presented byGregory L. LaFollette, CPA.CITP, CGMAStrategic Advisor

Disruptive Technologies Catch the Wave

Gregory L. LaFollette, CPA, CITP, CGMA

Semi-retired Vice President of product strategy – CPA2BizNow “Strategic Advisor”

Author, Speaker, Thought-leader, Accounting Technology Hall of Fame MemberPrior

• Eide Bailly, LLP – Senior Manager, Tax and Technology Consulting • LaFollette Consulting, LLP -- Consultant to the industry

• The CPA Practice Advisor -- Executive Editor• Thomson Reuters (Creative Solutions) – VP - Product Strategy • LaFollette, Jansa, Brandt & Co. , LLP -- Tax & Technology partner

• AICPA Committees• CITP Credential Committee – Chair (7 years; Member 4, Chair 3)• Journal of Accountancy – Technology Advisory Board• TECH+/Practitioners Conference -- Planning Committee (6 years)• National Accreditation Commission – ad hoc (3 years)• National Tax Education Program (AICPA/UI) -- Graduate and former Staff

Lecturer (12 years)• Top 10 Technology Initiatives -- Review Committee (5 years)• Microcomputer Advisory Services Committee (3 years)

Who We Are

Disruption & CPA’s

Significant Areas of Change

Agenda

Who we Are

About CPA2Biz

AICPA subsidiary, Formed in 2001

Markets all AICPA products and services, manages AICPA affinity programs,

manages AICPA web properties and leads key AICPA technology initiatives

AICPA Store (www.cpa2biz.com) is ranked by Internet Retailer as one of the

Top 500 e-commerce sites in the US.

Built one of the leading distribution channels to the profession through its

Trusted Business Advisor Solutions program—a portfolio of web-based

solutions, training, resources, and alliance programs transforming the CPA-

client relationship.

Headquartered in New York, NY with technology and engineering offices in

Santa Clara, CA, sales office in Dexter, MI, and service and support offices in

Durham, NC.

Overarching Principle

We are the leader in guiding the profession’s migration to the cloud through change management, business process education and product and service curation.

Templosion

“the implosion of everything into compressed time”

tem·plo·sion [tem-sploh-zhuhn] noun

It’s a TEMPLOSION

“It’s a VUCA world – Volatile, Uncertain, Complex, and Ambiguous … the answer to rapid changes and hyper-competition is a bold vision and core values; maintaining values that don’t change while constantly re-inventing the shorter term strategy.”

Tom Hood, CPA.CITP

Ex. Dir – Maryland CPA Society

“I like Tom Hood’s VUCA to define the paradox. Rapid, short-term change and long-term leadership ideas and goals simply don’t mesh well.”

Hubert Glover

Author: The Making of the Twenty-First-Century Leader

It’s a TEMPLOSION

“It’s a VUCA world – Volatile, Uncertain, Complex, and Ambiguous … the answer to rapid changes and hyper-competition is a bold vision and core values; maintaining values that don’t change while constantly re-inventing the shorter term strategy.”

Tom Hood, CPA.CITP

Ex. Dir – Maryland CPA Society

“I like Tom Hood’s VUCA term to define the paradox. Rapid, short-term change and long-term leadership ideas and goals simply don’t mesh well.”

Hubert Glover

Author: The Making of the Twenty-First-Century Leader

A Note on Predictions

“It's tough to make predictions, especially about the future.” ― Yogi Berra

Current Vantage Point

Our near term view is

always unclear.

• “Inside the Tornado”

• “Tipping Point”,

• “Crossing the Chasm”

My overlay from 1993

Disintermediation

Disintermediation

Removing the middleman -- a popular buzzword used to describe how Internet-based businesses are using cloud and mobile technologies to reach customers. These companies provide products and services cheaper and faster. These technologies are revolutionizing the way products and services are bought and sold, and disintermediation is the driving force behind this revolution.

Trends to Discuss

Some Trends to Discuss

1. Cloud Storage

2. Broadcast TV / Cable TV

3. 3D Printing

4. Peer-to-peer lending

5. Restaurants

6. Hotels / lodging

7. Cars

Cloud Storage

Dropbox™What It Is: Online document, image, and video storage

What It Does:Lets you bring your photos, docs, and videos anywhere and share them easily. 

Dropbox™How You Might Use It: • Store important documents

online for easy access.• Collaborate with others for

edits and updates.• Share private documents.• Store and view property

photos.

Dropbox

Dropbox

All Files

Some Files

Dropbox™Learn more: www.dropbox.com

Platforms: iPhone®, iPad ®,

Android™, Blackberry®, Kindle Fire®

A Note on Multi-factor Authentication and Passwords

Multi-factor authentication

Who you are (biometrics)

What you know (user ID, passwords)

What you have (dongle / phone)

To enable Dropbox two-step verification

1. Click Settings > Security tab

2. Account > Two-step verification > Enable

3. Enable two-step verification

4. For security reasons, you'll be asked to re-enter your password. Then you'll be given the choice to receive your security code by text message or to use a mobile app.

5. After enabling the feature, consider adding a second phone number as well. If you ever lose your primary phone, you'll be able to receive a backup security code to that number instead.

Password Technique

• Select and memorize an 8 character nonsense string including upper and lower case letters, numerals, and symbols.• Example: qh^64Tp%

• Select 2 “spots” within that string (example: # 3 and #7)• Example: qhX^64XTp%

• Select 2 “spots” within the name of the website or service you’re registering (example: # 1 and # 3)• Example 1: wellsfargo.com = wellsFargo• Example 2: cchgroup.com = cchgroup

• Insert the website characters into your password• Example 1: qhw^64lTp%• Example 2: qhc^64hTp%

One password that’s the SAME for you, yet different for every site

/ service you use!

Result

Password Management Tools

• Keeper• Dashlane• LastPass• oneSafe• SplashID Safe• Norton Identity Safe• Password Genie• Roboform• Ilium eWallet

Television

Say Good-bye to Cable TV

Barry Diller’s Aereo TV

Barry Diller’s Aereo TV

$8 / month for CBS, NBC, ABC, FOX, PBS>150,000 subscribers in NYC

Sold out in AtlantaDirectly to Supreme Court on April 22

• First in was all fun and games• Then it started to get serious• Graphene will take it to the next level• Already printing houses -- Contour Craftings prints

2,500 Square-Foot-Homes in 20 hours• And some airplane parts!

3D Printing

Graphene

• Graphene is amazing!• Made from a layer of carbon one-atom thick• Strongest material in the world• Completely flexible • More conductive than copper• Desalinizes sea water WHILE generating electricity!• Will eventually replace silicon

MakerBot

Replicator Mini -- $1,375 $949

XYZprinting

Davinci 1 -- $499

Forecast World wide sales > 2.2M

Projections for 3D Printing

• Significant patent expirations in mid-2014• Chinese manufacturers involved• Technology has reached “tipping point”• Compare to laser printers • HP 2 sold for $3,995 in 1985

• Now available for >$100 (overpriced ink)

• 3D printers sold for $14,000 only 5 years ago• Now available for >$400 (overpriced material @ ~$25 per pound)

• Explosive growth from here on out• How does this impact YOUR clients?

Peer Lending Technology is the easy part

• Kiva (non-profit)• > 1 million lenders• > $500,000,000 in loans• 99.01% Repayment rate

• KickStarter (friends and family)• Regulation and litigation

• Prosper (Wells Fargo execs)• >$1 billion in loan originations to date

• LendingClub (technology execs)• Loans being funded @ > $250M / month• Interest paid to investors: ~$500M to date

• Kabbage (technology & banking)• Direct ties to cloud-based accounting platforms

Crowdfunding Grows Up

• 2012’s JOBS Act, allows companies to raise up to $1 million in a 12-month period

• From “accredited investors” • Income over $200,000 (single) or $300,000 (joint) per year • or net worth over $1 million• An executive or director of the company

• Under $100,000 requires two years of financial statements, certified by the principal executive, and its most recent tax return.

• From $100,000 to $500,000 the statements must be reviewed by a CPA.

• Over $500,000 must have audited statements

What it means

• Role of banks?• Role of CPA’s as credit advisors?• Financial statements?• Benchmarking and analysis?• Personal investments?

Disruptive Technologies

Transparency

Provider

CustomerTechnology

Disruptive Technologies

GrubHub / Seamless®

What It Is: Food delivery service

What It Does:Aggregates menus of restaurants that provide delivery service to your specific location. Automates ordering and payment functions.

How You Might Use It: • Order food delivery at your

home, office, or hotel.• See each restaurants’ menu

and customer ratings.• Limits errors in ordering,

address, etc.• Centralizes credit card

payment so there’s no more fumbling at delivery time.

GrubHub / Seamless®

Learn more: www.seamless.com

Platforms: iPhone®, iPad®, Windows®, Android ™, Web app

Cost: Free

GrubHub / Seamless®

25,000 participating restaurants130,000 meals per day3% rake

DISRUPTION:

Sit-down restaurants

OPPORTUNITY:

Del-co food outletsServices for “nesters”

GrubHub / Seamless®

AirBnB®

What It Is: Short term room rental founded in 2008 as “couch surfing”

What It Does:Provides intermediary service between “hosted” apartments, rooms, B & B’s, etc. and patrons wishing to rent them.

AirBnB®

Current VC value!

How You Might Use It: • Host extra space, vacation

home, apartments, etc.• Rent space almost anywhere

in the world.• See each property’s photos

and customer ratings.• Limits errors in reservations

dates, address, etc.• Centralizes credit card

payment so there’s no more fumbling at arrival time.

AirBnB®

Learn more: www.airbnb.com

Platforms: iPhone®, iPad®, Blackberry®, Windows®, Android ™, Web app

Cost: Free

AirBnB®

AirBnB®

DISRUPTION:

Traditional hoteliersMunicipal tax collectors

OPPORTUNITY:

Micro-landlordsTravelers

Cars

So what changes?

• First – rental cars• Started with ZipCar – sold to Avis/Budget• Then GroundLink for limos• Now the taxi and limo business• Next – autonomous cars

Uber®

What It Is: Car and taxi service

What It Does:Provides intermediary service between car and taxi owners / operators and patrons wishing to utilize them.

Why Use It: • Almost-on-demand black car or

taxi service.• Cheaper than traditional black

car service.• See each car’s exact location

description and customer rating.• Limits errors in timing, address,

etc.• Centralizes credit card payment

so there’s no more fumbling at drop-off time.

Uber®

Learn more: www.uber.com

Platforms: iPhone®, iPad®, Blackberry®, Windows®, Android ™

Cost: Free

Uber®

And here comes the competition!

Uber®

DISRUPTION:Existing taxi / limo companiesMunicipal tax collectors

OPPORTUNITY:Part time drivers (Google financed)

TravelersDelivery services

LONG-TERM IMPACTNumber of cars requiredParking lotsAutonomous cars?

Enter Google

Driverless Cars

• We already have “assisted” driving• Auto parking• Lane monitoring• Adaptive cruise• Emergency braking

• Autonomous cars in our lifetime?

• BMW• Audi• GM• Ford• Mercedes Benz

• Volvo• Nissan• Ford• Chrysler• Hyundai

• Nevada, California, Florida, Michigan and Washington DC now allow licensing and operating autonomous vehicles on public roads.

• Google Ventures just make its largest investment ever -- $285M in Uber (valuing Uber at $3.75B)

• Google says its designing Its own self-driving car for use as a ‘Robo Taxi’

• Technology is the easy part• Legislation and litigation are challenges

Driverless Cars

1. Technology enables massive competition

2. Centralized regulation disappears

3. Fewer cars?

4. Fewer parking lots

5. Less congestion

6. Better safety

7. More productive time

So what changes?

8. Cost of trucking falls – logistics become cheaper

9. Fewer hotels?

10.Fewer full time jobs / more part time?

11.On demand delivery becomes standard – fewer bicycle messengers

12.Surge availability

Thank You!!!