Erik’s Health-Tech Startup Relies on FreshBooks to Keep Cash Flow Strong
One business leading this movement toward quicker, easier lab testing is Houston-based ORDRS. It handles every step of the testing order and delivery process, including physician oversight, logistics, and fulfillment to get kits to patients, and coordinating tests and results with the lab.
Houston native Erik Ibarra founded ORDRS in 2018 after he recognized a need in the market working as a healthcare software consultant. We chatted with Erik to learn more about how his rapidly growing tech startup uses FreshBooks to be less hands-on with his finances.
ORDRS provides lab test kits and the technology behind it
Initially, how did you get ORDRS off the ground?
Erik: We’re a proud, 100% bootstrapped venture because we were able to map out how we would earn dollars from day 1. Our experience in the healthcare consulting world allowed us to understand exactly what we needed to build, how to bring on customers, and the revenue we could make.
So it was all smooth sailing from the start?
Erik: Just sunshine and rainbows the whole time. [Laughs] You, know it’s like a roller coaster. It has peaks and valleys. We were fortunate to start out with a network of folks who were potential customers and were excited about what we were building, but we really had to listen to them and respond quickly. We needed to learn to evangelize our business better and provide better documentation. There’s always room for improvement.
Why did you first start using FreshBooks for ORDRS?
Erik: I had used FreshBooks before in my consulting business, but honestly I didn’t really value it until I started digging into the features for ORDRS.
We did a lot to compare software features and I think just hands down FreshBooks was the most approachable, it gave us the most visibility on our business and allowed us to do a lot on the scalable side. You know, emailing customers all the time to pay their bill is not scalable and FreshBooks does a lot to help us with that.
Once we started really looking, FreshBooks had quite a few features that we realized we had to have to make our job easier.
After comparing other software, why did FreshBooks Payments stand out for you?
Erik: We started thinking about the time between when our customers incur their bill, when we bill them, and then when they pay, and thinking about our cash flow. The last thing we wanted was to be worried about who owes us money and what happens if we miss payments.
We saw that ACH was an option with FreshBooks and we knew we could get paid faster with that. We wanted to make sure we gave our clients the most convenient option available to pay. The credit card payment option is important, but the ACH payment option was super important for us.
Founder/CEO Erik Ibarra and Integration Lead Steven Gonzalez Jr. at ORDRS office in Houston
With fast and easy payments a priority for your customers, how has FreshBooks helped you get paid faster?
Erik: In my previous experience with customers, if you send them an invoice with payment terms of net 15 days, they wait until the 15th day to pay it. Then very often if they miss it, you have to send them another email. And even if they do pay by the 15th, waiting for a check or a wire just takes so long.
So now we can say, look, you have two options: there’s a bank transfer and there’s ACH. And also, if it’s $1500 or less, we will turn on the credit card feature, which is another super important thing. You can turn on and off whether or not you want to accept a credit card. And then once they pay we typically get the funds deposited in 1 to 2 business days.
Are you using automated Payment Reminders with your clients?
Erik: Absolutely. We set probably 3 payment reminders per invoice. We discovered that if you remind somebody 3 days after you sent the invoice, they tend to pay it right away. We send our invoices at the beginning of the month and some people will pay that day. And so that’s super helpful. Then there’s a 3-day reminder and I think our next reminder is at the 10-day mark, and then at the 15 -day mark.
Nice to hear Payment Reminders work so well for you. What else about FreshBooks Invoicing do you like?
Erik: Our customers might create 100 orders one month and 500 the next. So we knew we needed to be able to duplicate an invoice quickly, change some data, and then get it out. FreshBooks makes that easy.
And the visibility on whether someone has seen your invoice or not—that’s super important. Because if someone hasn’t, I will send them an email or I’ll use the platform to send them a message. We use the Invoice History section a lot to see if that person has viewed their invoice, or if there is a payment, but it just hasn’t been posted yet. We like having that transparency of knowing what’s going on with our payments.
What impact did COVID have on business growth for you?
Erik: We’re in lab testing, so during the pandemic, there was this huge spike in business. You know, what’s great about increased revenue is that it’s increased revenue! What’s not great about it is that it’s typically also increased expenses. And the timing of having that cash in hand to be able to pay for those expenses… It can actually crush companies. That was our biggest concern.
That influx of business was going to cost us a lot in ACH fees, and we had seen in the past that deposits would come in at maybe 3 to 5 days. We were considering using a different service. But we talked with someone at FreshBooks who actually helped us save money by moving to the next level of service with lower, set ACH fees. They were able to give us reassurances about the timing of our deposits, allowing us to get that cash in sooner.
We spent a good amount of time on the phone with some amazing folks from your team to make that happen. We’re very happy with how that works out now in terms of the timing of deposits.
How does FreshBooks help you deal with the complexity involved in growing your business?
Erik: The simplicity of FreshBooks allows us to be a little more hands-off than what I’ve experienced in the past with other accounting software or invoicing software. That’s one thing I appreciate for sure.
For the first year or two, I was doing all the financial reporting myself. But the business is growing to the point where I—me personally—need to be outside of FreshBooks. The fact that we can integrate quickly with other services like Bench allows us to hand off the reporting and let them assist with that.
Tell me a bit about Houston and what it’s like to run a business there.
Erik: We have a growing tech scene in Houston, but the industry here is historically very B2B. And so you don’t see the signs of all of these amazing startups on as you drive down the street because they’re not marketing to consumers in Houston. So it is kind of challenging from a maybe a talent perspective or visibility perspective.
And you know, Houston has a history of space and health care and oil and gas energy, and so we’ve got so many talented people. But you’ve got to pound the pavement to find those people and get them in the right job before they leave for Silicon Valley or Boston or New York. So you have your challenges there, but on the other hand, we have a growing tech scene and so those challenges are starting to become a little less difficult.
