No business can survive without book-keeping and accounting, as these help organisations record, streamline and analyse financial data for efficient operations. India is home to 63 Mn MSMEs (micro, small and medium enterprises), collectively contributing nearly 30% to the country’s GDP but lacking the deep pockets to set up the operations in-house or opt for expensive full-service solutions. Even now, many companies do billing and accounting manually or rely on traditional spreadsheets.  

Aware of the techno-financial requirements of new-age small businesses, many SaaS (Software as a Service) startups in India have ventured into the accounting space with a wide range of affordable and scalable solutions based on pay-as-you-grow subscription models. However, meticulous tracking and calculation of expenses and earnings tend to get more complex when small businesses expand their customer pools, explore cash flow management through business forecasting or seek improved workforce management for cost optimisation.

Gurugram-based Unesync is a new kid in the accounting space. But unlike pure-play SaaS players in this segment, the startup has adopted a holistic approach and put together a wide range of services to empower small and midsize enterprises (SMEs) in more ways than one. 

Set up by serial entrepreneurs and childhood friends Rohan Chopra and Ujjwal Agarwal, the two-month-old startup provides end-to-end accounting services and inventory and team management tools to streamline processes. Plus, it helps SMEs communicate with external stakeholders such as vendors and customers instead of subscribing to a full-fledged (and expensive) CRM system.

Ever since starting its operations in October 2023, the startup has onboarded partners like Delhi-based café Chai Lelo, edtech platform Victory Point and advertising agency Span Advertising, among others. Furthermore, it aims to onboard 1K+ B2B customers by the end of FY24.

The web-based platform is also developing Unesync Capital, a tool to predict when companies may require credit, and provides them easy access to small-ticket business loans. Unesync uses data analytics and AI to enable these predictive analyses.

“Rather than businesses realising [at the eleventh hour] that they need credit for orders or projects, our platform helps them understand these requirements at the invoicing/purchase stage,” explained Chopra.

The credit market typically operates in a flow, from inquiry to approval, and raising back-to-back loans is not easy. However, the initial amount requested by a business often fails to suffice, as cost projections are not always reliable. Unesync aims to assist SMEs with more accurate calculations so they do not fall short or borrow more than needed.

To ensure easy access to small business loans, the startup has partnered with credit aggregators like Recur Club and Inca Fintech. The focus is on the micro-lending segment to help businesses raise capital for day-to-day operations.

Unesync Capital is still a nascent offering, available to a few B2B customers. Chopra says the service is still in the testing phase. Based on customer feedback, the platform will tie up with more fintech partners to open the feature to a bigger user base. The startup aims to onboard 1,000+ businesses by the end of FY24 and will also look for seed funding in 2024.

How Unesync Layers Tailored Solutions For Critical Tasks, Plans To Thrive On Scalability 

Before starting Unesync, the founders set up Decimal Space in 2019. While running the software development firm, the duo acquired diverse businesses from the fintech sector and observed a crucial gap in terms of accounting solutions in the market. 

According to the founders, most SMEs are compelled to outsource payment processing, tax compliance or credit line management in the absence of trained in-house staff. A few also purchase software programmes for digital accounting. However, aligning these critical tasks at the end of a financial year could be challenging for the uninitiated. 

Recognising the necessity for a unified approach, the duo started Unesync to offer one-stop accounting solutions for SMEs with a yearly turnover of INR 5 Cr – INR 25 Cr. The revenue bracket has been strategically chosen to drive growth as Indian businesses with an annual turnover of INR 5 Cr or more must do e-invoicing for B2B transactions under the GST regime. 

Queried about the core tech used for accounting, Chopra likens Unesync to Tally, which helps users generate E-Way bills and e-invoices (payable and receivable) without any hassle. The startup, too, has designed a data engine to gather information from various financial sources such as the GST E-Invoice portal, the GST E-WayBill portal and bank statements from account aggregators to streamline and automate a number of compliance procedures typically handled by chartered accountants.

For instance, a CA performs various tasks at the invoice level, including verifying GST returns and checking if suppliers have uploaded GST information correctly for credit processing. As the platform has enabled GST data integration, it can gather vendor data and retrieve their returns directly from the portal without requiring manual intervention.

The platform can track payments dues and manage payments. Besides, it provides various value-added solutions, including inventory management, team management and its proprietary credit prediction tool.

 The startup’s ability to scale and conform to all new policies will also help it serve businesses of all sizes – a key differentiator that sets it apart from the rest. Chopra explained it with a simple use case.

“A business, starting with modest revenues, may opt for a product like Khatabook, which primarily caters to companies with an annual turnover of less than INR 5 Cr. It makes ample sense, given their limited requirements. As they progress, they may move up to a solution like myBillBook that focusses on SMEs [those earning INR 5 Cr and above a year, as per government definition]. But when these businesses reach a certain level, these products may be inadequate to address their requirements,” he pointed out.

Although Unesync is currently targeting the same clients as myBillBook, it will soon introduce enterprise-level solutions to serve the entire spectrum of businesses and gain a cutting edge.

Like most SaaS platforms, Unesync earns revenue through a pay-as-you-grow business model, spanning monthly, quarterly and yearly subscriptions. For basic accounting solutions like e-invoicing, the monthly fee starts at INR 250 and goes up to INR 900 if customers want to add additional features such as inventory and workflow management.

The Way Ahead For Unesync 

Initially, enterprise tech incumbents paid scant attention to SaaS disruptors, predicting that old-timers (businesses minus digital-age tech exposure) would not find implementing brand-new technology easy. However, small, cash-strapped entities learnt to ‘adapt’ quickly after tasting the cost-efficient, consumption-based success sauce whipped up by SaaS players.

According to industry experts, the accounting and finance landscape is becoming digital worldwide, and the Asia-Pacific will witness the highest growth in this space. SaaS accounting software is driving this digital transformation to a large extent, given the emergence of small businesses and increasing investments by SMEs in the SaaS and cloud market. Globally, the market for online accounting software is estimated to reach $38 Bn by 2030, expanding at a CAGR of 8.1%.     

Small businesses in India are also leaning towards digital tech and getting ‘SaaSy’ in a post-Covid world. An IDC report predicts that 30% of small and medium enterprises will shift one-third of their core workload to the cloud by 2024. This will broaden the integration of SaaS-based digital accounting (including data analytics and reporting) and lead to value-added offerings such as data-driven advisory services, business valuation, budgeting, financing and more.

However, scripting a success story in this space may be difficult due to an intensely competitive landscape. Think of the homegrown and bootstrapped unicorn Zoho, which claims India may soon become their second-largest market (after the US), powered by SMB and enterprise growth. Essentially, the market is rapidly getting crowded as desi and global firms like Zoho, FreshBooks or Vyapar have made successful inroads.    

Chopra is not unduly worried. He insists that the market is wide open and the competition is healthy as more businesses adopt billing and accounting software. Unesync also recognises untapped potential as companies are willing to experiment with new products and services that correspond with their fast-changing requirements.

Aware of this evolving market, the founder has tweaked the startup’s promotional strategy and did not go for a marketing blitzkrieg. “SaaS-based offerings in our niche [accounting] is not a novel concept. End users are well versed in this model and have adopted it over the past decade, allowing us the freedom to do away with excessive marketing,” he said.  

Instead, Unesync has gone ahead with word-of-mouth promotion and involved chartered accountants working with small businesses. The platform encourages CAs to sign up for free trials. After that, its customer support team guides them and helps them understand how the platform works. 

 Chopra says this approach has yielded positive results, and Unesync aims to onboard 1 Lakh customers in the next two years.

Amid the growing demand for digitalised business processes, SaaS-based accounting solutions are gaining traction among Indian SMEs. Moreover, SaaS providers can attract a diversified customer base with increased verticalisation or never-before silo-breaking. While established players cater to mainstream requirements, newcomers like Unesync seek to stand out with their unique value proposition – a combination of accounting, process management, and financing capabilities.

Of course, opportunities to innovate in SaaS are far from over. But savvy businesses that can develop more unified solutions to meet broader needs may have the potential to corner success. It will also benefit the SaaS industry, which can seize the future by evolving in sync with emerging trends.