Latest / Unofficial QuickBooks Accountants Podcast / 17% Layoffs, 83% Reorg

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17% Layoffs, 83% Reorg · Unofficial QuickBooks Accountants Podcast

• There may be errors in spelling, grammar, and accuracy in this machine-generated transcript. Alicia Katz Pollock: In this week's episode of the unofficial QuickBooks accountants podcast, we're going to talk about the recent announcement that Intuit has laid off 17% of its staff this May. I have with me Dan DeLong of School of Bookkeeping and Matthew Scott Fulton from Parkway Business Solutions. And we actually all three of us came on because we were like, oh, man, how are we going to [00:00:30] talk about this? So thanks for coming, guys, and helping me with this one. Dan DeLong: Yeah, I'm glad to be here. Matthew "Spot" Fulton: Dan, is it like reliving a nightmare again, you know from from when you. Dan DeLong: No, no it's I mean it does I mean we'll we'll we'll get into this as far as like how frequently this this sort of thing happens. But um yeah, it I feel for the people. That's, that's just it. Alicia Katz Pollock: Okay. So so let's back up a second. And [00:01:00] Dan, I'm going to turn the floor over to you in just a minute. So basically the what happened is that at the end of May 2026, about 3000 Intuit employees got a letter from Sassen announcing their latest round of layoffs. Now, the the round of layoffs before this one was two years ago. Before that, I think it was four years ago. So layoffs in Silicon Valley are not a shock. And one of the things that I have [00:01:30] heard is like, everybody's instinctive reaction was, oh, they're just being replaced with AI. And that's not what's happening here. Definitely not what the case is, that we're actually very clear to say that that's not what's happening. So, you know, Dan, you've been a long time. You were a into an employee back in the day. You've been through rounds of layoffs with them. So what's your perspective? Dan DeLong: Yeah. I mean, this is, um, unfortunately, [00:02:00] it's, it's part of the culture, right. Um, into, into its fiscal year starts on August 1st. Right? So the fourth quarter is when decisions like this get made and the third quarter, which was the results of what, what occurred, um, and why, why this happened is typically a reflection of how well or how poorly TurboTax did, because that's the third quarter. That includes [00:02:30] the tax filing season, right? So when things occur, right, like better than expected or less than desirable than the fourth quarter comes. Okay. Well, we need to make some adjustments. And payroll is a large part of their bottom line. So they have to make these things and it comes, it comes, it doesn't it doesn't come as a surprise, right? Like [00:03:00] it happened to me twice, you know, and the one time was in 2008 when they laid off a bunch of folks in the point of sale and the QuickBooks enterprise and those types of things. And I was on vacation. I was, I was actually on PTO at the, at, on the date of the announcement. Um, and we were going to Mexico and there is this place in, um, in Arizona where I got, I got the phone call, right? I'm [00:03:30] like, this guy never calls me who, why? And he told me what was happening. Dan DeLong: And I looked up and we were in y Arizona WHY because there is this big fork in the road. There's this big fork in the road where you turn left to go to Mexico and go turn right to go to California. Right. And so it was like so fitting that like, oh, why, Why is this happening? And here I am in why, uh, Arizona [00:04:00] and, you know, how do you deal with all of that? You know, while you're on vacation, there's so many. There's more questions than there are answers. Uh, and we just were like, well, let's just enjoy our, our vacation. And we will, we will come back to that. And I didn't lose my job at that point. I just lost that job and was able to find another role and into it is a very, you know, eco friendly company because they recycle employees, [00:04:30] right. And that that's, that's the things that you don't see on these headlines, right? Because as they're, they let go 17% of their workforce. Um, that workforce has grown since the last time that they, they had a huge layoff. Right? So that's something to keep in mind that, and that doesn't get a headline of, oh, Intuit hired more people than they let go or anything like that. Dan DeLong: Right. So that's, [00:05:00] that's something that they have as part of that culture is that when reorganizations like this occur, it is because they are restructuring something, right? And in this case, they were combining TurboTax and Credit Karma. There was some a lot of redundancies in middle management and those types of things. And that is the vast majority of the positions that were affected. Is that if you're under the same business unit, why are we having [00:05:30] two people report to this person and two people report to that person? Let's have at least four people report to one person. And that's how they they kind of handle a lot of these things. But in that restructuring, they are going to open up other positions. And by releasing the people that they're letting go. Those people have the opportunity to apply for those open, open positions. And that's what happened to me in 2008, is that they had a whole bunch of open [00:06:00] positions. I applied for them, never had to turn in my badge or, you know, deal with all of the, you know, exit paperwork, uh, in that, in that regard. Alicia Katz Pollock: That's interesting is that Glenn doesn't necessarily mean goodbye. Right? Yeah. So, so let's, um, get a little bit more specific about what they've, they've said about it. And so basically they said that it's not performance related, that a lot of it, some of it was leadership [00:06:30] and management that they have a lot of management layer. So a lot of VP's and directors and principal level employees and management roles that they are consolidating. Some of it is reductions to senior software engineers and product managers. A lot of it was due to redundant operations that because of their investments in purchasing Credit Karma and MailChimp, that they had some overlapping, [00:07:00] overlapping staff. Mailchimp, they've revised their estimates on MailChimp. Apparently, it's not doing as well as they as they want it to. So they're reducing some of their investments in MailChimp. They closed offices in Reno, Nevada, and Woodland Hills, California. Now, do you guys know if the offices in in Reno and Woodland Hills are specific to a purpose and task, or is it more of a location administration? Matthew "Spot" Fulton: Woodland Hills is pretty close to where [00:07:30] I live, and that's always been the merchant processing area is what I've seen. Um, pretty much everything having to do with merchant processing goes out of that office space. Dan DeLong: Yeah. They, um, when they acquired, when they acquired, uh, IMS, which was their payment processor the company that they were based in Calabasas and would opened up an office in Woodland Hills. So the center of those operations were in that area. Um, and [00:08:00] then Reno is, uh, payroll, right? So a lot of the assisted payroll, which of course, you know, you can't buy assisted payroll anymore for desktop and the risk and, um, underwriting, you know, a lot of those things were, were based out of Reno, Nevada, uh, with their other announcements of, uh, you know, acquiring the company. Uh, I, I imagine that played into this, uh, this announcement as well. I am [00:08:30] under no, um, I can neither confirm nor deny or do I know. Right for, for a fact. Right. But I'm just looking at the. Alicia Katz Pollock: I have a question that I have not seen anywhere in my research. But you just pinged on something. How much of this was desktop reduction? Dan DeLong: Oh, I don't I don't think. Uh, I don't think that had anything to do with, uh, with a reduction in, in desktop, because I think of all of the development and those types of things [00:09:00] is, uh, is, is elsewhere, uh, in, in sites. Matthew "Spot" Fulton: Yeah. Everything I've seen has been focused on more of the online environments that they have, like you mentioned, the credit karma, the male chimps. Um, MailChimp is one of the ones that seemed like they really squeezed down a bit. And as you said, it was the double redundancy between Credit Karma and TurboTax. So desktop, I think they've been doing a pretty good job of, um, thinning that out as much as they can. Um, [00:09:30] as they increase the, the pricing to boil people over to online. Alicia Katz Pollock: Mm. Okay. And I also, yeah, that was the last episode was boiling frogs. Um, the, The. I also heard that they're opening up a new. I don't know if it's a data center or support center or or programing and engineering, but in India, they they're opening up a new building, a new, a new compound in India as well. Dan DeLong: Yeah. So I saw that [00:10:00] as well. So, um, that, that, that plays an interesting, you know, I'm sure that's going to feed into the, the conversations for the, the, the shakers of the fist. They're like, ah, they're stealing our jobs, you know, and all that, that stuff like that. But you know, that is where that's the source. You know, for a lot of development talent. Matthew "Spot" Fulton: They've, they've had a pretty strong presence in India for quite some time. Like when [00:10:30] I went out in 2020, it was an option different part of India, but it was an option to go down and visit them. So they've had a pretty good sized crew working out there for a while. Alicia Katz Pollock: Okay. Yeah. And you know, most of the developers that I have the privilege of working with are in India. So, you know, I don't know if that means that they're, they're shifting everybody to one location or if they're just that's where a lot of the development is. Matthew "Spot" Fulton: But, you know, that's the other part of this is, um, this, the total layoff [00:11:00] was global layoff, right? So it's not all just directly us based. I don't believe we have the numbers of what's from where. But that's another aspect we kind of need to keep in mind. It's not just 17,000 directly here in the United States. It's overall headcount, um, that the reduction is a part of. Dan DeLong: And in my, in my tenure there, the 18 years or so that I did work there, the headcount was consistent the whole time that I was there. It was like it was 88,000 [00:11:30] employees for the from 2000 to to 2018. But, you know, they this was a yearly either either a yearly question, but okay, who is it this year? Or do we do we get spared? You know, some kind of a large announcement like this? Or is it my turn, you know, or those types of things? So that's what I that's the mindset that I always had going through it is like, you know, yes, these layoffs occur, but they don't affect the [00:12:00] total number of employees is just who. And, and I think the biggest challenge is, you know, seeing it from the outside and like, would I run my company this way? Um, you know, because a lot of people are like, well, why aren't they just going to you and say, hey, we want you to do this instead. That is part of that culture, right? Of how, you know, Intuit hires for excellence or hires for amazing or whatever [00:12:30] it is, whatever adjective they're going to be putting for the hiring process. And they have a really good interview Process, right where, you know, it, it it's it's I think it's much harder to. Say, you know, you, Matthew, are going to do well in this role, but if you actually apply for it and actually demonstrate during the interview process that you would be good in this role, then they will hire put the right people in [00:13:00] the right place. You know, when it comes to that reorganization, reorganization, or restructuring. Matthew "Spot" Fulton: That ties into a lot of the people all three of us have known over the years. Have you ever noticed that they tend to change roles or people working on certain projects change from project to project on a pretty consistent basis. You know, whether it's a six month, a 12 month, something of that nature, there's there's definitely consistently changes happening. And I think that is exactly what you're talking about, Dan. It's the opportunity to fit [00:13:30] people into different environments, see where they shine, find that excellence and then, you know, promote the ones that really are excelling up higher. And, you know, hopefully they just don't get that SVP or VP or middle position title that later on transitions them to a new company and ready for excellence there. So. Dan DeLong: Right. Alicia Katz Pollock: Do you sell you sell yourself into being into redundancy. Matthew "Spot" Fulton: Exactly. We so [00:14:00] think now. Now think about some of the top level named people that we've known who've exited the company and then moved on to other companies and have succeeded. There's absolutely life after into it as well. And, you know, I think it's fair to kind of talk about the exit package, um, that they offer. And, you know, Dan, I'd love to hear kind of your feel of it as much as you're allowed to or feel like sharing. [00:14:30] How was the exit package for you? And then I can kind of read some of the, what I see from this one. Dan DeLong: This is the, the, the, the notes that you put in here about what was part of the communication. Uh, that is their standard. Uh, well, actually the base wasn't the standard usually it's, uh, you know, an a, a a, a base, uh, weekly, you know, they, they, they assign a number of weeks, uh, of the, of your pay as part [00:15:00] of the base structuring. And then based on your tenure with the company, then you get an additional addendum. Um, when it, when it happened to me after 18 years, I had maxed out the, the option. They were like, uh, we can't give you more than this. We're gonna. Matthew "Spot" Fulton: Pay you for another two years. Matthew "Spot" Fulton: Anyways. Dan DeLong: So, so. Dan DeLong: You know, when that happened, I was like, yay! Uh, you know, I was, I was, I would [00:15:30] have volunteered at that point, you know, to be, to be part of the, the restructuring. Um, and, uh, and when they made the, made that announcement, I was like, this is it, this is, this is when it's happening. Um, and there's like a couple who are trying to get pregnant, uh, behind me sobbing. Right. And I'm like, I can't be, you know, rejoicing, you know, in this, in this process. And, uh, one thing, one thing that just occurred to me [00:16:00] is that even though it's 17% of the workforce, it affects 100% of the employees, right? It's, um, when I left, I remember distinctly the person sitting next to me was like, why are you, you know, why? Why were you impacted? I just started here. You know, why, why are they letting you go when you're this caliber of person and the type of thing and full circle. She was impacted [00:16:30] this time, right? Matthew "Spot" Fulton: Oh, wow. Dan DeLong: So so, um. Alicia Katz Pollock: And that was something that my, one of the people I had into it who still had into it was, was telling me is that they couldn't really figure out any rhyme or reason. The, the employees who are, are left are having to rearrange and restructure and figure out how to do what that person was doing. But she said that there, there wasn't anything that they could pin on like, oh, that's why that person's going. And that's why that person's going. It's just a big [00:17:00] shrug. Dan DeLong: Um, yeah, yeah, it is, it is almost random. Um, it's kind of like the Thanos snap, right? It's. Alicia Katz Pollock: Right, right. So, so you mentioned the compensation. I want to go into the details and let people know that that if when you were laid off, you're actually getting a pretty good compensation package. They're taking care of the people who they're letting go. It's not just dropping them on their head. Um, in the, for us employees, [00:17:30] they're getting 16 weeks of base pay. So for four paid months plus two additional weeks of pay for every year, they worked at Intuit. So, you know, if you were 18 years den, then it would be an extra 36 weeks. So there's going to be some people who are coming out of this with, you know, a whole year to figure out what's next for them. Um, employees are all remaining on payroll through a transition period through the end of July. They're still going to get their July, um, investing [00:18:00] for people who have stock options. If they were eligible for bonuses, they're still going to get their bonuses. Um, and if they're outside the US, they, um, the, the severance packages depend on the country's different laws and policies. Um, but they're getting six months of health care. They're getting free mental health support, um, during the transition and up to 60 days after leaving, they're getting career support resume help, interview, coaching, [00:18:30] recruiting, recruiting and job placement assistance. Um, if they're, um, from overseas, they're getting um, immigration support with extended transition periods for visa holders and, um, access to immigration experts as part of their package. So they're really making sure that they're not just dropping people on their heads. Dan DeLong: Yeah, yeah. They, they do take care of the people that they let go. I mean, I, I had similar, you know, career counseling and, and those types of things [00:19:00] when, when I, I was let go. And that was a really great opportunity for me to really evaluate, do I want this process? Do I want to update my resume and be an employee, or do I want to go out on my own? And we obviously know where that went? Matthew "Spot" Fulton: Yep. Matthew "Spot" Fulton: You know, I've had a friend for a very long time. Her name is Michelle. Um, I did staffing before I actually started at my own accounting firm for about, uh, focused around accountants. [00:19:30] And she came to me as a, a newbie, just, she was working in a bank and she wanted to get into accounting and she ended up getting her place to enter into a job. And she and I have maintained this long relationship now for like 15 years throughout her career, she always kind of jumped from one company to the next to the next and the next. And I was always telling her at the time, like, you know, what are you doing? You got to be careful. If you keep changing companies too frequently, [00:20:00] it's not going to look good. Because I came from the, the, the mindset that longevity on the job, you know, it was it was eight years with one company, six years with another company, now ten years type thing. And I look at this relationship and what she's been able to accomplish, and her transitioning from company to company throughout time has actually improved her knowledge, her wisdom, and increased her standard income capabilities as well. So sometimes, you know, [00:20:30] these transitions lead to much more, I don't want to say profitable, but they lead to better roads for sure. Like you were. Matthew "Spot" Fulton: Saying. Dan DeLong: Well, yeah, I mean, uh, there's only so much you can do with, uh, the annual merit increase, right? You know. Matthew "Spot" Fulton: Yeah. Dan DeLong: You're going to go through this, um, you know, review process. And then you have to essentially make a case for why you deserve a raise or they have to justify, you know, the why they did or they didn't, you know, this year. Um, [00:21:00] and I think that's, that's where, you know, employment is evolving from the 45 year plan where I'm going to work for one company and maybe retire with a pension to I'm going to give myself a raise by having a period of time with this company and then move over, take those skills and move over to another company that will, you know, is, is hiring for the type of role that that I can do where I don't have to necessarily [00:21:30] prove myself to my, my coach or my manager, you know, to get a small token, you know, merit increase. Matthew "Spot" Fulton: Yeah. Alicia Katz Pollock: And that's one thing that's really just shifted in the nature of business over the years, like between the boomer generation and generation Z, is that the boomer generation was about like, hey, I'm going to work hard in early career and pay my dues and I'll get the rewards later on. And you and you, the loyalty and sticking with one thing and becoming an expert in [00:22:00] one thing was what you did. But our world has become so much more diverse. Generation Z now wants, needs. The the instant gratification of knowing what they're doing is meaningful now. And that and being able to be, um, have a broader skill set, you know, our whole world has changed. Whereas we used to have isolated silos of of task. And now being multifunctional just isn't for printers [00:22:30] anymore. It's for employees that you can that being having your skills overlap. When you get good at one thing, then that enhances your ability to do something completely different. And generation Z sees that. And so, you know, being laid off is no longer a stigma. Like you said, it's like it's what Silicon Valley does. And so when you're laid off, it doesn't, especially in this case where they're saying it's not performance based, [00:23:00] then they get to, to go into their next positions and choose what they want to do. Matthew "Spot" Fulton: You just need to think of this like a paper jam and you'll be just fine. Alicia Katz Pollock: Yeah, exactly. Exactly. Dan DeLong: I can't see the network now. Alicia Katz Pollock: I did this open up the letter that Suzanne sent to the employees. And I think it's really telling about how they approached. You know, I kind of summarized the the approach in the beginning of [00:23:30] this episode, but I think going into that a little bit deeper is really valuable. That specifically what they said is the first purpose of choosing who they were laying off was reducing layers of management, where they were discovering that the organizational layers were slowing the flow of information and hampering the ability to move with speed. So basically, people were bottlenecking by like, you know, maybe the approvals process. And so they're empowering the teams that are [00:24:00] closer to the customer in order to make their own decisions without having to send it up the chain so that they're more quote unquote, agile and accountable. So that was the, that was one of them. And I find that interesting. Taking the decision making down, down a level to the people who are interacting instead of having to send everything up the chain. Dan DeLong: Yeah. I mean, I mean, my, my, in my case, I was, I was kind of, um, typecasted, uh, in, [00:24:30] in a frontline, uh, capacity. I mean, not for me not trying to, you know, do other things, but because I did a great job, you know, talking to customers. Matthew "Spot" Fulton: Uh, we appreciated it, trust me. Matthew "Spot" Fulton: And we missed it. Dan DeLong: They, um, you know, they, they would give me maybe temporary, you know, roles doing beta testing or QA testing or things like that. And I would bring that back to my, my customer facing role, [00:25:00] which, you know, I was one of the few people that could actually approve my own data service escalations. Right. So I didn't have to, you know, talk to tier two and then have them talk to tier three and then talk to, you know, Supportability or whatever to say, okay, you can, you can send this file in, which is who's it really bothering? It's the customer at that point, because, you know, they're sitting there waiting for me to talk to somebody. I could actually approve my own. And then, you [00:25:30] know, it would just be more streamlined of a process. You know, either I could bring the knowledge to the, to the conversation or I could, you know, skip the line, so to speak. Right. And make that happen. Alicia Katz Pollock: Which is why I always liked when I got you on the phone, because we could get work done. Matthew "Spot" Fulton: Um, this, this kind of makes me question. I'm sure there's a lot of people that are listening to this that are thinking I'm having this challenge or that challenge within the software. [00:26:00] And now I'm hearing that you're laying people off. Is that going to mean we're it's going to we're not going to see things getting fixed longer, you know, is it going to take longer or not? Like, what's that going to look like as well if they're reducing headcount? Alicia Katz Pollock: So funny you should say that, because the next paragraph in what he was saying is that they want to focus the roles on high impact work, quote unquote, that they're reducing the need for coordination, heavy roles to manage the complexity, and focusing [00:26:30] their collective energy on mission critical work that directly impacts our customers prosperity, which to me sounds like programing and support. Matthew "Spot" Fulton: I mean, I hope so. Um. Dan DeLong: When we can hope, right? Matthew "Spot" Fulton: Yeah. Who's their customer? Matthew "Spot" Fulton: The the shareholder or us? Alicia Katz Pollock: Well, I actually heard um, some somebody um, passed me on a quote from one of their meetings where they said that um they're rethinking [00:27:00] the ProAdvisor as customers instead of the marketing channel the way it was ten years ago that they focused on ProAdvisor because they knew one ProAdvisor would bring them 20 clients. But now they're realizing that we are their customer because ProAdvisor right now are looking at alternatives. And if they don't actually treat us like we have value, then we're gone. And so I, I, I read into this particular paragraph that it's not about the admin in [00:27:30] their opinions. It's about what is it that we need and making us happy. Matthew "Spot" Fulton: Yeah. Alicia Katz Pollock: So I'd like to think that. Dan DeLong: When I was there, um, there was a book written by the, the company or the Zappos. Um, I can't remember the, the title of it is like defining happy or something, you know, creating happiness or something like that. And one of the tenets of, of that book, which intuit, you know, um, leadership bought into and was like making it assigned [00:28:00] reading to, to anybody who could, um, you know, turn a page, um, that they, uh, one of the tenets of that was, you know, don't outsource your core competencies, right? Whatever it is of your business, right? Like in Zappos case, you know, customer service is a core competency of that business, right? So you wouldn't want, you know, an outsourcer or somebody, another company would not [00:28:30] treat your customers the way that you would want to treat your customers. Right? So they have different metrics and, you know, things that they measure against. So, but at that point, at that point in time, I looked around, I was like, Intuit is outsourcing everything. Like even the shipping, right? Like shipping product to a customer was being done by somebody else. And so, you know, [00:29:00] those, those things held true that, you know, those companies are going to measure up to different things, right? Um, you know, there was this whole series or a season of time where they outsourced a lot of their customer support, right. Dan DeLong: I mean, you can only, you only need to pick up the phone to know that, that that's what was happening. And, you know, I went to some of those sites and, you know, at [00:29:30] one point in the day when they met their quota, you know, they would ring a bell and everybody would clap. Right. Like, so that would be because that's what they were being measured against the total number of calls. Right. So not the call resolution, not the, you know, the customer satisfaction of that, that it was just give me the this is how we get paid. We get paid for the number of calls that we get. And they were to their credit, they would all, you know, they would always [00:30:00] try to find that sweet spot. Working with an outside company to get the, the right size fit of quality versus quantity. And, you know, but in the grand scheme of things, outsourcing those things really just adds another level of, of, of complexity to make that actually happen. So bringing this back to where we were actually talking about, um, you know, we [00:30:30] can hope that they are going to those competencies that they are trying to solve for are where we're going to feel it. Matthew "Spot" Fulton: Mhm. Alicia Katz Pollock: Okay. The next part of the letter in the rationale for the layoffs was bringing our teams closer together to accelerate impact that they're co-locating the teams within strategic hubs for deeper collaboration and impact. And so that was the the rationale [00:31:00] for winding down Reno and Woodland Hills and reducing the presence in other locations. Now, I know a lot of people are working from home. I don't know if this means they're trying to get people back, back on location again, but I guess they're finding that, you know, we don't need offices so much anymore that either they're trying to bring people back into Mountain View. And, you know, we talked about the new center in India, or maybe they're leaning in on work from home. Dan DeLong: Yeah, [00:31:30] I don't know. Um, you know, this this seems to be I don't know if this is a fall out from, from Covid, right? Where, you know, everybody was required to not come into the office. Right. And then, you know, they, you know, they realized, hey, we could do a lot of this stuff without the burdensome problems of commuting. But then there's the flip side of that of like the community and the [00:32:00] culture and, uh, the expense of renting a building to have an office building that's empty, right? I mean, that is, uh, that's a that's a challenge. Uh, so then this, you know, evolution of, okay, well, you come in two days and you get to choose and then, well, now it's three days Monday through Wednesday. Now we're going to assign those. So, you know, I guess this is, you know, just part of that evolution [00:32:30] of the, the, the ramifications of, of that decision. Uh, when I was there before Covid, um, you know, they were trying different things with work from home. And one of the, one of the big restructurings was, okay, 50% of our call center folks are, are working from home. Uh, we need to be able to, you know, get information to you faster than you working at home. [00:33:00] All right. So now you don't have to work from home, but you. I mean, if you're working, you're working from the office, um, you know, and you don't have to, you don't have to work here, but, um, if you want to work from home, it's not here. Alicia Katz Pollock: The next point that, uh, Suzanne wrote in the letter was reducing overlap between TurboTax and Credit Karma. Um, now that TurboTax and Credit Karma's [00:33:30] integration is complete, they're eliminating the overlapping and redundant roles, um, to streamline those teams. So I didn't that's making me wonder that it is like Credit karma still a thing or is it now like, are they still treating Credit Karma and TurboTax as two separate legs of the table? Or is that really now one combined team? Matthew "Spot" Fulton: Yeah, this is. Dan DeLong: This is all part of the, the restructuring um, [00:34:00] and reorganization. You know, when there is an acquisition like this, you know, they may they were constantly trying to find the right place. I mean, we're talking about also, you know, ProAdvisor, right. Proadvisor being customers, right. Um, there there wasn't a ProAdvisor department or sometimes there was a ProAdvisor department, you know, because they can't silo [00:34:30] a customer that spans across all of their potentially all of their products and services when they're trying to structure it in products and services, you know, like they could use payroll, they could use tax, they could use QuickBooks, they could use Losat. Right. Like all of these things could be a, a, a particular customer. Um, how do you structure your company so that you have the business [00:35:00] units in the right place. Here we are with TurboTax and Credit Karma, which are more of personal finance. And so that just makes sense that they should be under that umbrella. Alicia Katz Pollock: Okay, now that makes sense. All right. And then his last point was reallocating resources to our primary growth engines. We're optimizing the business and reducing investments in certain areas, including MailChimp, and streamlining [00:35:30] parts of our engineering and product organizations to better align resources with our three big bets. Now, you know, to break that down, let's what are the three big bets? So there are three big bets are, um. Matthew "Spot" Fulton: The, there. Dan DeLong: Was five of them. So I guess they've consolidated their streamline. Matthew "Spot" Fulton: Those two, they got laid off. They've laid off. Dan DeLong: 40% of their bets. Matthew "Spot" Fulton: Okay. Alicia Katz Pollock: So the first of the bets is scale, our AI [00:36:00] native platform to deliver easy done for you experiences the previously the done for you experiences was was QuickBooks Live and the TurboTax tax services. And you know we all have definite mixed feelings about QuickBooks Live, but that is one of their big bets is having their own workforce inside that inside QuickBooks. Matthew "Spot" Fulton: I have heard, but [00:36:30] not substantiated completely, that some of the layoffs were in the live area. Alicia Katz Pollock: Okay. Yeah, I have heard a rumor that live was underperforming, which we kind of know having after QuickBooks Live. Dan DeLong: What, $50 a month is not substantial for. Alicia Katz Pollock: I guess people were not not enough people were taking advantage of that $50 a month paid, paid support line. Yeah. Okay. Uh, the next, uh, [00:37:00] the second big bet was be the center of money for consumers and businesses. Um, having the platform be the primary financial engine so that customers can access, manage, and grow their money with confidence. And so we've been seeing a lot of that. That's QuickBooks payments, that's QuickBooks bill pay. That's, um, QuickBooks money, which is its own app. It's the ability. What's that? Matthew "Spot" Fulton: The new. Alicia Katz Pollock: There's a. Matthew "Spot" Fulton: There's a. Alicia Katz Pollock: New credit card coming out. It's the ability to. [00:37:30] Matthew "Spot" Fulton: Short term loans. Alicia Katz Pollock: Exactly. The lending and loans on the estimates and now the the buy now pay later um that they're introducing. So they're basically trying to help people's cash flow. And so that's there. And of course that's going to be good for them because then they're making interest and you know, so it's a good revenue stream for them. Matthew "Spot" Fulton: They are. I mean, they're using third party institutions as the actual banking. And who's responsible for the FDIC? Everything else. Right. So into. [00:38:00] It's not the direct piece of that. I think the bigger part of this is create a platform that people live in as much as humanly possible for a business, and they don't ever want to leave it because once you're in it and you're really ingrained in it, it becomes that much harder to ever leave it. Dan DeLong: Yeah. It's like, it's like trying to delete your Facebook account, right? Like it's real easy to set up. But once you, if you wanted to delete and remove all your pictures, [00:38:30] that is part of the. That's quite. Matthew "Spot" Fulton: A, I tried. Dan DeLong: An undertaking. Matthew "Spot" Fulton: I tried my Alexa set marks calling for you, marks calling for you. And it didn't work. So. Alicia Katz Pollock: Okay, so so we know that they are still continuing to lean in on being the financial partner so that you can just do it all right inside your QuickBooks. Um. All right. And then and also Credit Karma, because Credit Karma is all about promoting credit cards, right? Like, [00:39:00] oh, you've, you know, and financial solutions. So okay, we get that. And then the big bet number three is accelerate our authority and right to win in the mid market. So that is all about QBO advanced and enterprise suite that, that they're, they're putting their eggs in that basket. Matthew "Spot" Fulton: Does that mean that they feel they fully win this. They already won the small market. Alicia Katz Pollock: I think so. I think maybe they they don't feel like they need to play there anymore. Or [00:39:30] because, you know, up until now they've been the, the um 300 pound elephant, not 300 pound three ton elephant in the room. You know. Matthew "Spot" Fulton: That's a pretty lean elephant. Yeah. Alicia Katz Pollock: I'm gonna I'm gonna back up on that one. Matthew "Spot" Fulton: Oh come. Alicia Katz Pollock: On. Matthew "Spot" Fulton: Gonna be fun. Alicia Katz Pollock: Okay. Um. I'm mixing my metaphors, mixing my metaphors really badly here. Um, but but, you know, basically they're, they had a monopoly on the small business [00:40:00] accounting, um, accounting realm and maybe they're feeling that they can sit on their laurels about on that because, you know, we've talked about this a lot, that one client acquisition on enterprise is worth a dozen simple starts, right? Or more. Um, and so by leaning in on that, they're getting more bang for the bang for the buck. Um, all right, so taking that back to the, um, back to Suzanne's statement [00:40:30] about it, if they're finding that certain things are underperforming, like MailChimp, they bought MailChimp. I've been using MailChimp for well over a decade. And when they bought MailChimp, our first thought was, please, please, please don't break it. Please don't break it. Please don't break it. We literally like and we're like, all in on MailChimp as our marketing engine, but offering it to the ProAdvisor as a benefit. Maybe not as many people were taking advantage of the discounts that they get through it. It I never even you know, I've [00:41:00] been doing this podcast now for two and a half years, and I still haven't done the MailChimp episode that has been on my to do list for two and a half years that I don't know if people know this, but you can go into MailChimp and create an email segment out of a product that people bought. So if people bought one of your products or services, you can send them an email and make them offers. And people haven't been doing that. So I think the problem with MailChimp isn't MailChimp. The problem with MailChimp is that they never really properly [00:41:30] leveraged the integration with QBO and didn't really leverage it, get people to adopt it. So I think that's unfortunate because I don't if this is saying we are reducing MailChimp, I got a problem. I got an operational problem in my business because we are literally have have email chain email workflows that have been in place for ten years that I don't want to have to go rebuild all that. Matthew "Spot" Fulton: The [00:42:00] question there, I mean, to dive in deeper is, yeah, so Intuit owns MailChimp. I'm sure they still have, they should still have a core structure of the people that use MailChimp that have nothing to do with Intuit. Right? Right. And hopefully that part of it isn't going to be touched. And more of this is it could be part of it is they've already done these integration pieces between QuickBooks online and MailChimp, and those are some of the people that are no longer being needed there [00:42:30] and could be re, you know, rehoused or repurposed somewhere else possibly. Um, because I will say recently, we're starting to see the ability to request reviews inside of QuickBooks online. The, you know, those little features and functions people aren't talking enough about that is the direct integration of MailChimp that people don't understand. That's what's behind the scenes. So maybe they've got it to a point where they're comfortable and they're moving some people to do some other stuff. Dan DeLong: Yeah. I mean, we've [00:43:00] seen all we've we've seen all sorts of acquisitions that where they have, they have just, uh, we like that piece and we're going to use it. Right. Like, or we like your customer base and we're going to use them. And I think MailChimp was one of those things that was so large, uh, that, you know, it, it probably needed to be broken down. And we're probably all right in some, in some facet of, of all of this, um, [00:43:30] as our, as we're just kind of speculating here as to what is actually going on. But to your point, that is that's the power of these two. Like, you know, when these two join up, you know, QuickBooks having this, this the sales and financial history of your customers and then the journey of your prospective customers. Now you can, you know, combine these things and, you know, always saw it as a great promise of these two [00:44:00] and made made a whole lot of sense because, hey, if I could automate a recurring customer or automate a customer to be a recurring customer, that is just, I mean, that that's a big win for small businesses. Alicia Katz Pollock: Yeah. Well, I'm hoping that you're right and that it's not wishful thinking because I did actually pull up something from their earnings call, their Q3 earnings call that says MailChimp remains a drag on growth, with Intuit scaling back their investments [00:44:30] into MailChimp to treat it more as a profit center versus a revenue growth driver. Continue to see pressure in SMB churn. New customer acquisition while mid-market and SMEs are showing some promising signs until it seems open to a potential divestiture of MailChimp. Matthew "Spot" Fulton: Interesting. Dan DeLong: Maybe they got what they wanted. Matthew "Spot" Fulton: The data. Alicia Katz Pollock: Yeah. I mean, like I said, for me, I [00:45:00] not knowing the realities around these, being able to use your built in email to retarget your sales is a huge revenue opportunity that has is in the software didn't work 100%, but worked well enough for me that I was using it. And we all know that the, you know, your road to profit isn't new client acquisition. It's leveraging the clients who [00:45:30] are already purchasing for you. So if they came and got that service from you, being able to say six months from now, hey, do you need us again or you bought this service, would you like to upsell you on this other service? I think it's a missed opportunity if that's not where Intuit is focusing their energy. Matthew "Spot" Fulton: I think they're jumping the gun. If you take into account AI, right? Because isn't this where AI really would start to kind of be that bridge and really solidify the relationship between the two? Having the AI start to help really [00:46:00] understand and handle this stuff. Because I think small business, like small, medium sized businesses aren't thinking about how to do that stuff enough. And I could really help handle that and make it more profitable. Alicia Katz Pollock: I mean, I'm not the one with the hands on in our MailChimp anymore. That's somebody on my team. So I haven't actually made a newsletter myself now in five years, but I used to. I don't know what the AI capabilities in MailChimp are. I don't maybe they're lagging behind on, on doing that. And there's other other, um, email [00:46:30] marketing software that's doing better at it. Unfortunately, I'm just speculating. Dan DeLong: And then, you know, Alicia, we, you and I went to the, uh, the an Intuit sponsored event at in Mountain View, uh, a couple years ago. And they had, you know, a presentation from, uh, the, the, the c c someone, uh, I don't know if the CEO or CTO or c something, um, talking about, you know, [00:47:00] we want to get it right. You know, we want to get the integration right. Um, maybe they can't, you know, and maybe that's, maybe that's it. Matthew "Spot" Fulton: Yeah. Alicia Katz Pollock: But you could, you could absolutely be right. They tried and just weren't able to do it. And so now they're cutting their losses. Matthew "Spot" Fulton: It'll be interesting to see. I mean we, I, I can't think of another time we've heard about Intuit, um, selling off some, you know, a part of their company. Dan DeLong: They're usually the amoeba of, [00:47:30] uh, of, of the companies, you know, we'll just absorb you and we like what you do and we'll, we'll do that in it is kind of, um, backwards, right? To, to hear about a divestiture, right where it doesn't fit in, especially when it is something that is directly ancillary, you know, to, um, and complementary to, to a business service that they already have. Alicia Katz Pollock: Yeah. And it was a software that did a really good [00:48:00] job at what it did. So I hope that this is not the demise of MailChimp that'll destroy me. Matthew "Spot" Fulton: There was another piece that you, you spoke about in there, which I think was pretty interesting. It was the that they acknowledged and recognized the churn in the SMB realm. Alicia Katz Pollock: Which means people are trying it and then bailing, bailing. Matthew "Spot" Fulton: Yeah, people leaving the product in the small business environment. But obviously that number is not greater [00:48:30] than the increase in the mid-market, like you're saying. So it goes back to that conversation we were talking about before. Matthew "Spot" Fulton: So yeah. Dan DeLong: I think I think the probably the large I mean, I think that is that is the, the nature of the market that we are in today. Right. Is that people are looking for a faster, cheaper way to do things. Right. So, you know, they may have found like, well, I can do this in ChatGPT or I can do this with X, you know. Matthew "Spot" Fulton: And, uh. Dan DeLong: You know, [00:49:00] and they are probably finding that, well, what's the value of this software to do it for me? If I could just, or maybe, uh, something that I have does something similar then to, to, uh, you know, or it would be a big lift to move them from one to the other. And maybe they don't do it doesn't do you know exactly everything that they want it to do? Alicia Katz Pollock: Okay. Well, I hope we're not doing our IP [00:49:30] MailChimp battle, and I don't want to put that out there. Anybody from Intuit who's listening. Don't break it. Whatever you do, don't. Don't make it go away and don't break it. Make sure MailChimp exists as an entity because it's been the market leader for ever. Dan DeLong: Quicken is still around, right? I mean. Matthew "Spot" Fulton: Right. You know, just, you know, keep. Dan DeLong: That in mind. Matthew "Spot" Fulton: Right? Dan DeLong: Like quicken is still around. They, they, they sold it off. Another company bought it, but that brand is still around. Alicia Katz Pollock: Okay. [00:50:00] So there's life after Intuit, not just for the employees, but for the. Matthew "Spot" Fulton: For the companies. Alicia Katz Pollock: Okay. Well, I don't want to start playing taps for MailChimp. So we're not I'm not going there. I'm either we're off base or I'm in denial. But nobody listening to this go, huh? This is a good idea. No. Bad idea. Um, anyway, I think actually doing another episode where we dive into the third quarter recap and actually go through all of the stats and findings from all the divisions of Intuit would actually help this conversation. So we [00:50:30] will put that on the to be continued. As we monitor the health of the organization that we all know and love, or at least know and provides us our entire company. What do I want to say here? Um. Matthew "Spot" Fulton: It's a love hate relationship. Matthew "Spot" Fulton: That we, we, um, we cherish. Alicia Katz Pollock: Yeah. Yeah. Intuit is responsible for all of us pursuing our passions and building careers that we love. We don't, we [00:51:00] want to continue to survive and thrive together as a team. Matthew "Spot" Fulton: I thank them for helping to connect me to small businesses and different businesses around the world. So thank you for that. Alicia Katz Pollock: All right. I think that's a great place to, to, to close it down for today. So let's do our ending segment. Spot what's going on in your world. Matthew "Spot" Fulton: You know I have got I get to have a visit here pretty soon from a good friend of mine, Linda. She's coming out to San Diego for a conference, [00:51:30] probably by the time this year it'll be all done. But. So spend a little time doing that. And, um, you know, just getting back into the swing and continue to do some more work and jumping back in. Alicia Katz Pollock: Great, excellent. Well, say hi to Linda for me. And you know, you guys will have a great time, um, collaborating together for sure. Yep, yep. All right. And Dan, what about you? Dan DeLong: Well, in, uh, after scaling new heights, which is coming up, uh, doing a breakout session with [00:52:00] Carrie Kahn there, and then in July, we are going to be doing a four session cohort on bulk editing things inside of QuickBooks. So we got the we're going to do a session on desktop. So for all your desktop folks, if you want to participate in, in that, um, and then we'll do a session on the tools that are inside of Qbo. And then we'll talk about, you know, external tools like, uh, right tool pro being able to bulk edit things and, um, SaaS and [00:52:30] tools and external tools as well. So we're looking forward to, you know, having a great, uh, great cohort on that. Alicia Katz Pollock: Great, excellent. Yeah. The, the, the link to it will be in the show notes so that you can join it. And Dan, what's your session with Carrie at scaling? Because I think this episode should be coming out before scaling. Dan DeLong: Yeah, it will be all about, you know, changes in QuickBooks. You know, what's what's happened over the last year, uh, and then as well as the AI, um, [00:53:00] functions that are inside of QuickBooks as well as, um, I think we had talked about the, you know, protecting your login, you know, with all of those. Matthew "Spot" Fulton: Um. Dan DeLong: We did a session, um, or a podcast about, you know, law login vulnerabilities. So, um, as we get everything in, uh, as, as things are evolving into the login being the source of truth to get to things. You want to make sure that those logins [00:53:30] are secure and not not open to bad actors. Alicia Katz Pollock: Yeah. And we so Dan was referring back to an episode that we did about your entire Tuitt account. We'll have the link to that in the show notes. I believe it was episode 80. Like it's in the 80s. Like that was some time ago. But we definitely go into detail about everything you need to know about your account. So I will look forward to your session at scaling for sure. Matthew "Spot" Fulton: Alicia, what [00:54:00] about you? What do you got coming up? Alicia Katz Pollock: So, um, scaling is going to be an adventure for me. Royal wise is at booth number 100. We are promoting two two Tuesday this year, so we have blue tutus for everybody to wear on Tuesday. So you can pick one of those up from the booth, and you can even get a matching Royal white t shirt if you'd like. Um, we have new alleys specifically for the podcast. So unofficial QuickBooks accounts podcast has. I don't know if everybody here has seen them, [00:54:30] but I make these little resin owls so we don't give away plastic crap for swag at conferences. I actually make art. And so you can get a podcast hourly. And, um, I'm speaking on Tuesday, I'm doing a power breakfast with Amanda Aguilar from zero and we're doing kind of a compare and contrast about the new features in zero and in QuickBooks. Um, it's not a competition for those of you who are going to like, see which one's better and which one wins, that's [00:55:00] not the purpose of the session. We're really focusing on who's the best fit and why. Dan DeLong: Two general ledgers enter one leaves. Matthew "Spot" Fulton: Yes. Alicia Katz Pollock: Yes, exactly. Um, and then on Wednesday, this is a secret for all of you podcast listeners. On Wednesday, um, we have cabana number nine. And so you can come out and float in the pool after the whole thing is is over. So come join us for that. Dan DeLong: Unwind and relax. Wow. [00:55:30] Yeah. At a conference. Is that. Is that possible? Matthew "Spot" Fulton: Yeah. Well, you go to him, right? Alicia Katz Pollock: And I want to give special thanks to Kathy Grosskurth and Roundtable Labs for helping us put on the put on the the put on the cabana and help feed people and give you libations. Um. All right. So, so there's that. And then the big thing, the big thing that I want to announce is that we have opened up enrollment for my hands on training class. This is an annual event. It's a college style [00:56:00] class where I'm teaching the textbook that I write for Kristeva Consultants. And so it's really a college style class where we meet on from July 20th 1st to October 8th. So 12 weeks, two mornings a week, Tuesdays and Thursdays from 9 to 12:00, where we're going to, uh, build actual company's hands on, click by click and step by step in Qbo. So I provide you with a blank file as part of the class, and I provide [00:56:30] you with the textbook. And we're going to go through and you're going to learn how to use every single feature. In real life case studies, the course is $2,500. But if you register now in June, you get a $250 discount. So it'll be 2250. If you took the course with me in the past, you get half price, it's 1250. So for those of you who have taken it before, just let us know that you want to take it again and we'll get you the 50% off coupon. And I'm really excited about it because [00:57:00] it's a different style class for me, where I get to be a teacher again, back the way I used to be, where I'm actually like, students are asking me questions and asking me for help with things. And so I'm looking forward to it. Dan DeLong: Because you should be the top ProAdvisor educator of 2026. Matthew "Spot" Fulton: Oh yeah. Alicia Katz Pollock: Let's actually throw in a little bit about that. Dan's referring to the fact that I'm in the top five for insightful accountants. Top ProAdvisor awards in the educator category. [00:57:30] And Dan is also up there. He's in the top five for desktop conversions. Dan DeLong: So it's integrations, desktop integrations, not migrations. Matthew "Spot" Fulton: There's oh. Oh yeah. Alicia Katz Pollock: I got that wrong. Okay. So he's our he's still our desktop integration guy. And, um, I love the fact that you're in the top five for that category. And thanks for all your hard work there. Dan DeLong: It's very surreal. You know, coming from the company that I used to work for, talking to the people [00:58:00] that I used to talk to and being part of that community is, um, I really, I can't express enough gratitude towards, towards that. It's, it's very, and it's very weird in the grand scheme of things. Matthew "Spot" Fulton: You've earned it, both of you. Congrats. Alicia Katz Pollock: Yeah. Thank you. Get it? Being the being the top educator is on my bucket list, and just making it to the top five is really gratifying. So thanks [00:58:30] to Insightful Accountant and to thanks to all of you who voted for both of us. All right, so let's go ahead and wrap it up. Thank you guys for helping break down all these announcements. And, um, you know, our love goes out to all the intuitive employees who were let go. Eve. You know, one door closes, another one opens. We can't wait to see what you do next. And my heart goes out to all of you left behind for all the retooling that you have to [00:59:00] do to figure out how to make it work. Um, we love you. Matthew "Spot" Fulton: Thank you. Work. Alicia Katz Pollock: Yeah, we love you. We do. Thank you all for listening. Thanks for all being here and we will. Matthew "Spot" Fulton: See you in. Dan DeLong: The. Matthew "Spot" Fulton: Next one. One.