothesis is that creating an again depends what kind of advising, but let's talk about financial planning or financial planning advisory.

Blagoja (00:34:29) - Creating a financial model a driver based financial model. In Excel. It's difficult and it takes a long, long time. So, if a CPA needs to create a financial model in Excel, he probably needs to go back to the client and say, if it's a small client, if it's a small business and he needs to say probably, yes, it will cost you $10,000 or cost you $20,000. And that's probably too expensive for a small business. For a for a financial model, I that's something you probably know this better. This is my hypothesis. I think it's just creating a proper, proper financial plan, proper financial modelling. Excel. It takes so long that it requires quite significant knowledge of financial planning. It's also not that you need to spend time as a, as an accountant. You need to learn this. You need to learn this skill. It's different from accounting, at least in my opinion. So, I think it requires a specific type of knowledge that you need to spend time and game at the same time with the amount of time it takes to create just one financial model.

Blagoja (00:35:31) - This is what I think, it stops accountants from going into at least financial planning and financial modeling. financial modeling services.

Tom (00:35:38) - I yeah, if I can just comment. What do you think? I agree with you. Well, Excel we actually tell people don't do it. What we would say is the income statement is not too difficult to do. The balance sheet needs to be correct, and the balance sheet is complicated, and you will probably find yourself spending all your time fixing the mistakes and not actually using it and so, and then I would take it one step further. I think one of the barriers for many people is then what tool do I use? And if I'm really small, I have to become an expert in the forecasting kind of tool and some kind of a reporting tool and maybe other things, and that becomes overwhelming. So, I'm agreeing with you, but we really discourage people trying it in Excel because it just, man, you're going to find yourself in a nightmare trying to do that.

Blagoja (00:36:21) - But still, more than 95% of financial plans are created in Excel.

Adam (00:36:26) - Well and so but to that point and partially because, you know, not only is that what we're kind of familiar with but also because they're flexible and so, what you will find is that in a lot of these other tools, it's just really difficult to provide that kind of flexibility that Excel has inside of a software and that has historically been a little bit of a challenge because once you go out of the, hey, I'm in base mode and I'm just dealing with these ten basic concepts, you know, the clients will oftentimes take you through this rabbit hole of like trying to like go, okay, but we should be more granular here and how do we get with a budget here and then how does that work from like a user perspective with the software because what we also find sometimes frustrating but still a request is sometimes clients are wanting to sandbox with different scenarios or clients are wanting access to be able to change the data.

Adam (00:37:26) - So, how does that work with, I mean, knowing that obviously the primary person that you are, your end user is the person that's actually running the business. How does that work with multi users and one program? And do you have scenario availability right now.

Blagoja (00:37:44) - Oh yeah. That's hygiene stuff right. yes. You can have as many people as you want working on your own, your financial plan or your, whatever you are doing within bottlenecks. So, basically the owner of the account just gives access to whatever part of, of, of, of, of bottlenecks they want to any, any person and then that person can either be a viewer or an editor. So, if you give them an editor, editor, permission, then you can have five people at the same time working on the same financial plan or maybe two works on pitch deck, two on the financial plan. It's all real time collaboration in Excel. This is very difficult. This type of collaboration in Excel is very, very difficult. So, that's one of the big advantages of, of SaaS software not only model X, basically any software would allow you to have this kind of real-time, real-time collaboration between client and, and advisor or just within the client team, whoever, whoever want to do it.

Blagoja (00:38:39) - So. So yeah, that flexibility, that flexibility is there. I think that's a given. It has to be there. That's one of the most important value propositions. Yeah. And then and then. So, go ahead.

Tom (00:38:53) - No, I was just going to add so more about model. So, an advisor who wants to work with you. You talked. Do you want to talk a little bit about pricing and if it's on a per my client basis, if I'm the advisor or I buy the software, you want to talk a little bit about helping people understand if they want to move and learn more about it.

Blagoja (00:39:09) - Yeah. I'll start with, it's great value pricing. I don't like saying cheap, but it's actually cheap, but it's great value pricing. So, for the highest plan, meaning you have access to pitch, deck creator, business plan, financial planning and dashboards, everything the whole model is. It is, on a monthly basis, $59, monthly subscription and if you do it on an annual basis, then you get a 30% discount on that number.

Blagoja (00:39:41) - So, it's on an annual basis. The most expensive plan is $492. Actually, and within that you get five companies. You can, you can have business plans, financial plans for five companies and five users in the end, five users. If you want to add more companies, you want to add more users. Then it's just $10 per company or per user that you want to add. So, I think pricing is not an issue for anyone, when it comes to models, if you if you find it useful, then I think pricing is just negligible. Yeah, yeah.

Tom (00:40:15) - And then for someone just getting started, what kind of support training. Help me get my first one done. What is offered around that?

Blagoja (00:40:22) - Yeah. So, we have we have support, during life support during, about 12 hours out of the day. and this is chat, chat support and email support, as well, if a client needs some help, they can schedule a demo call or for a 30 minute demo with, with some of my, some of my sales teams, sometimes with me, I still we're still in early stages, so I still like to hear directly from my clients to, to, to understand what, where I can improve, where they struggling so, that I can improve the software.

Blagoja (00:40:54) - So it's, so, if you if anyone has a question, the first level of support is customer support live chat or email but any time anyone requests I want a conversation like this, a live conversation with screens or sharing screens and just going through models together, we that's the next level of support that for now everyone is getting. Where do we grow up into you know, having 20,000 clients. We probably are not able to do that but for the moment, anyone that needs help live in, live session we are able to provide provided support and more. Moreover, I just want to stress this. If you have a specific niche industry in terms of your clients, and you need a financial model, we can, we can do that for you. We can do it together because you understand that industry very well as an accountant. So, what are the KPIs? What are the KPIs that are important? We can build out a model that you can then use for all of your clients within that industry.

Blagoja (00:41:54) - And that's a level of support that for that kind of support. I would do that myself directly.

Tom (00:42:00) - Yeah, it does sound like good support. I think that idea of sort of that demo called the onboarding is people start you're going to really find valuable even as you get bigger because that's often what we hear is like, when I start with that blank page, I'm not sure what to do and we even do that internally with new people and once I've done one, all of a sudden sort of the lights start to, to go off and then you're like, okay, now I've got it from there but I wouldn't be surprised whether it's live or maybe a, hey, here's a recorded class that you go through and build your first kind of so.

Blagoja (00:42:29) - So Tom, I've created how many 32 videos for how to use how to use modeling. So, when you are in modeling there is a help center where it has 32 videos for every section, there is a five-minute video of how to use that section.

Blagoja (00:42:44) - Then there is the full demo video of 15 minutes of, of the whole of models. Then there is a demo by industries or SAS and how to create a financial model for SAS industry for restaurants for consulting for different industries and then there is a there is 100 articles again for every single section of, of, of, of business and of financial planning and reporting and you know what? People don't like to look at them. I see what I find is still when I sit down with someone, they take 15 to 30 minutes to show them around. Modeling. This is when it just clicks. It's like, oh my god. Yeah. Great. Yeah.

Tom (00:43:28) - So, we are creatures of habit, aren't we? You're like. 

Adam (00:43:32) - It's easier to just go. Yes, exactly. So, how does that work with multiple companies or departments then? Does that, does that role up or like let's say that I heard you say restaurants like, say you had five restaurants.

Adam (00:43:47) - Do you put all five restaurants in there individually and then is there some kind of consolidation feature?

Blagoja (00:43:52) - Yeah. so.

Blagoja (00:43:54) - This is the version that is going to be released in three months together with the accounting integrations, which I call multi-dimensional planning and reporting, which will have a consolidation feature. So, you define your, you define your company structure, whether that's, you know, two business units, three regions within each within each business unit or it's a restaurant company with five restaurants whatever is your organizational structure, you define that and then you do your planning based on based on that, that planning and reporting based on the structure at the moment is on a company level. On a consolidated level, you can have you have different revenue streams, for your, you can have different revenue streams, different customs. You can split them by, let's say, by, by departments or by restaurants, but a true multi-dimensional feature is coming in about three months from now and that's going to be a, that's, that's the that's the version that's the software that comes in handy for, for medium sized businesses because they are the more, more complex businesses that they require.

Blagoja (00:44:58) - This, this multi-dimensional structure that rolls up into consolidates into, into, into, into one company and then it actually so it consolidates up and then it allocates costs down when wherever, wherever required. So, full consolidation and allocation but that's coming in in the next three months at the moment is that's why I said it's startups and small businesses where they do not have a complex, complex reporting structure, with, with different departments, stores and everything.

Tom (00:45:28) - Okay.

Blagoja (00:45:29) - It is. There are three things which I, I can't wait, and they should happen in the next three months that that I just can't wait for them to happen. One is QuickBooks integration. Second is multi-dimensional planning reporting and third one, which for the US is not important because it's already in English, but it's localization and different languages for different for different countries. These are the three most important things that are coming up in the next three months.

Tom (00:45:55) - This sounds great, and it really does, is we talk to people going toward advisory, that idea of helping someone through a forecast, and then the continual maintenance of the forecast and helping them track that progress is really important.

Tom (00:46:07) - But like I said before, one of the most one of the biggest questions we get is around tools and what tool and there's a there's both an expense to it and a lot of time that people put in. When you talk about small operators, and we work with a lot of solopreneurs and this looks like it sort of checks a lot of those boxes for people and so, I would really encourage people that they can reach out. So, where can people get best information? I assume it's modelx.com is your best.

Tom (00:46:31) - Place to go.

Blagoja (00:46:32) - modelx.com that's the place. Yes.

Tom (00:46:34) - That's fantastic. Well, I hope people will move that direction and thank you for kind of this overview, and it's gotten me more excited about some of the driver-based kind of things that we do and the way we're doing it it's consistent, but also a really good sounding tool.

Blagoja (00:46:48) - Look, thanks for inviting me as well, Tom and to this, I just I just love I just love to get people to, to teach them for them to learn how to create a financial plan that is truly useful based on drivers.

Blagoja (00:47:01) - I see way too many plans with. Just plug the numbers in there. Yeah, my revenue is going to be 500,000 and my costs are going to be 300,000. It just doesn't work that just let's stop doing that and let's create something logical, something that makes sense, something that helps you actually manage your business, provide a set targets to your, to your employees. I mean, you have you know, I was giving the example of number of leads and then conversion rating to into client. That's the target for your customer team, for your sales team. Right. This is your conversion rate. Yeah. I don't want you to I there are no other targets. This is your target. It's in the financial plan and you are you are directly impacting with your, with your work, your direction impacting the financial situation of the company and you can see that link so, as you can see, I'm extremely passionate about driving based see the passion.

Tom (00:47:55) - Yes. Yeah, I totally agree.

Blagoja (00:47:57) - And it's not a very interesting subject to be passionate about. I'm passionate about other stuff as well. But now because the conversation is about driving about financial planning.

Tom (00:48:05) - Yes. Yeah.

Tom (00:48:08) - The get entrepreneur who is passionate about their business and often they're not good at that analytical part and that's where the advisor can come in and help them. You're good at your part of running the business. Let me help you run on the advisory part, and together that can come together really nicely. Yeah. Thank you so much. Really enjoyable conversation.

Blagoja (00:48:26) - Thank you very much, gentlemen.

Outro (00:48:27) - Enjoy this podcast. Visit our website summit CPA. Net to get more tips and strategy for achieving modern CPA firm success. We are here to be a resource in this ever-changing industry.