Venture Workspace is a leading co-working space provider in South Africa, with multiple locations across the country. As a fast-growing startup themselves, Venture Workspace struggled with cash flow issues caused by late customer payments on their monthly membership fees. We spoke with Louis Fourie, one of the directors at Venture Workspace, on how they solved slow payments by implementing Paidnice's accounts receivable automation.
With tight margins common in the co-working industry, Venture Workspace relied on customers paying invoices quickly to maintain positive cash flow. However, according to Fourie, they faced regular issues with late payments: "we've got very high costs. It's not just the rental, but it's internet. It's salaries. So we do rely on seeing a quick return on invoices being paid."
While their membership agreements included late fees, the process of enforcing them was entirely manual. As Fourie explains, "in our agreements and on the invoice, we've always said that there's a late payment fee. And interest gets calculated on that overdue amount. But now my managers having to make the telephone calls initiating the process." This manual process was time-consuming and inconsistently enforced.
With scaling challenges as well, Venture Workspace needed to automate accounts receivable.
After reviewing options, Venture Workspace decided on Paidnice for automated invoicing and accounts receivable. Paidnice automatically detects unpaid Xero invoices and issues configured late fees, interest charges, and payment reminders to customers directly via email and SMS.
Automated late fees - Paidnice automatically detects unpaid invoices in Xero and adds configured late fees or interest charges. This eliminated the manual work of calculating and enforcing their existing late payment rules.
Increased collections - By systemizing the process, Paidnice increased the number of customers paying late fees from around 25 per month down to under 5. The additional late fee revenue improved cash flow.
Less confrontation - Because late fees came directly from Paidnice instead of their own staff, it reduced awkward conversations about late payments with customers. As Fourie explained, "what I found with Paidnice, because it's coming from a different platform and not Xero there was no offense was taken by suddenly slapping on the late payment fees."
Since implementing Paidnice, Venture Workspace has seen measurable improvements in their accounts receivable process:
- 25% late payers down to under 5% per month - A 5x reduction in late payments
- Increased late fee revenue from consistent enforcement
- Faster invoice payment turnaround by customers
- No more manual work calculating and enforcing late fees
- Reduced friction with customers over late payments
As Fourie summarized: "The impact of implementing the Paidnice system into our billing has positively affected our cash flow...One thing less to worry about."
By automating their previously manual accounts receivable processes, Venture Workspace reduced late payments and improved cash flow. Paidnice gave them the systemization needed to scale up smoothly.
Louis Fourie
Venture Workspace
