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My dad owns a successful chain of bicycle stores in Texas. He’s been in business for almost 51 years and he’s one of the largest bike dealers by volume in the

My dad owns a successful chain of bicycle stores in Texas. He’s been in business for almost 51 years and he’s one of the largest bike dealers by volume in the country. He has nearly a hundred employees and a bookkeeper. Despite having a proverbial dozen balls in the air at any time and despite having people on the payroll to do bookkeeping, he sits down at his computer every night at home, logs into the ERP system, and reviews sales and receipts. He catches all kinds of crazy things. Credit card fraud (before the chargeback even comes), internal theft, mis-priced items, mistakes, you name it. He has great employees but even the best make mistakes and he’s learned this habit over the decades the hard way. I remember sitting next to him as a kid, watching him pour over cash register journal tapes that were yards long, looking for problems. My point: if you let this kind of fuck-up go undetected for over three months, you have to at least assume some of the blame and acknowledge that you probably could have caught it if you scrutinized transactions. Every good business owner does it.

white_dragon88 5y ago
[dead]
lbriner 5y ago
I think this is an unfair comparison. There is a big difference between checking the work of multiple employees who might type stuff in wrong or credit card fraud compared to OP who has a fully integrated billing system provided by a very large and well-funded company who have failed to get some real basics right. The MINIMUM most people would expect would be a notification either by email or on the dashboard to say that an invoice cannot be processed and at least that would highlight the problem. Even better, when you enable Stripe Tax, it should highlight the people who cannot be charged tax and likewise when you add a new customer who doesn't have the right info, it should notify you. I find it really frustrating when a multi-billion dollar company cannot think of UX 101 and the customer has to do the heavy lifting.
- kelnos 5y ago
  Agreed that Stripe has some product & UX issues here, but if I'm going to make big changes to how my customers are billed and taxed, I'm going to very carefully watch the result of those changes for a while to make sure it's working properly. Seems like OP didn't do that, and that's pretty irresponsible, IMO.
- mrjin 5y ago
  Agree. Such behavior is unacceptable for a paid service. I can understand there would be bugs etc., but leaving draft invoice dangling there without any alarms raised is beyond reasonable. Let invoices go out and help the client collect the money on time is vital for such products. It's eye-opening to see someone blaming the business owner instead of the software vendor.
danpalmer 5y ago
Your Dad has 100 employees to delegate to, and therefore has time to go into detail on the things that matter to him, in this case sales and receipts. This guy is working alone and likely has less time to go into detail like that.
g051051 5y ago
OP assumed that Stripe would get it right exactly as they wished it would work, and wasn't verifying it. The problem literally started as soon as they enabled it: "I deployed it on November 6, 2021, the same day that Stripe stopped billing a significant number of my customers, left all their invoices in a Draft state, and didn’t tell me about it." This is just another variant of "cloud first" mentality, assuming that cloud service providers are actually going to be better than you (as opposed to just cheaper) in carrying out these tasks. The companies I've worked for put enhanced auditing and reporting in place before this sort of thing went live to make sure it was working right.
- indymike 5y ago
  > This is just another variant of "cloud first" mentality, assuming that cloud service providers are actually going to be better than you (as opposed to just cheaper) in carrying out these tasks. I think it is a variant of "assumed correct" which gets me into all kinds of trouble when I make that assumption.
rendall 5y ago
> ...and he’s learned this habit over the decades the hard way... Yes. 51 years in business. I'm positive that the "hard way" that Dad learnt his lesson was by losing money. Please do not be judgmental of OP.
neycoda 5y ago
I agree that a business owner should be tallying things at minimum every month to make sure numbers add up, but Stripe handled the screw-up poorly, and needs some serious retribution.
chrissnell 5y ago
One more thing to add to this: scrutinizing transactions isn’t just for catching bad stuff. It’s also a way to spot the good. For my dad, it’s a way to spot up-and-coming salespeople who are punching above their weight, for noticing high-dollar sales to repeat customers and making sure that those folks are well cared-for. It also tells him what bikes are selling well and helps him make strategic decisions for buying. For your SaaS, it might be noticing patterns across your customer base and using these patterns to refine your product to cater to a certain facet of customer that seems to like your product, or spotting potential transactional issues before they cause a churn.
- ovao 5y ago
  To be fair, in this case, the author was tracking his KPIs, and those suggested that all was hunky dory, but what he wasn’t tracking were the actual payments being received against invoices that never converted to an open state. In this case, the invoices were left in a draft state on Stripe’s side. And who could’ve expected that they’d need to occasionally check for draft invoices? It seems like it wasn’t made clear in the docs that invoices aren’t finalized in these circumstances until later.
  - kelnos 5y ago
    That feels weird to me. If some dashboard is telling me "nice, your revenue is growing!", but the money actually flowing into the bank account doesn't look right, I'm going to investigate. Immediately. I'm not going to just trust those metrics when the actual real-world measure doesn't match.
  - ckdarby 5y ago
    What is weird is how their accounting software didn't raise 5 different alerts when they have AR outside of their due dates. I have a small business and mine raises alerts all over the place when something slips the due date for AR. Is it just me thinking this is actually crazy that they didn't notice even through a quarter closing? One could argue they're a small business but then how does the business not notice multiple months of AR being delayed.
  - 5y ago
throwaway2016a 5y ago
> if you let this kind of fuck-up go undetected for over three months, you have to at least assume some of the blame and acknowledge that you probably could have caught it if you scrutinized transactions. I work in eCommerce and occasionally there will be something like a script or config gets messed up and an issue with billing will happen. And being the "expert" I'm usually the one called to fix it. I wish I could count the number of tense discussions I have had that are along the lines of: Them: We haven't been charging tax in Canada for three months because the config was wrong. Fix it! Me: (some more polite variant of) So just to confirm, this has been wrong in your ERP... hundreds of thousands of CAD of uncollected VAT... for 3 months and you're just now noticing? It is, unfortunately, an extremely common discussion. That or some close variant of.
- graderjs 5y ago
  It's funny that, with the importance of tax to government revenue, why do governments not make a habit of funding/creating really high quality tax software for businesses/individuals to use? Increases in collection efficiency have historically been associated with growth of the state coffers (and state's whose bureacracies failed to adequately capture tax had to resort to funding themselves in other ways, frequently in the past through "expansionist tendencies", ie, war--for territory, resources etc...which then only works if you can pay for soldiers and equipment). Not that governments seem great at making software (in general), but with something so critical, a focus on this seems like a "sort of" low-hanging fruit...
  - wildmanx 5y ago
    > It's funny that, with the importance of tax to government revenue, why do governments not make a habit of funding/creating really high quality tax software for businesses/individuals to use? Because there is a strong lobby that prevents it. https://www.propublica.org/article/inside-turbotax-20-year-fight-to-stop-americans-from-filing-their-taxes-for-free https://www.propublica.org/article/inside-turbotax-20-year-f... Money has too strong a foothold in American politics. (In other countries too, but especially in the land of the free.)
aaxe 5y ago
> he sits down at his computer every night at home, logs into the ERP system, and reviews sales and receipts Sorry, what? How is this OK or even normalized - he should not have to check every single receipt every night. You hire people to do that, and if they cannot do it right, you hire someone else. As OP mentioned, it wasn't a gradual thing, and when you have a lot of customers, it can easily slip through. Even your father would be the same here - if a few people who should have been charged a recurring bill did not, how would he remember that? > Every good business owner does it. Absolutely not. Every good business owner gets someone to take care of it, and then double checks their work at times.
- spoonjim 5y ago
  LOL did you miss the part where he said his dad has 100 employees and is one of the biggest bike dealers in the country? How successful is your company?
- pottertheotter 5y ago
  Yeah, this is nuts. Sounds like he has no internal controls, except for going over everything each night. But that’s not a very smart nor efficient way to go about it.
  - wildmanx 5y ago
    If you compare that dad story to the SaaS story that this article is about, it's pretty clear whose strategy is more successful.
- chrissnell 5y ago
  My dad is not next to me to reply, but your rebuttal patterns a conversation that he and I had many times over the years, when I was first getting my start in business and tried to tell him he was too old fashioned in his business methods. The bottom line is that you absolutely have to be involved in all levels of your business if you want to be successful and don’t want to be taken advantage of by the unscrupulous. This doesn’t mean that you shouldn’t trust your folks. In fact, he’ll be the first to tell you that you have to trust your people. But, bottom line, you can’t outsource this level of care and attention to detail; you must be involved and you must be constantly on the lookout. It sounds like a lot of work but over the course of many years running the same business, you develop a sixth sense for problems and can quickly scan a spreadsheet of receipts and spot issues. There are dozens of other “versions” of the late-night ERP scan. He can do the same thing walking across a showroom floor or taking one of the company’s Sprinter vans out for a drive. It’s a way of life for him. He lives for his business and still works seven days a week at age 74. His business is exceptionally well-run and has been recognized nationally for it. https://www.mysanantonio.com/sa-inc/article/SAInc-Flux-Bike-World-16098876.php https://www.mysanantonio.com/sa-inc/article/SAInc-Flux-Bike-...
HWR_14 5y ago
It doesn't sound like he reconciles the ERP system to the bank statements every night. That seems to be the appropriate analog. Meanwhile, the author was monitoring all the KPIs, so they were looking at what they should look at.
- kelnos 5y ago
  I would think that "money flowing into my bank account" would be a KPI. OP did seem to notice something was off there, but ignored it! Instead he decided to trust a dashboard that just told him "you revenue is growing, yay!" That seems foolish.
alexashka 5y ago
Blaming the victim, wonderful. When I step on your toe, you should apologize to me, because you could've been more mindful of your surroundings and prevented it.
astura 5y ago
How does he catch credit card fraud? What does it look like?
- mocheeze 5y ago
  I was about to reply to you, then I realized I was typing out a guide on how to commit credit card fraud. Not this time! ;) (I worked for 6 years in that side of the industry. Particularly when it might apply to point of sale software.)
- chrissnell 5y ago
  Here’s a real example that happened to him a few years ago. He was out of town on business and there was a big sale, around $15K if I recall, to a customer from Mexico. The sale was done just before closing (something he saw in the review) and the card was manually keyed in. The story was that the guy’s card “wasn’t reading” so the employee keyed it in manually, a huge red flag. The charge went through but of course ended up in a charge-back a bit later. If you weren’t scrutinizing your receipts and doing double-checking of the big sales, you might miss this until the chargeback hits. For him, there was nothing to do except educate employees and double-down on policies regarding manually-entered cards, big sales made just before closing, etc.
  - EE84M3i 5y ago
    Could you explain why a big sale just before closing is an indicator of fraud? I don't understand.
    - chrissnell 5y ago
      In a brick-and-mortar business, closing time is when employees (i.e, non-owners) are in a hurry to get the store cleaned up and shut down so that they can go home. They’re tired and they might feel pressured to just get the sale done. Scammers know this and so closing time is a good time to come in and try to pass off a fake credit card with a stolen number. Weekends, when many less-seasoned employees work, is another popular time.
Aeolun 5y ago
From what I understand from the article, the Stripe dashboard shows nothing wrong, and indeed, apparently shows draft invoices as income, or it’d have been fairly certain the revenue stream had cratered.

white_dragon88 5y ago

[dead]

lbriner 5y ago

I think this is an unfair comparison. There is a big difference between checking the work of multiple employees who might type stuff in wrong or credit card fraud compared to OP who has a fully integrated billing system provided by a very large and well-funded company who have failed to get some real basics right. The MINIMUM most people would expect would be a notification either by email or on the dashboard to say that an invoice cannot be processed and at least that would highlight the problem. Even better, when you enable Stripe Tax, it should highlight the people who cannot be charged tax and likewise when you add a new customer who doesn't have the right info, it should notify you. I find it really frustrating when a multi-billion dollar company cannot think of UX 101 and the customer has to do the heavy lifting.

kelnos 5y ago
Agreed that Stripe has some product & UX issues here, but if I'm going to make big changes to how my customers are billed and taxed, I'm going to very carefully watch the result of those changes for a while to make sure it's working properly. Seems like OP didn't do that, and that's pretty irresponsible, IMO.
mrjin 5y ago
Agree. Such behavior is unacceptable for a paid service. I can understand there would be bugs etc., but leaving draft invoice dangling there without any alarms raised is beyond reasonable. Let invoices go out and help the client collect the money on time is vital for such products. It's eye-opening to see someone blaming the business owner instead of the software vendor.

danpalmer 5y ago

Your Dad has 100 employees to delegate to, and therefore has time to go into detail on the things that matter to him, in this case sales and receipts. This guy is working alone and likely has less time to go into detail like that.

g051051 5y ago

OP assumed that Stripe would get it right exactly as they wished it would work, and wasn't verifying it. The problem literally started as soon as they enabled it: "I deployed it on November 6, 2021, the same day that Stripe stopped billing a significant number of my customers, left all their invoices in a Draft state, and didn’t tell me about it." This is just another variant of "cloud first" mentality, assuming that cloud service providers are actually going to be better than you (as opposed to just cheaper) in carrying out these tasks. The companies I've worked for put enhanced auditing and reporting in place before this sort of thing went live to make sure it was working right.

indymike 5y ago
> This is just another variant of "cloud first" mentality, assuming that cloud service providers are actually going to be better than you (as opposed to just cheaper) in carrying out these tasks. I think it is a variant of "assumed correct" which gets me into all kinds of trouble when I make that assumption.

rendall 5y ago

> ...and he’s learned this habit over the decades the hard way... Yes. 51 years in business. I'm positive that the "hard way" that Dad learnt his lesson was by losing money. Please do not be judgmental of OP.

neycoda 5y ago

I agree that a business owner should be tallying things at minimum every month to make sure numbers add up, but Stripe handled the screw-up poorly, and needs some serious retribution.

chrissnell 5y ago

One more thing to add to this: scrutinizing transactions isn’t just for catching bad stuff. It’s also a way to spot the good. For my dad, it’s a way to spot up-and-coming salespeople who are punching above their weight, for noticing high-dollar sales to repeat customers and making sure that those folks are well cared-for. It also tells him what bikes are selling well and helps him make strategic decisions for buying. For your SaaS, it might be noticing patterns across your customer base and using these patterns to refine your product to cater to a certain facet of customer that seems to like your product, or spotting potential transactional issues before they cause a churn.

ovao 5y ago
To be fair, in this case, the author was tracking his KPIs, and those suggested that all was hunky dory, but what he wasn’t tracking were the actual payments being received against invoices that never converted to an open state. In this case, the invoices were left in a draft state on Stripe’s side. And who could’ve expected that they’d need to occasionally check for draft invoices? It seems like it wasn’t made clear in the docs that invoices aren’t finalized in these circumstances until later.
- kelnos 5y ago
  That feels weird to me. If some dashboard is telling me "nice, your revenue is growing!", but the money actually flowing into the bank account doesn't look right, I'm going to investigate. Immediately. I'm not going to just trust those metrics when the actual real-world measure doesn't match.
- ckdarby 5y ago
  What is weird is how their accounting software didn't raise 5 different alerts when they have AR outside of their due dates. I have a small business and mine raises alerts all over the place when something slips the due date for AR. Is it just me thinking this is actually crazy that they didn't notice even through a quarter closing? One could argue they're a small business but then how does the business not notice multiple months of AR being delayed.
- 5y ago

throwaway2016a 5y ago

> if you let this kind of fuck-up go undetected for over three months, you have to at least assume some of the blame and acknowledge that you probably could have caught it if you scrutinized transactions. I work in eCommerce and occasionally there will be something like a script or config gets messed up and an issue with billing will happen. And being the "expert" I'm usually the one called to fix it. I wish I could count the number of tense discussions I have had that are along the lines of: Them: We haven't been charging tax in Canada for three months because the config was wrong. Fix it! Me: (some more polite variant of) So just to confirm, this has been wrong in your ERP... hundreds of thousands of CAD of uncollected VAT... for 3 months and you're just now noticing? It is, unfortunately, an extremely common discussion. That or some close variant of.

graderjs 5y ago
It's funny that, with the importance of tax to government revenue, why do governments not make a habit of funding/creating really high quality tax software for businesses/individuals to use? Increases in collection efficiency have historically been associated with growth of the state coffers (and state's whose bureacracies failed to adequately capture tax had to resort to funding themselves in other ways, frequently in the past through "expansionist tendencies", ie, war--for territory, resources etc...which then only works if you can pay for soldiers and equipment). Not that governments seem great at making software (in general), but with something so critical, a focus on this seems like a "sort of" low-hanging fruit...
- wildmanx 5y ago
  > It's funny that, with the importance of tax to government revenue, why do governments not make a habit of funding/creating really high quality tax software for businesses/individuals to use? Because there is a strong lobby that prevents it. https://www.propublica.org/article/inside-turbotax-20-year-fight-to-stop-americans-from-filing-their-taxes-for-free https://www.propublica.org/article/inside-turbotax-20-year-f... Money has too strong a foothold in American politics. (In other countries too, but especially in the land of the free.)

aaxe 5y ago

> he sits down at his computer every night at home, logs into the ERP system, and reviews sales and receipts Sorry, what? How is this OK or even normalized - he should not have to check every single receipt every night. You hire people to do that, and if they cannot do it right, you hire someone else. As OP mentioned, it wasn't a gradual thing, and when you have a lot of customers, it can easily slip through. Even your father would be the same here - if a few people who should have been charged a recurring bill did not, how would he remember that? > Every good business owner does it. Absolutely not. Every good business owner gets someone to take care of it, and then double checks their work at times.

spoonjim 5y ago
LOL did you miss the part where he said his dad has 100 employees and is one of the biggest bike dealers in the country? How successful is your company?
pottertheotter 5y ago
Yeah, this is nuts. Sounds like he has no internal controls, except for going over everything each night. But that’s not a very smart nor efficient way to go about it.
- wildmanx 5y ago
  If you compare that dad story to the SaaS story that this article is about, it's pretty clear whose strategy is more successful.
chrissnell 5y ago
My dad is not next to me to reply, but your rebuttal patterns a conversation that he and I had many times over the years, when I was first getting my start in business and tried to tell him he was too old fashioned in his business methods. The bottom line is that you absolutely have to be involved in all levels of your business if you want to be successful and don’t want to be taken advantage of by the unscrupulous. This doesn’t mean that you shouldn’t trust your folks. In fact, he’ll be the first to tell you that you have to trust your people. But, bottom line, you can’t outsource this level of care and attention to detail; you must be involved and you must be constantly on the lookout. It sounds like a lot of work but over the course of many years running the same business, you develop a sixth sense for problems and can quickly scan a spreadsheet of receipts and spot issues. There are dozens of other “versions” of the late-night ERP scan. He can do the same thing walking across a showroom floor or taking one of the company’s Sprinter vans out for a drive. It’s a way of life for him. He lives for his business and still works seven days a week at age 74. His business is exceptionally well-run and has been recognized nationally for it. https://www.mysanantonio.com/sa-inc/article/SAInc-Flux-Bike-World-16098876.php https://www.mysanantonio.com/sa-inc/article/SAInc-Flux-Bike-...

HWR_14 5y ago

It doesn't sound like he reconciles the ERP system to the bank statements every night. That seems to be the appropriate analog. Meanwhile, the author was monitoring all the KPIs, so they were looking at what they should look at.

kelnos 5y ago
I would think that "money flowing into my bank account" would be a KPI. OP did seem to notice something was off there, but ignored it! Instead he decided to trust a dashboard that just told him "you revenue is growing, yay!" That seems foolish.

alexashka 5y ago

Blaming the victim, wonderful. When I step on your toe, you should apologize to me, because you could've been more mindful of your surroundings and prevented it.

astura 5y ago

How does he catch credit card fraud? What does it look like?

mocheeze 5y ago
I was about to reply to you, then I realized I was typing out a guide on how to commit credit card fraud. Not this time! ;) (I worked for 6 years in that side of the industry. Particularly when it might apply to point of sale software.)
chrissnell 5y ago
Here’s a real example that happened to him a few years ago. He was out of town on business and there was a big sale, around $15K if I recall, to a customer from Mexico. The sale was done just before closing (something he saw in the review) and the card was manually keyed in. The story was that the guy’s card “wasn’t reading” so the employee keyed it in manually, a huge red flag. The charge went through but of course ended up in a charge-back a bit later. If you weren’t scrutinizing your receipts and doing double-checking of the big sales, you might miss this until the chargeback hits. For him, there was nothing to do except educate employees and double-down on policies regarding manually-entered cards, big sales made just before closing, etc.
- EE84M3i 5y ago
  Could you explain why a big sale just before closing is an indicator of fraud? I don't understand.
  - chrissnell 5y ago
    In a brick-and-mortar business, closing time is when employees (i.e, non-owners) are in a hurry to get the store cleaned up and shut down so that they can go home. They’re tired and they might feel pressured to just get the sale done. Scammers know this and so closing time is a good time to come in and try to pass off a fake credit card with a stolen number. Weekends, when many less-seasoned employees work, is another popular time.

Aeolun 5y ago

From what I understand from the article, the Stripe dashboard shows nothing wrong, and indeed, apparently shows draft invoices as income, or it’d have been fairly certain the revenue stream had cratered.