The story of Tarkvara Financials

After the collapse of Soviet Union, I was one of the first to start IT company. 

Even got representative rights from Microsoft to all Baltic States in 1990. Somehow I liked Bill Gates business strategy on those days. 

However, since 1993 we where credible providers of business IT solutions and used innovative technologies, like client-server, SQL, 4GL development tools, standardized development processes, etc. So, obviously I had no interest anymore selling Microsoft Windows to business computers anymore. 

During that period Sweden managers where looking good and low cost developers from Estonia, so it was viable for anyone with some programming skills to work for them. 

So, one of the project from a person related to our company and using same technologies was to develop innovative accounting solution, that will address complexity of general ledgers in Sweden public management and their corporations. 

This was how “objects” where introduced instead of “cost codes” extensions to account numbers. 

We called this “multidimensional general ledger”. 

However, because the guy programming skills had problems getting working code and he wasn’t able to finish that product for customer, that project got my interest. 

Especially I loved how he had tried to implement flexible accounting reports instead having “built in” balance and income statements as other account programs had on those days. 

So, we got some first customers interested about this solution and after using our product some period, none of those accountants ever considered to use competitive accounting programs anymore. 

And our solutions was in use over a decade by some major businesses and organizations without any problems or issues with it. To our surprise, one of our early customer, after six years of using it in the business that had increased a lot, just complained, that reporting is now very slow as they had millions of accounting records in their database. 

So, we had to implement “archiving” functionality to sort out the performance issues, which we never considered to happen in beginning as the lifetime of a software product was estimated to be 2-3 years on those days. 

To complete our product offering, we added budgeting, financial risk analysis and (loan payment schedules , return of investments, cash-flow predictions, etc) modules for CFOs to use. 

However, I messed totally in product marketing as I used term “creative accounting”. But “creative accounting” had meaning that some manager was looking an accountant willing to hide management mistakes and the “criminal activities” as common practices on those early days of Estonian Capitalism. As honest Christian I never wasn’t aware about those trends in our society. 

Even s.c. CFOs never had understandings of complexity of financial world. Somebody just having good contacts with a bank just got his position after negotiating more cash from bank to spend! 

Therefore, after our pilot customers, such kind of innovative product just didn’t find it’s place. 

Other accounting software providers soon figured out to use “objects” as well, but it took more that twenty years for Navision/Microsoft to copy exactly our financial report generator to their product offering now. 

The irony of the story is, that in 2000-2001 being in US, somebody organized me the meeting with Navision management. My product introduction went well as they where shocked that during my 40 minutes presentation our software never crashed or didn’t had any problems. But they just told me “we can see what you have done, but this isn’t what our customers are asking from us”.