How HostBooks is disrupting the automated accounting solutions space for MSMEs & SMEs

SaaS-based accounting platform, HostBooks, provides automated accounting solutions to MSMEs and SMEs to optimise and streamline their business and financial solutions. The platform was initially formed in the US in the year 2015, where Kapil Rana, the founder, and a well known CA, was able to identify a number of challenges in the market, faced by medium and small businesses in managing their accounting and financial tasks. In the year 2018, the company made its entry in the Indian market as an AI platform to streamline, automate and optimise accounting workflows.

Accounting processes, which are conventional, comprise of repetitive, manual tasks, which include audits, MIS, bookkeeping, reporting, compliance, and these can tie down an accountant or an entrepreneur. Moreover, the newly introduced tax regime and economic changes have led to complicated statutory and accounting processes. In order to make up for the gaps created by the conventional accounting methods, Hostbooks provides tools, applications, which are secured, data protection, on-the-go accessibility of data. The platform is empowering accountants, entrepreneurs, tax professionals with interesting and out of the box tools in order to simplify the compliance, accounting, taxation, financial processes for businesses of all kinds of sizes.

Within a short span of time, it has got important clients, which include Sagar Ratna, Amazon, Haldirams, The Leela Palace and Resorts, NSDL, E-filling Income Tax Department India, Flipkart, Shopify. Its USP is the strong combination of industry focussed solutions, its Cloud 360 ERP, Big Data insights, a modular approach eradicating the all-in-one constraint, AI & ML abilities, scalability for large and medium enterprises, multi-channel integration. All these make HostBooks a state-of-the-art industry-specific solution provider that, along with streamlining operations, also empower businesses to survive in their specific industries. The business model of HostBooks is based on a number of types which include Tiered Pricing, Subscription based, Customer Support and Custom Solutions.

In conversation with Adgully, Kapil Rana, Founder & Chairman, HostBooks, said, “HostBooks’ commitment to innovation, customisation, and user-friendliness positions it as a valuable tool for a wide range of businesses, from small and medium firms to larger organisations and professionals.”

What are the main products and services that HostBooks is offering?

HostBooks is a dynamic FinTech startup with a strong commitment to transforming the way businesses manage their operations. Established in 2016-17 by Kapil Rana & Biswajit Mishra, our mission is to empower businesses by providing comprehensive, automated solutions that streamline financial processes, reduce costs, and facilitate smart decision-making.

HostBooks offers a wide range of integrated products and services, including:

SME 360o ERP (for small businesses)
Cloud 360o ERP (for mid to large size businesses)
Accounting
Business Intelligence
Neo-Banking
GST compliance
TDS management
E-invoicing & E-way Bill
Payroll processing
Order management
CRM
Point-of-sale (POS) solutions
Manufacturing and Quality Control
Distribution Management
Hotels and Café’s management
Transport Management
Construction Management

HostBooks differentiates itself by providing modular functionalities that can be customized to meet specific business segment needs, replacing the one-size-fits-all model. It stands out with its exceptional Cloud 360 ERP solution, multi-channel integration, AI and ML capabilities, and the ability to provide custom solutions for complex financial issues. HostBooks’ commitment to innovation, customization, and user-friendliness positions it as a valuable tool for a wide range of businesses, from small and medium firms to larger organizations and professionals. It operates with the goal of positively impacting millions of lives through high-quality IT-enabled services and remains dedicated to enhancing accounting support standards.

What differentiates HostBooks from other similar brands in the market? What is its USP?

HostBooks offers a truly exceptional Cloud 360 ERP solution, catering to the distinctive needs of multi-segment businesses across various industries such as Retail, Distribution, FMCG, HORECA, Manufacturing, Logistics and Transportation, and Construction. Tailored specifically for mid and large enterprises, HostBooks’ USP lies in its comprehensive array of features:

Multi-Segment Product: HostBooks stands out as an industry-specific solution that understands the intricacies of diverse sectors and provides sector specific solutions like Retail 360, Distribution 360, F&B 360, Hotel 360, Manufacturing 360, Transport 360, Project 360, Hospital 360 and Construction 360. This industry-focused approach ensures that businesses can seamlessly manage their operations, addressing unique challenges and requirements.
Cloud 360 ERP: HostBooks is a fully integrated Cloud 360 ERP system, empowering businesses with the ability to manage their entire operation from a single platform. This holistic approach streamlines processes, optimizes resource utilization, and enhances decision-making by providing a unified view of various business segments.
AI & ML Powered Insights: Leveraging the power of Artificial Intelligence and Machine Learning, HostBooks provides actionable insights derived from Big Data analysis. This enables businesses to make data-driven decisions, predict trends, and optimize their strategies for enhanced growth and competitiveness.
Multi-Channel Integration: HostBooks excels at connecting various sales channels, such as brick-and-mortar stores, online marketplaces, and e-commerce platforms. This seamless integration ensures consistent data flow, real-time updates, and a unified customer experience across all touchpoints.
Scalable for Mid and Large Enterprises: Designed with scalability in mind, HostBooks is tailored to meet the needs of mid-sized and large enterprises. As businesses expand, the platform grows with them, offering the flexibility to adapt to changing demands and complexities.
Eliminating All-In-One: HostBooks deviates from the traditional all-in-one approach, recognizing that different industries have unique operational requirements. Instead of a one-size-fits-all solution, it offers modular functionalities that can be customized to cater to specific business segments, ensuring a more precise fit.
Enhanced Efficiency: By automating routine tasks and processes, HostBooks significantly improves operational efficiency. This allows businesses to focus on strategic activities and growth initiatives while minimizing manual workloads and potential errors.
Comprehensive Industry Solutions: HostBooks doesn't just offer a generic ERP – it delivers tailored solutions for each industry it serves. From inventory management in Retail to supply chain optimization in Manufacturing, businesses can leverage specialized tools for their specific operational challenges.

In conclusion, HostBooks’ USP is a powerful combination of its Cloud 360 ERP approach, industry-focused solutions across various segments, AI & ML capabilities, Big Data insights, multi-channel integration, scalability for mid and large enterprises, and a modular approach that eliminates the all-in-one constraint. This makes HostBooks a cutting-edge solution that not only streamlines operations but also empowers businesses to thrive in their respective industries.

What are the trends observed in its industry and consumer behaviour currently, especially after the pandemic?

In the fintech industry, especially in the context of consumer behaviour, several notable trends have emerged in the wake of the COVID-19 pandemic:

Increased Adoption of Digital Solutions: The pandemic accelerated the shift towards digital financial solutions. Consumers and businesses turned to online banking, digital payments, and fintech apps for convenience, safety, and contactless transactions.
Rise of Neo-Banking: Neo-banks, or digital-only banks, gained popularity as they offered user-friendly interfaces, reduced fees, and innovative features. Consumers sought out these alternatives to traditional banks for their banking needs.
Remote Work and Financial Services: With the rise of remote work, there was an increased demand for remote financial services. Fintech platforms that facilitated online payroll processing, expense management, and digital tax solutions saw increased adoption.
Digital Wallets and Contactless Payments: Consumers favoured digital wallets and contactless payments to minimize physical contact. QR code-based payments and mobile wallets like Apple Pay and Google Pay became commonplace.
Cryptocurrency and Blockchain: Interest in cryptocurrencies and blockchain technology surged. Consumers explored cryptocurrencies as investment opportunities and blockchain for secure and transparent transactions.
Personal Finance Management: The pandemic highlighted the importance of financial planning. Consumers turned to personal finance management apps to budget, save, invest, and monitor their financial health.
E-commerce and Online Shopping: E-commerce experienced unprecedented growth. Fintech solutions that integrated seamlessly with online marketplaces and offered payment gateways became essential for businesses.
Regulatory Changes: Regulatory bodies introduced new guidelines to support the fintech industry's growth and ensure consumer protection. Compliance and adherence to these regulations became critical for fintech companies.
Cybersecurity Awareness: Consumers became more vigilant about cybersecurity. They expected fintech companies to prioritize data security, prompting investments in advanced security measures.
Financial Inclusion: There was an increased focus on financial inclusion, with fintech companies working to provide underserved populations with access to financial services.
Sustainability and ESG Investing: Environmental, Social, and Governance (ESG) investing gained traction. Consumers sought investment opportunities aligned with sustainable and ethical principles.

HostBooks, as a fintech start-up, has been adaptable and responsive to these industry trends and shifts in consumer behaviour. We’ve integrated advanced security measures, expanded our digital offerings, and enhanced our user-friendly interfaces to meet the evolving needs of businesses and individuals in the post-pandemic era. Our commitment to innovation and customer-centric solutions positions us well to navigate and thrive in this dynamic landscape.

How is HostBooks helping MSMEs’ and SMEs’ to streamline their business and financial processes and solutions?

HostBooks plays a crucial role in helping Micro, Small, and Medium Enterprises (MSMEs) and Small and Medium-sized Enterprises (SMEs) streamline their business and financial processes by offering comprehensive solutions and services:

All-in-One Platform: HostBooks provides an integrated platform that covers a wide spectrum of financial and compliance needs. This eliminates the need for businesses to invest in multiple standalone software, saving them time and money.
Automation: HostBooks leverages advanced technologies, including artificial intelligence (AI) and cloud computing, to automate manual and repetitive tasks. This automation reduces the risk of errors, enhances efficiency, and allows staff to focus on more strategic aspects of their roles.
Ease of Use: HostBooks is designed with user-friendliness in mind. Its intuitive interfaces and simplified workflows make it accessible to users with varying levels of technical expertise, ensuring a smooth transition into automated financial processes.
Real-Time Insights: The platform provides real-time business insights, including cash position tracking and customizable dashboards. These features enable businesses to make informed decisions promptly and adapt to changing circumstances.
Compliance Management: HostBooks offers hassle-free compliance solutions for tasks such as tax management, GST compliance, and TDS management. This ensures that businesses remain compliant with regulatory requirements, reducing the risk of penalties.
Neo-Banking Integration: HostBooks enables banking integration, allowing users to have enhanced control over their banking activities, real-time cash positions, and simplified payments. This integration streamlines financial management.
Business Intelligence Tools: HostBooks' business intelligence tools empower users to gain a comprehensive view of their business key performance indicators (KPIs) through customizable dashboards, voice search, and data access from various sources.
Device Independence: HostBooks ensures that its modules are accessible across different devices, including computers, mobile phones, and tablets. This flexibility allows users to access their financial records and processes from anywhere.
Cost Savings: By automating tasks, reducing compliance costs, and offering competitive pricing, HostBooks helps MSMEs and SMEs save money, making it an affordable solution for businesses of all sizes.
Customer Support: HostBooks offers exceptional customer support, assisting users promptly and effectively. This support ensures that businesses can rely on HostBooks for guidance and assistance whenever they need it.

In summary, HostBooks empowers MSMEs and SMEs by simplifying their financial and compliance processes. Its all-in-one platform, automation capabilities, real-time insights, compliance management, and user-friendly design make it a valuable tool for businesses seeking efficiency, cost savings, and strategic financial management.

What is the brand vision of HostBooks? What is its marketing strategy?

HostBooks envisions becoming a leading automated business solution for every small and medium-sized business enterprise. Our vision is to empower businesses by simplifying financial and compliance management through innovative and integrated solutions. We aim to be the go-to platform that helps businesses save time and costs, ensuring they can focus on their core operations and growth.

HostBooks’ Marketing Strategy

Our marketing strategy revolves around several key principles:

Customer-Centric Approach: HostBooks places customers at the center of everything we do. We strive to understand their pain points, needs, and preferences, and tailor our solutions and marketing efforts accordingly.
Digital Presence: We have a strong digital presence, utilizing websites, social media, and email marketing to reach and engage our target audience effectively. This enables us to connect with businesses and professionals online.
Content Marketing: We create valuable and informative content, including blogs, articles, webinars, and tutorials, to educate our audience about financial and compliance management challenges and solutions. This establishes us as a thought leader in the industry.
SEO and SEM: We invest in search engine optimization (SEO) and search engine marketing (SEM) to ensure that our products and services are discoverable by businesses seeking financial and compliance solutions.
Customer Testimonials and Case Studies: Real-life success stories and testimonials from satisfied customers demonstrate the tangible benefits of using HostBooks. This builds trust and credibility among potential users.
Partnerships and Alliances: HostBooks forms strategic partnerships and alliances with industry leaders, banks, and financial institutions to expand our reach and provide added value to our users.
User Training and Support: We offer user training sessions and exceptional customer support to ensure that our customers can effectively utilize our platform. This creates a positive user experience and promotes word-of-mouth recommendations.
Innovation: HostBooks continues to innovate by staying updated with the latest industry trends and emerging technologies. This allows us to offer cutting-edge solutions that meet evolving customer needs.
Feedback Loop: We actively seek feedback from our customers and use it to improve our products and services continually. This iterative approach ensures that our offerings remain relevant and valuable.
Community Engagement: We engage with our user community through forums, webinars, and user groups to foster a sense of belonging and encourage knowledge sharing among our users.

HostBooks’ marketing strategy is built on the foundation of customer-centricity, digital outreach, educational content, and a commitment to innovation. Our goal is to not only meet but exceed the expectations of our customers, helping them streamline their financial and compliance processes effectively.

Can you share details about your pricing model?

HostBooks follows a Software-as-a-Service (SaaS) business model, which means it provides its all-in-one automated business solutions as a subscription-based service. Here are the key aspects of HostBooks’ business model:

Subscription-Based Service: HostBooks offers its comprehensive suite of business solutions, including accounting, tax, GST, payroll, invoicing, order management, CRM, and more, on a subscription basis. Customers pay a recurring fee annually, to access and use the platform.
Tiered Pricing: HostBooks offers different subscription tiers (User and features based pricing), each offering varying levels of features and capabilities. Customers choose the plan that best suits their business requirements.
Custom Solutions: Apart from the standard plans, HostBooks offer customized solutions to meet the specific needs of medium and enterprise businesses. These custom solutions address complex financial challenges and provide tailored features to meet individual business requirements.

Overall, HostBooks’ SaaS-based business model provides a cost-effective, scalable, and user-friendly solution to businesses and professionals seeking to automate their financial management processes. The recurring subscription revenue model ensures a steady income stream for the company, and the focus on customization and customer support enhances the overall customer experience and satisfaction.

How has the first half of the year 2023 been for HostBooks?

Over the past six months of the fiscal year 2023-24, HostBooks has experienced remarkable growth in both user acquisition and revenue. Notably, the users registered in the last two quarters constitute approximately 37% of the total users registered from October 2019 to August 2023. Additionally, there has been a consistent increase in monthly revenue, with a substantial figure of approximately Rs 2.5 crore in monthly revenue.

Regarding product enhancements, HostBooks has expanded its offerings to cater to the specific needs of various industries, including Manufacturing, Retail, HORECA, Transport, Construction, and E-Commerce. These tailored solutions reflect the company's commitment to providing comprehensive and industry-specific support to businesses across diverse sectors.

What are the future plans and revenue targets for the upcoming year?

In the present business landscape, accounting and compliance are shifting to the automation technology space. Based on SaaS technology, the cloud-based platform is available on the go to resolve a myriad of pain points for businesses. The platform reduces human intervention in accounting and compliance tasks, leading to increased productivity for businesses.

Additionally, with limited human dependency, the platform makes the entire process transparent, simple and scalable. While successful automation drops the operational costs of businesses by 70 per cent. Presently, HostBooks has recorded revenue of over Rs 20 crore, growing between 75% and 100% YOY.

How is HostBooks leveraging technology and AI for developing its products and overall functioning?

HostBooks leverages cutting-edge technology and artificial intelligence (AI) to develop its products and enhance overall functioning in several key ways:

Advanced Automation: HostBooks harnesses the power of AI to automate manual and repetitive tasks in financial and compliance management. This includes data entry, transaction categorization, and reconciliation, significantly reducing the risk of errors and saving valuable time.
Data Analysis and Insights: AI-driven analytics tools enable HostBooks to provide users with real-time business insights. These tools analyze financial data, identify trends, and offer actionable recommendations, empowering businesses to make informed decisions.
Predictive Analytics: HostBooks uses AI and machine learning algorithms to provide predictive analytics. This enables businesses to anticipate future trends, identify potential issues, and make proactive adjustments to their financial strategies.
Natural Language Processing (NLP): HostBooks employs NLP technology to enhance user experiences. Voice search and chatbot capabilities allow users to interact with the platform naturally, making it more intuitive and accessible.
Bank-Grade Security: HostBooks employs AI-driven security measures to safeguard sensitive financial data. This includes threat detection, anomaly identification, and encryption protocols to protect against cybersecurity threats.
Neo-Banking Integration: AI is used to streamline banking integrations, enabling real-time cash position tracking, automated bank reconciliations, and one-click payments for users. This integration enhances overall financial management.
Customizable Dashboards: AI-driven dashboards are customizable, allowing users to create views that display the specific KPIs and data they need to monitor their business effectively.
Data Extraction and Conversion: AI technology assists in extracting data from various formats and converting it into a usable digital form. This is particularly valuable for tasks like digitizing paper documents.
User Insights and Personalization: AI analyzes user behavior and preferences to offer personalized recommendations and experiences.
Continuous Improvement: HostBooks uses AI to continually improve its products. Machine learning models learn from user interactions and data, enabling the platform to evolve and adapt to changing user needs.

By incorporating AI and advanced technology, HostBooks strives to provide innovative and user-friendly solutions that streamline financial and compliance management. These technologies not only improve efficiency, but also empower businesses to make smarter decisions based on data-driven insights.

What methods are HostBooks employing to protect sensitive stored financial data and those which are handled by it?

HostBooks employs robust methods and practices to protect sensitive financial data, ensuring the utmost security for data stored and handled by its platform. Here are some of the key methods and measures HostBooks employs:

Bank-Grade Encryption: HostBooks employs state-of-the-art encryption techniques, including SSL (Secure Sockets Layer) and TLS (Transport Layer Security), to encrypt data transmitted between users and the platform. This ensures that data remains secure during transmission.
Data Encryption at Rest: Data stored on HostBooks' servers is encrypted using industry-standard encryption algorithms. This means that even if unauthorized access occurs, the data remains unreadable and inaccessible without proper decryption keys.
Regular Security Audits: HostBooks conducts regular security audits and assessments to identify vulnerabilities and potential threats. These audits help in proactively addressing security issues.
Multi-Factor Authentication (MFA): HostBooks provides MFA as an option for users. This additional layer of security requires users to provide multiple forms of identification before gaining access to their accounts.
Access Control and Permissions: Role-based access control (RBAC) ensures that only authorized personnel have access to sensitive financial data. Users are assigned specific roles and permissions, limiting their access to what is necessary for their job functions.
User Authentication: Strong user authentication mechanisms, including secure passwords and password policies, are enforced to prevent unauthorized access.
Firewall Protection: HostBooks uses firewalls to monitor and filter incoming and outgoing network traffic. This helps in identifying and blocking potential threats or malicious activities.
Intrusion Detection Systems (IDS) and Intrusion Prevention Systems (IPS): IDS and IPS are employed to monitor network traffic for suspicious behavior and automatically respond to potential threats.
Regular Software Updates and Patch Management: HostBooks keeps its software and systems up to date with the latest security patches and updates to address known vulnerabilities.
Security Training and Awareness: HostBooks invests in security training and awareness programs for its employees to ensure that security best practices are followed.
Data Backup and Recovery: HostBooks regularly backs up data and has robust disaster recovery plans in place to ensure data can be restored in the event of unforeseen incidents.
Regulatory Compliance: HostBooks adheres to industry-specific regulatory compliance standards, such as GDPR (General Data Protection Regulation).

These comprehensive security measures illustrate HostBooks’ commitment to safeguarding sensitive financial data. The platform continually evaluates and updates its security protocols to stay ahead of emerging threats and maintain the trust of its users.

Are the products of HostBooks in compliance with any tax or accounting standards? How is it ensured that changing requirements are followed?

Yes, HostBooks ensures that its products are in compliance with relevant tax and accounting standards, and it actively monitors and adapts to changing requirements. Here’s how compliance is ensured:

Regulatory Adherence: HostBooks products are designed to adhere to the tax and accounting regulations specific to the regions in which they are offered. For example, in India, HostBooks ensures compliance with GST (Goods and Services Tax) regulations and other tax laws.
Regular Updates: Tax and accounting standards can change frequently due to legislative amendments. HostBooks provides regular software updates to reflect these changes in tax laws and accounting standards. Users receive notifications and access to updated features to ensure compliance.
Collaboration with Experts: HostBooks collaborates with tax experts, accountants, and legal professionals who specialize in various jurisdictions to stay informed about regulatory changes. This collaboration helps in interpreting and implementing the latest requirements accurately.
Monitoring Regulatory Updates: HostBooks closely monitors regulatory updates, including tax rate changes, reporting requirements, and compliance deadlines. This information is incorporated into the platform promptly.
Customer Communication: HostBooks communicates regulatory changes to its users through announcements, emails, and in-platform notifications. This ensures that users are aware of and can adapt to any modifications in tax or accounting standards.
User Support and Training: HostBooks offers user support and training to help users navigate and comply with changing tax and accounting standards. This includes assistance with understanding new requirements and how to use the platform to meet them.
Compliance Tools: HostBooks provides compliance tools and features within its products to simplify the process of adhering to tax and accounting standards. These tools help users generate accurate reports and filings.
Customization: HostBooks allows for customization to accommodate specific user requirements and unique regulatory challenges. This flexibility ensures that the platform can adapt to changing compliance needs.
Third-Party Integrations: HostBooks integrate with third-party compliance and reporting tools to enhance its ability to meet evolving regulatory requirements.
Feedback Loop: HostBooks encourages user feedback regarding any compliance-related challenges they may encounter. This feedback loop helps identify areas for improvement and ensures that the platform remains aligned with users' needs.

In summary, HostBooks places a strong emphasis on compliance with tax and accounting standards and actively engages in practices to ensure its products evolve in response to changing requirements. This commitment ensures that users can rely on HostBooks to navigate complex regulatory landscapes accurately and efficiently.