Automation, AI, and Leadership with Pairsoft’s Matt Cotter

Episode Overview

Matt Cotter serves as the Chief Executive Officer of PairSoft, a leading provider of financial automation solutions. Under his leadership, PairSoft has integrated technologies from Paper Save, Webby plex Douc Peak, and Paramount Workplace to offer a comprehensive suite of automation tools for procurement, accounts payable, and document management. This strategic consolidation has positioned PairSoft as a global innovator in financial automation, delivering seamless integration with existing ERP systems and enhancing operational efficiency for businesses worldwide.

Before joining PairSoft, Matt held several prominent executive roles. He was the Executive Vice President at Altus Group, a software, data, and services business. Prior to that, he served as President and CEO at ExactBid, a real estate appraisal management SaaS platform, until 2018. Earlier in his career, Matt was the Senior Vice President of Sales and Marketing at D+H, a loan origination software company, and held executive leadership positions at SAP, Legato Systems, and i2 Technologies.

Matt earned his A.B. in English from Duke University in 1995. He has also served on the board of directors of Vera fin, an industry leader in financial crime management SaaS platforms for financial institutions. His extensive experience in software leadership, strategic business growth, and global team management has been instrumental in driving PairSoft’s mission to provide innovative financial automation solutions that empower businesses to operate more efficiently and effectively.​

Episode Transcript

Matt Cotter: In most instances when you were dealing with mechanical things, computational things, etc., computers can be faster and better. Sitting there pressing my button, that isn’t super valuable. But if I can free up that person where they don’t have to do that and they can actually go focus on analyzing the business, making recommendations. How do I use cash more effectively? How do I deploy capital most effectively, etc.? Like those are really valuable things. If I don’t get comfortable with driverless taxis, I’m going to be doing a lot of walking around San Francisco for like next ten years. So the work, the way you interact with the technology changes and modifies. It’s not that it’s going to put everybody out of work. It’s the work that we’re doing is going to change. Right? The roles.

Kevin Rosenquist: Will change.

Matt Cotter: Automobiles were going to be the death of the town, the family, the culture, because it was far too easy to break up that nuclear unit and drive away.

Kevin Rosenquist: Hey there. Welcome to Pay Pod, where we bring you conversations with the trailblazers shaping the future of payments in fintech. My name is Kevin Rosenquist. Thanks for listening. My guest today is Matt Cotter. He’s the CEO of PairSoft, a company that uses AI to automate procurement processes. Accounts payable and document management. And I’m not just talking about a little automation here and a little there. Parasoft is truly taking repetitive, cumbersome, and mundane tasks out of the equation for people, freeing them up to spend more time helping move the company forward. Aside from discussing the specifics of automation, we also have great conversations about the ethics of AI inspiration and his approachable and empathetic leadership style that encourages Parasoft employees to be their best selves. It’s a fantastic conversation, and I’m glad you’re here to listen to it. Joining me now from just outside of my old stomping grounds in Chicago, Matt Cotter. So I’m really excited to talk with you. One of the things that is most exciting to me about AI is automation. Most of us, at least those listening to this show, have been in positions where we have to handle mundane or tedious tasks, and you guys are working to take away a lot of those, particularly in accounting and procurement. One of the things that I think is interesting is how many people, whether they’re businesses, whether they’re, uh, you know, whether they’re CEOs or, you know, entry level employees, they fear automation or they’re afraid of the change of it. Why do you think that is? And what do you do to temper people’s fears?

Matt Cotter: Well, I think part of it is branding, right? You know, the machines become sentient and all that wonderful stuff.

Kevin Rosenquist: You think that actually plays into that too? 100%.

Matt Cotter: 1%. so I think there absolutely is a branding component. I think there are some real, instances that you can point to that you know can be damaging, right? I think they’re very few, but they’re there. So I think that plays into people’s thoughts. And then I think in large part it is unknown. Right.  It is this grand, disruptive Technology that comes into the world, and we don’t know exactly what the end of the story. You can tell this same story for basically any seismic technology innovation that has happened. Automobiles and automobiles were going to be the death of the town, the family, the culture, because it was far too easy to break up that nuclear unit and drive away. So, I mean, it is a natural reaction and I think it is a natural and predictable overreaction, uh, as well. Is there is.

Kevin Rosenquist: There any component to it that is the sort of the fear of change that a lot of business owners have, or the fear of adding complexity?

Matt Cotter: Yeah, 100%. And I think it is, second order change and second order complexity. It is easy for me to describe you as an intelligent guy if I add AI this GL coding and handsome. By the way, if I add this gl, if I add ai to this GL coding how that is going to make your specific part of the world more efficient. The second order of that, though, is what then? Right. And that’s where people start to get nervous. Okay. So great. This thing is more efficient. That means I have time on my hands. What then do I need? Fewer people. That is a concern people start to ramp up about. Are the skills that need to be deployed different? Right. The initial cut of I can help make you more efficient. Everybody gets that right. That’s super smart. It’s what? Then the second order, the thing that follows. And I think that’s where we have to where I have to be better at kind of addressing some of those things. Right. You know, we talk a lot with in particular new potential customers about the ability to redeploy people into things that actually can change the business. Right. Sitting there, pressing my button, that isn’t super valuable. But if I can free up that person where they don’t have to do that and they can actually go focus on analyzing the business, making recommendations, how do I use cash more effectively? How do I deploy capital most effectively, etc.. Like those are really valuable things. Yeah.

Kevin Rosenquist: Plus it makes it it helps,keeping employees because people don’t get bored out of their minds. I mean, you know, we’ve all been in those situations where you have to do mundane tasks and it’s just, yeah, it’s hard. It’s hard sometimes to, like, stay motivated.

Matt Cotter: It’s mundane. It’s also comfortable though. Right. That’s true. That’s true. Knowing, knowing what I know, like when I come into the office, knowing what I know. And I’ve done that, like, you know, I got myself through high school and I got myself through college tending bar. Not the most intellectually, you know, still need to be firing all the time to do those things. But there’s comfort. So, you know, I think, again, I think what is incumbent on me and incumbent on us, part of the reason we want to do a lot of these types of conversations is to talk about what else can we do, what are the things that we could do to move these business forward? Um, there’s a lot of the conversations that I get to have with prospects, why I’ve got the best job in the world.

Kevin Rosenquist:  well, so bringing together paper Save and Paramount Workplace to create Persoff. It was a big leap. What specific strengths did each company bring to the table, and how have they enhanced what you guys do overall?

Matt Cotter: Yeah. So if you take kind of like half a step back, the thesis was and it’s still it still holds true. I think it’s got more meat on the bone now than it did four years ago, is if we look at P to p procurement to payment procurement through payment depending on how you want to define it. If we view that as one integrated process as opposed to kind of tangentially connected processes, right? I do sourcing, I do requisitioning, I do, I do you look at that as one process that there’s real advantage that we can bring to that, collecting credibly clean data at the front of the process through kind of sourcing more effective supplier management, propagate that all the way throughout payments. Now I can do really cool things with descriptive predictive analytics. I can add payment workstreams to it. Et cetera, et cetera, et cetera. Right. There’s just a bunch that we can do. So if you go back then to where we started when we bought Paramount and we bought Paper save. They really came at that problem from two ends of the spectrum. So Paramount came at it from a procurement workflow deeply integrated into very specific mid-market ERPs. Paper save came at it from an image management, document management, invoice management deeply integrated into those same mid-market ERPs. And so the thinking we put them together, integrate the companies, integrate the back office, integrate the product. I’ve got the beginnings of that end to end view of a platform. We went and bought a company called Plex that added that same process, those same flows, but into NetSuite, into a different one, launched our own analytics product, launched a partnership on payments, and then bought the Dutch company in Q1 of this year, which takes us into Europe, brings us up market into that Oracle stack. Et cetera. So but it all comes back to that. Am I connecting this thing into one process? And similar to the AI stuff or AI discussion driving efficiencies driving that clean data, helping those workers actually spend time on really, really valuable all the same theory.

Kevin Rosenquist: Yeah. Yeah, yeah. Well let’s yeah, let’s,talk about procurement automation, because I know a lot of our listeners have dealt with that mundane stuff that I was just talking about. And I know, I know, I have, you know, approvals, purchase orders, follow ups, invoices, matching everything. It’s just for lack of a better term, it’s kind of a pain in the ass, you know? So like, talk about how parasoft I’m okay with that. Can you talk a little bit about how Parasoft automates the aspects of procurement? Sure.

Matt Cotter: So there I would say that we’re really good. We’re not good at everything. The thing that we’re really quite good at, there are two parts to it. One is the shopping experience. Right. So if you’re buying direct materials, which you’ve probably done right, you’re looking for approved vendors under certain contract terms, at certain pricing at the right time, etc., presenting you with all of that data in a useful shopping experience, managing punch out Catalogs. Et cetera. Et cetera. That’s why that’s one of the parts that we do really well. The other part that we do really well is the workflow around the right positioning. So now you want to buy something. Who does it go to? Go from there to there to there to there. There. That whole workflow, intelligently managing that workflow is functionally what we do really well. If you were to pull back from the functional piece, what we I would contend that we do better than anybody else in the market today is deeply, deeply, deeply integrate with the ERPs and the host systems that we sit on top of. Everybody’s going to say that they integrate, and it all comes down to matters of degree. we I again, I would contend humbly that that is our that’s why we win new customers is our level of depth of integration with us, which allows us to do all sorts of things clean data, present data, push things through workflows that other people can’t do it inside the interface of the ERP, there’s just a lot that we can bring to the table specifically around that. Them.

Kevin Rosenquist: Yeah, it was interesting to me too, as I was kind of going through how you guys do everything. I mean, basically, is it safe to say that once the item is picked by, by the, the buyer and then it goes into the automated process, they don’t really have to do a whole lot after that day.

Matt Cotter: It again, they don’t see it again until really it shows up. Um, so it’s incredible. Uh, so it is. Yeah. And that is, again, that is a benefit of that deep integration. Like when it’s surface level integration, I need to kind of continually interact with that thing, whatever it is that I decided to purchase. And that really becomes powerful. I think when you think about verticalization in different industries from buying pencils. Right. I’m saving some time. That’s important. Right? I don’t want to lose that. I don’t want to miss that. We offer a lot of value in those. If I’m buying syringes, it’s a different, different level of impact on the human condition. Right. And like those are the areas that we really try to lean into is where can we, um, lean into particular vertical expertise, specifically around procurement, content procurement, those types of things where we can add some value and then.

Kevin Rosenquist: That kind of leads to account payable automation, which is that kind of is essentially almost totally automated when you have it built into the procurement side too, right? Yeah. Yeah.

Matt Cotter: And that’s interesting that I think in the short to medium term is really where a lot of the AI comes in as well. So if you think about now I’ve gone through that whole procurement process that we just talked about. Right. I’ve selected that relevant content, be it vertical, be it horizontal, doesn’t matter. Comes into the workflow deeply integrated into that ERP. Now I’ve gotten likely in the US in particular that it is a PDF paper like Keith scrawled on something somewhere. Right. That’s what that looks like. How do I work with that piece of data, in whatever format that has come in, and minimize the amount of human touches while maximizing the accuracy? That’s where we play. Like that’s where we play to date. Like there has been. You know, if you think about how companies deal with that, traditionally it’s been people, Keith, get the invoice, looks at it, types in the information. Right? And he’s usually pretty correct. He’s usually pretty correct. Second evolution of that is OCR, which to me is still the predominant one that has the most impact today. On if you’re going to do it right on your 80% to the invoice comes in 80% of the time that OCR is going to be able to crank it out. It’s awesome. And then there’s the 20, right. And the 20 is Keith decided to scrawl his Social Security number on the back of an invoice and send it in. And now I’ve got to deal with how do I deploy technology to handle the edge cases? Right. So one of the things that we have done with a pilot group of customers in the last month or so is to pilot using AI to do automatic geocoding. So I’ve got the invoice, I can see the vendor, I can see what I purchased. I’m going to put it, post it to the right geocode without human interaction, trying to find those edge cases of functionality where you can continue to push on automation. That’s to me a really exciting part about the AP invoice.

Kevin Rosenquist: But yeah, it’s pretty it’s it’s it’s incredible when you think about that process, because anyone who’s been involved in that before knows how many people are involved and how many steps are involved, and how much keystrokes there are at eyeballs and thought and all that. So, I mean, the thought of like having just so few touch points, I mean, I can’t imagine any accounts payable department would be down on that.

Matt Cotter: No. And I mean, there are reasonable objections that we would deal with with every new customer when it comes into it. Right. Um, and it’s the same kind of thing that you would see with any again, uh, seismic introduction of new technology, right. Can it be as good as a human right? Those are things that you’re going to hear all the time. And they’re just, again, natural reactions to, to technology playing a role, uh, that people used to.

Kevin Rosenquist: And the answer really is that a lot of times it can be better because there’s no human error.

Matt Cotter: I would contend, as much as I am not a fan of the Waymo driverless taxi, that in most instances when you were dealing with mechanical things, computational things, etc. computers can be faster and better. Um, now what I find really interesting though, is how does that change the role of the worker and how does it change the role of the individual? So I’ll give you an example in our development environment. Right. So a third of our employees in India are doing product development. The role is changing pretty dramatically and pretty quickly right. The role changes from your skills around SQL code or Python or Java or whatever your role becomes. How much more effectively can you interrogate the AI? I can write the code. I don’t need somebody to write code. Right. That is now something that the computer can do itself. What I need is someone who can very intelligently ask the question of the engine to get it to write the right thing. Dramatically different skill set. But that’s where our world is going to go. Like that’s where my manufacturing environment, right? My dev environment, that’s where it’s going to go is how effectively can I interact with the thing? Ap is going to be the same issue, right? So I bring this stuff in. How effectively can I interact with that system? Can I ask it the right questions? Can I formulate it and push it into the right way, into the right workflow, into the right part of the GL, all those kind of that the skill set is not going to be, you know, this the skill set is going to be how do I use my brain to force this thing to type faster.

Kevin Rosenquist: Yeah yeah yeah yeah. It’s interesting because I remember when generative AI first kind of became a big buzz term. You know, I was working in marketing and a lot of people were worried about it. You know, they were like, well, this is going to take our jobs. It’s going to do this. It’s going to do that. And certainly it didn’t. It’s not completely false. It did to some degree, especially from freelance writers for blog posts, you know, things like that. That changed things quite a bit. But it always feels like, you know, like you brought up the automobile thing and, you know, the Industrial revolution and like, you know, where people are like, oh, well, all this automation, all these automated factories, everyone’s going to be out of work. And it’s like, well, no, we just we kind of adjust and we figure out a way to make it work for us.

Matt Cotter: The work changes, and I think that that is the big thing is if if we and I, you know, put myself in that boat, right. If I don’t get comfortable with driverless taxis, I’m going to be doing a lot of walking around San Francisco. Yeah, like next ten years. So the work, the way you interact with the technology changes and modifies. It’s not that it’s going to put everybody out of work, it’s that the work that we’re doing is going to change. Right. The roles.

Kevin Rosenquist: Will change.

Matt Cotter: And I think the other part that’s tough for people, kind of writ large, is that ship has sailed. Yeah. But like that that ship has sailed. It’s done. Like you, if you want to have a philosophical argument about the perils thereof. Great. We can do that all day long. Right? Let me go get some coffee. We can sit and chat all day long, right?

Kevin Rosenquist: Might need something stronger for that conversation.

Matt Cotter: Exactly. It’s not going to change anything. Yeah. Right. Yeah. I’ve heard people talk about regulation. I’ve heard people talk about like it’s done. That genie is out, not going back. And so the issue becomes again in my little slice of the world. Professionally, how can I use it most effectively to help the customer base that we have? Knowing that those jobs are going to change definitively, they’re going to change. How do we help use these types of things to help us? Do you get do.

Kevin Rosenquist: You get concerned or caught up with some of the ethics involved in AI production or an AI as it moves forward?

Matt Cotter: Yes, I do very much less from like specifically again in my functional slice of the world. Right. Like, I don’t I’m not overly worried about the the bots becoming sentinent in a deeply integrated into Microsoft GP. Maybe I should be, but like that doesn’t keep me up at night. I do get concerned about it. I think I’m more of a macro level. again, about whether you are in a position to be super excited about it or super nervous about it. It is disruptive. It will be disruptive, right? There is no like again, that ship has sailed. Genie out. Come up with a good cliche for me. Like that’s done. I do think, and I do spend a lot of time thinking about like, what is the role that we play in using that technology, but using it in a way that is good for our users, that is good for our customers. Again, when you think about areas that we play very strongly and I played very strongly in regional healthcare, not for profit, higher ed, right. These are industries where disruptive disruption can be incredibly positive, like incredibly positive right. And the impacts to the human condition can be incredibly positive. Right. Incredibly positive. And if I screw it up the best case scenario is massive missed opportunity. That’s the best case scenario. There is a worst case scenario right. But that’s the best case scenario. If I screw it up is massive missed opportunity. And so yeah that that that very much plays on very much plays on my mind. 

Kevin Rosenquist: You’ve been in many different leadership positions. Executive vice president.

Matt Cotter: You just called me old by the way. But that’s cool.

Kevin Rosenquist: I wasn’t saying that. You said it, not me.

Matt Cotter: No, no, no, I think you’re very experienced. I think that you.

Kevin Rosenquist: Had an impressive career.

Matt Cotter: Well done, well done. Good recovery. Good recovery.

Kevin Rosenquist: Yes. How do you approach leadership in 2024, especially with, you know, the, you know, corporate culture changing in recent years, the shift to remote or hybrid work. How do you approach leadership?

Matt Cotter: Yeah, it’s an interesting question. and like joking aside, I do think that’s where me being old helped.  I am I’m kind of less concerned with the world writ large when it comes to that. Like I have 250, 260 employees. I think it’s 262 at this point. My my concern is them. Like those those individuals. And am I creating an environment that is, you know, I call it appropriately competitive. We talk a lot internally about like nobody here’s an indentured servant. Like if you feel like you have a better opportunity to make your life better for your family, like, what are you doing here? Do it. Yeah. Go.

Kevin Rosenquist: That’s a great way to be.

Matt Cotter: Yeah. Yeah. Go. And we’ll help you, because at some point I’m going to recruit you back. I remember I had two years. Three years ago, I had a conversation with someone who is in our product management, and I was like, go, I need like, go. You need to go do your thing. Because in two years after you gain some other experiences, I’m going to call you and you’re coming home. And he runs product management for us. so I think, I think if I am effective at parts of leadership, it comes from I think probably my employees would say like a level of authenticity.it’s kind of what you see is what you get. way too old to be playing games. Like, you just don’t have that kind of energy. Don’t have that kind of brain space to do it. So it’s kind of what you see is what you get.  leadership, I would say, gets a lot easier when you surround yourself with two way person, people that you respect, people that are smarter than you, people that you like, people that argue with you. All of a sudden when you do that, you start to look like a pretty good leader, right? Like, I got all these people around me who are incredibly intelligent. They work really hard. They care very deeply. They’re good people to be around. They’re good human beings, like, they’re just good human beings. You do that, you surround yourself with that. And all of a sudden people are like, you know, that guy’s a really good leader. No, that guy is just not an idiot. Like, that’s it. Like that’s the baseline. You’re not an idiot. He surrounded himself with super smart people. So, um, I think it just comes from authenticity. And maybe the the other one. That would be like availability. Yeah. I think a lot of leadership is showing up, like being there for people when they’re.

Kevin Rosenquist: That’s a good, simple simple. But yeah.

Matt Cotter: I mean not thought.

Kevin Rosenquist: About or not talked about enough.

Matt Cotter: When they’re feeling down you’re there like you’re you’re there like when they’re feeling up, right. You’re there and you’re celebrating the wins and you know, all that kind of wonderful stuff. I think that’s a lot of it is just being there for people. I don’t know, there’s a bunch of other like, I’m sure people would say much smarter things than I could, but those are the two to me. I think that’s great, though.

Kevin Rosenquist: I think that’s really great. Who inspires you?

Matt Cotter: Oh, God, who inspires me? It’s going to sound cliche. You know, my dad? Definitely. My mom. Definitely.my family writ large. My wife, incredibly much like she is this woman who is, like, incredibly intelligent, and somehow more so emotionally intelligent than, you know, kind of traditionally intelligent. And this is a woman who has, you know, patent lawyer, like, she got some game, like she got some game, um, and still is so connected to the community and to the individuals in the community. So like that is, that is alternately, uh, inspiring and daunting, would be the best way to say that,  inspiring and daunting. You know, my dad is no drama. Like, just no drama. Never too high, never too low. Come on, come away. Like, my mom is probably one of the more intellectually curious people that I know. Like, she was a librarian. She was an English teacher. She was a history teacher for 40 years. She taught me creative writing. And then she decided to teach herself how to paint. And now she sells paintings, you know, all over. All over the region. So, like, it’s just incredible. So I mean, those are the crisp, easy ones that come. I would say there are all sorts of individuals where I’ve stolen stuff from. So if that is a method of inspiration that I have just thieved dramatically.

Kevin Rosenquist: It can be, why not? That’s up to you.

Matt Cotter: Yeah, exactly. You know, um, plagiarism.  it’s the highest form of flattery. That’s, uh. I know this is going to sound ridiculously cliché, so I fully stipulate that.

Kevin Rosenquist: Okay. All right. Noted. the.

Matt Cotter: Employees that we have, but specifically, here’s what I mean by that. So when I took this job, the first thing I did was like, the new CEO guy gig, right? I went around and interviewed a bunch of employees. Tell me what type of company you want to work at. One of the things that came back almost uniformly, that was this concept of advocacy, which is we want to be able to advocate for ourselves. We want to advocate for our customers. We want to advocate for our for our teammates, but we want to advocate for our employer or for our community. And so then they devised this whole system where we’ve leaned into that. So we’ll do a culture champion on a monthly basis. And the prize that you get is we donate on behalf, on your behalf to a local charity, somebody that that you choose, because this is something they have chosen that is important to them, that impacts their communities. We give people time off and they take it to do the most amazing things. This guy named Jignesh Shah,  in India, he would go around Ahmedabad, the city of 10 million people, and collect school supplies and then drive them 4 or 5 hours out into the country and donate. The way that we found this out, by the way, is he was in the paper, never asked for a day off, never asked for a minute of time, never asked for a minute of support. All of a sudden somebody is like, is that you, Ben? Hey, we know him.

Matt Cotter: What is he doing? And so now we’re, like, fully in behind this. Once a year, I get this whole write up and it talks about all the kids that he’s supported and stuff. And I’m like, absolutely. Like, here’s all my here’s all my everything. Like, go for it. And what’s wild about this kind of motley crew of employees is they’ve kind of collected each other around this. And so now they’ll recruit people and they’ll recruit people that are like them and they’ll find other people. And so now we’ve got this whole thing. I’ve got Tammy Bauer spent some time working at a women’s shelter, and we’ve got other people who like, I’m calling somebody. I’m like, yeah, he’s on PTL. He’s like, oh, cool. I don’t know, he’s in the middle of Africa. Like, these are real stories about these employees. Like, this is what they choose to do with their time and their money and their resources and their effort and their brainpower and yeah, like that. It’s pretty hard to not get fired up on, you know, a weekday morning when you might be dragging a little bit. Right. And you get an email from Jignesh and he’s like, hey, thanks for the donation. Here are pictures. You’re like, oh, well, screw it. I guess I’m running through that wall today. Mhm. Right. That stuff happens here a lot and it’s really cool. Super cool. It’s it’s it’s not a bad way to spend a workday. Yeah. Yeah exactly. Not exactly punching the third shift in the mind.

Kevin Rosenquist: Yeah. Right. Right. I like that. When I asked you that question, though, you didn’t. You didn’t give me a business leader. You didn’t give me a famous president. You didn’t give me I like that. I mean, you went you, the people around you, the people close to you are the ones who inspire you. And that is probably why you’re able to lead the way you do. 100%.

Matt Cotter: Yeah, 100%. Now. I mean, I love a good quote from John Wooden as much as the next guy. Sure. Right. and there’s a lot of stuff like that that you can take to heart. And I spin back to people all the time. Absolutely. Those are pithy, right? And those are glib, and they’re really easy. And those are, like, timeless for a reason. Um, I guess I like the nuance. Yeah. For sure.

Kevin Rosenquist: For sure. Well Matt, thanks for being here so much. Really appreciate what you talking about.

Matt Cotter: 

Kevin Rosenquist: Anytime parasoft and all the automation and stuff. It’s really exciting to see where things are going to go. And, uh, and yeah, we’d love to. We’ll have to have you on again, because I’m sure AI is gonna be totally different in about six months because it’s change.

Matt Cotter: Is fast and six months. It’s too central here right now. Give it till eight and it’ll be different.

Kevin Rosenquist: We could do a whole new interview at that time. Exactly.

Matt Cotter: Thanks, man. I appreciate.

Kevin Rosenquist: It. Thanks for being here, Matt. Really appreciate your time.