ORBA

BACKGROUND

Introduce your business and what you do there.

I’m the founder of 97 Switch. We design and market websites to help businesses compete in an ever-changing digital world.

OPPORTUNITY / CHALLENGE

What challenge were you trying to address with ORBA?

I’m not an accountant specialist and didn’t want to be. We needed a dedicated accountant.

SOLUTION

What was the scope of their involvement?

Jim Pellino (Director, ORBA) does our taxes and provides advisory services. They give me tax planners for the year to help me file correctly.

What is the team composition?

Jim is our sole point of contact. I know he’s a director of a large team, but I don’t know how many other people work on our account.

How did you come to work with ORBA?

I found them through a networking group after being unhappy with the services my previous accountant performed. I spoke to several accountants but chose Jim because he seemed very trustworthy. He offered helpful information and everything he said made sense.

How much have you invested with them?

We’ve spent around $5,000 so far. He charges us based on the projects we assign.

What is the status of this engagement?

He’s worked with us since August 2015 and the relationship is ongoing.

RESULTS & FEEDBACK

What evidence can you share that demonstrates the impact of the engagement?

Jim’s advice is very clear and has given me peace of mind regarding the accounting for my company. With his contributions, I've been able to grow each year in profit and revenue. What I find especially valuable is having someone involved that I can trust because that frees me up to run my business successfully. Jim fills that role.

How did ORBA perform from a project management standpoint?

I’m very happy with the level of communication. He reminds me quarterly to review things with him and schedule a meeting. We also talk on the phone when necessary. They leverage technology to improve efficiency, so it’s easy to upload documents to them.

What did you find most impressive about them?

ORBA is much more transparent than other accounting companies we’ve worked with in the past. I always know when and where they’re going to change things. They’ve also been able to find mistakes of previous accountants and provide solutions. Their attention to detail and critical thinking sets them apart.

Are there any areas they could improve?

I’m very satisfied with their services.

Do you have any advice for potential customers?

Give them as much information as possible so they can make the best judgments based on the full scope of the situation. Hiding information from them will make it difficult to get the results you need.

BACKGROUND

Introduce your business and what you do there.

We are a seven-person team based in Chicago focusing on web design and development, which are two hand-in-hand areas. We also provide other digital design services, and take an active role in measuring websites and improving their performance after launch. We work on between 6-12 new builds a year, and have 25-30 active support clients for whom we maintain and market the digital properties. It’s critical for our clients’ business as well as our own to take an active role in the websites we build. In terms of revenue, we have a bit over $1 million per year, from a fair mix of new projects, support and a variety of other projects. I am the CEO of the company.

OPPORTUNITY / CHALLENGE

What challenge were you trying to address with ORBA?

We have an accounting firm, as well as a bookkeeper. The firm is in charge of routine maintenance, and ensuring that expenses are coming in and are being categorized. Our accountant takes care of more high-level strategy planning and the actual filings. I am aware of what our needs are, based on what our accountant tells us, but I’m not certified in the area myself. At the time, we had the basic need of invoicing work. We started using FreshBooks and exploring its expense and time-tracking functionalities. At a certain point, when our business became more robust four or five years in, we needed to bring in a formal accountant for expert advice on how we could do our taxes. He started using FreshBooks, but that system is limited compared to QuickBooks, for example. We can’t generate as many reports around balance sheets or profits and losses, and they’re not as reliable. QuickBooks allows us to do a lot more with the data, by comparison. Our needs evolved based on the input we received from our expert consultants.

SOLUTION

What was the scope of their involvement?

We typically meet with ORBA around tax season, as well as around October, between Q3 and Q4, in order to discuss how the year is looking. We’re constantly looking at the current state of things, what our income tax looks like, based on sales projections, and plan for what’s coming down the road, in terms of hiring new people, purchasing new equipment, growing in different directions, putting more money into our 401(k), and so on. Whatever the case may be, we plan for these issues towards the end of the year and take the steps at the start of the tax season.

We didn’t want to rent any longer, after having dealt with the world of strange landlords for many years. It became too much of a chore to deal with their personality traits, for lack of a better word. We wanted to own our own place, and grow some roots. One thing ORBA helped us do was structure a new LLC, and work with a property management company. We’re web strategists, and understand how to set up digital properties, but we’re not attorneys or accountants. Setting up physical properties and LLCs is a different animal, and it’s important to have it done right. ORBA helped inform some of the decisions we were making in relation to growing our business.

We work with remote resources occasionally, but not to the extent of bigger agencies. Pretty much all our team is local, even though we do encourage taking trips.

Setting up a 401(k) was a bit more unique for us. I haven’t talked to many other agencies who did that. We also have a financial planner who talks to us about this subject, setting up life insurance for the owners, as well as the team members. This is a somewhat morbid and uninteresting matter, but it’s still important for us. Being a good partner, we want to plan for all outlined circumstances which can arise, making sure that we’re here to take care of people.

RESULTS & FEEDBACK

Could you share any evidence that would demonstrate the productivity, quality of work, or the impact of the engagement?

I don’t know how time or money savings could be measured. In order to do this, I could look back at the years when we were filing taxes on our own, and compare those with the instances when we used someone else.

Our business was at a completely different place for each one of those years, so it would be hard to assign a true value to ORBA. In year two or three of working with our accountant, our business did very well from a revenue perspective, and we ended up paying $30,000 in taxes. I don’t know if this is a lot or a little compared to other organizations, but, at the time, it was a lot of money to us. We had conversations on how we could improve the benefits we were giving the team, and maybe not spend so much on taxes. This way, our employees would get a better quality of life, and we wouldn’t need to spend so much in taxes at the beginning of the year. Our accountant recommended a couple of options, and I had a conversation with my father, who is also an accountant, and recommended we talk to Edelman Financial. We went to them, and they put a roadmap together for what we could do for our employees, and for limiting our tax liability at the end of the year. We have a nice program in place now, our employees get to contribute, and we can put some money away. We don’t have to have such an outlay of business at the beginning of the year, when there is the most variability. This period is a bit quieter, since people are getting their footings, budgets are getting renewed, so it’s not a good time for dropping a bunch of cash due to poor planning.

How did ORBA perform from a management standpoint?

I’m pretty satisfied with the communication. I don’t hold their team accountable for these issues, because accountants are not financial planners, and to place that responsibility on them would not be accurate. The biggest problem for us, as a company which has gone through a number of options, is simply doing our job without the entanglement of making recommendations which we would become accountable for. We will start to put blinders on, and not open these cans of worms. It would be nice if there was more communication around these things, but, at the same time, I can point the finger back at myself and say that I could do more research on what growing companies do in order to decrease their taxes. I certainly love being in America and paying my taxes, but I also want to minimize taxable liabilities, and utilize resources in a responsible manner. The question is how we balance these things, and who is responsible for shining the flashlight. It would be nice if there were more standardized signals for what to do with a business.

Are there any areas ORBA could improve?

Many people want to create huge, scalable, disruptive businesses, but, for those who don’t, it would be nice to have a sort of road-mark, a more formalized way of knowing what needs to be done at certain revenue sizes. This is hard to say, since everyone’s priorities are different, and it’s why we need to talk to financial planners. We need to start anticipating these things at around the $500,000 mark, and start talking to potential partners. I don’t have a problem with ORBA’s approach, but I would like more proactive suggestions.

What tips or recommendations could you share that might increase the likelihood of success with ORBA?

Try to have regular conversations about your goals, and keep the firm in-the-loop. I try to think about the website-development process. Our client companies can change completely in one year, but, fortunately, our platform is scalable, so we can evolve and add to it. Still, we have to drive the conversation, and can’t expect our accounting agency to reach out every month and ask what’s different. We have to reach out to them and keep them ahead of big changes like acquiring property, hiring new people and so on, so that they can respond with helpful advice.