The Anti-Consulting Model: Inside Zeni’s Strategy to Eliminate Hourly Billing in Finance Services
Hourly billing has been the standard in financial services for decades. But in a recent episode of Category Visionaries, Zeni co-founder Swapnil Shinde revealed how this traditional model actually creates perverse incentives that work against customer interests.
The Problem with Traditional Pricing
The issue becomes clear when you look at how traditional finance firms operate. “A lot of finance firms will actually start at $2000 to $3000 a month because they will sit and do everything for you manually,” Swapnil explains. “You have a bill to process, they will charge you hourly for that. You have to recognize your revenue, they will charge you hourly for that.”
This hourly billing model creates a fundamental misalignment: “When someone works on an hourly basis, they actually create more work for themselves. They will add more manual stuff so that they can charge you for more hours.”
The Real Cost of Fragmented Services
The problem goes beyond just high hourly rates. As Swapnil notes, “Typically what startups do is like they hire a part time bookkeeper to manage their books. Then they have an admin who takes care of their bill payments and expense management. At some point they need a temp CFO.”
This fragmented approach leads to multiple vendors, each charging hourly rates, with no incentive to make processes more efficient. The result? “Excel sheets are flying back and forth over email. No insights are real time. Your books are not even closed till two weeks into the next month.”
Reimagining the Business Model
Instead of trying to optimize the existing hourly model, Zeni created something entirely different: “We are incentivized to automate stuff for you because we are a SaaS platform. So it completely changes the ballgame.”
This shift from service to platform fundamentally changes the relationship between provider and customer. Rather than charging for time spent, Zeni focuses on value delivered: “If you go to our dashboard, you will feel as if a finance expert is speaking to you about all the insights, like why did your burn increase? Why did your opex increase?”
Balancing Automation with Expertise
While automation is key to their model, Zeni recognized that pure technology wouldn’t be enough. “AI cannot power 100% of it. So we have a dedicated team of finance experts who collaborate with AI to stitch an experience that is ten x faster than what you might have today.”
This hybrid approach allows them to maintain quality while dramatically improving efficiency: “We work on your books faster. The books are more accurate because those finance experts are now augmented by AI.”
The Market Response
The success of this new model is evident in the numbers. Zeni now manages “more than $1 billion in finances every single month” across “close to 400 startups,” with “70% of our customers are actually moving to us from using finance firms.”
Looking Ahead: Reimagining the Category
The goal isn’t just to change pricing – it’s to transform how financial services are delivered. As Swapnil explains, they’re building “that one all in one finance operation platform that uses Gen AI to run your entire finance department for you.”
The evolution continues as they move from “people assisting the platform to do your accounting and bookkeeping” to where “the platform will start assisting the other human experts.”
For B2B founders looking to disrupt traditional service industries, Zeni’s approach offers several key lessons:
- Identify misaligned incentives in existing business models
- Create pricing structures that align with customer success
- Use technology to fundamentally change service delivery
- Maintain human expertise while scaling through automation
The key isn’t just to offer a better price – it’s to create a fundamentally different value proposition that makes the traditional model obsolete.