Ultimate Guide to accounting software used by top startups

As more expenses occur, there are an increasing number of receipts to manage and expenses to process, which can be difficult if your team is doing this manually. Quality automation software scans each receipt and extracts the data using optical character recognition (OCR) technology, ensuring the receipt is properly categorized and stored. Since the software can require a receipt with every transaction, you can be sure that every expense has the documentation it needs. Although it doesn’t provide a mobile app, Patriot’s 100% cloud-based accounting platform enhances accessibility. Odoo topples other accounting software for startups for its holistic approach, covering not only accounting but also other business aspects. It is ideal for organizations seeking an integrated solution that unifies financial processes with broader operational functionalities.

What is the best small business accounting app?

Phoenix Strategy Group advises enabling FreshBooks’ auto-billing feature for retainer clients right after setup. This approach helps maintain consistent cash flow, especially for startups gearing up for their first funding round. Media Suite, a Toronto-based development agency, used FreshBooks’ automated billing to recover $15,000 in missed hosting invoices.

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• You pay based on your monthly expenses, and come tax time, you’re ready to pass them off to your accountant.
• Basically, it’s a list of all of the places where you might want financial transactions to be recorded.
• Accounting software does more than just track your expenses—it automates critical financial tasks, reducing human error and freeing you up to focus on scaling your business.
• In general, we prefer QuickBooks due to their easy to use software and great customer support.
• Consider using QuickBooks Live, which pairs you with a dedicated team of certified bookkeepers who manage your financial records and offer expert support.

Your accounting software should integrate seamlessly with the tools you already use—such as payment processors, CRM platforms, and banking systems—to reduce friction in your workflows. But what if the software you’re considering doesn’t support a critical integration? In that case, check if it offers APIs or third-party connectors like Zapier, which can help bridge the gap. Otherwise, a lack of integration with essential tools could be a red flag, leading to more manual work and data silos.

• Choosing the right accounting software is a critical decision for startups, with long-term implications for financial management, operational efficiency, and scalability.
• Link your bank accounts, customize your categories, and ensure your reporting templates align with your goals.
• This comparison highlights the importance of balancing affordability with the ability to scale effectively.
• Rather than simply processing transactions, accountants can focus on strategic analysis and business partnership roles that complement automated processes.
• Our team is trained to look for specific errors based on your company’s stage.

When does a funded startup need to start worrying about doing bookkeeping?

They can also make sure you follow accounting standards so you can prevent costly mistakes down the road. A professional bookkeeper, equipped with robust accounting software, can streamline these AP responsibilities, ensuring timely payments, accurate recordkeeping, https://jt.org/accounting-services-for-startups-enhance-your-financial-operations/ and fostering positive vendor relationships. Cash flow is the lifeblood of your business, so keep an eye on how much money is coming in versus going out so you can plan ahead. Unexpected expenses happen, and staying on top of your finances helps you avoid running into cash shortages. We strongly encourage lightly funded startups to do their bookkeeping themselves – it’s not that hard, at least when you are small and have very few transactions.

• But, low quality bookkeepers are trying to get the transactions into QuickBooks as quickly as possible to save time, and they don’t really care if they’re labeled or if they’re in the right categories.
• These tools form the foundation of PSG’s financial services, streamlining essential processes.
• Among the many tasks are documenting income, expenses, sales, and purchases systematically and accurately.
• FreshBooks offers four premium plans with monthly fees starting at just $15 per month.
• You want a firm that provides a dedicated accountant for consistency and clear communication, rather than a rotating cast of advisors.
• Implementation costs typically range from $25,000 to $75,000, depending on the complexity of your data.

• Sage Intacct and NetSuite excel in providing detailed tax automation, while Phoenix Strategy Group simplifies revenue and expense reconciliation for added convenience.
• For instance, a startup with a subscription model may assess customer attrition data in order to improve marketing efforts.
• Bonus points if it lets you customize reports and track KPIs like burn rate and runway.
• With its focus on simplicity and collaboration, it’s perfect for small teams working in dynamic environments.
• You’ll find additional information about each software, including cost, accessibility, and more.

Missing invoices, poorly tracked expenses, and lack of documentation often create serious problems when raising funds or preparing for audits. In this guide, we’ll explore the Top 10 Best Accounting Software for Startups in 2025, comparing their features, pricing, and suitability for different types of startups. Whether you’re bootstrapping or scaling fast, you’ll find a tool that helps manage your finances with confidence. Our professional, experienced accounting professionals have helped hundreds of startups grow and prosper — and we’re standing by and ready to help yours as well. accounting services for startups Contact us today to schedule a free consultation and download a complimentary financial model template in the meantime to get started.

A fractional CFO is a part-time, external CFO who can offer your startup high-level financial expertise at a fraction of the cost of what it would be to hire a full-time CFO in-house. Common duties include fundraising, scaling for growth, navigating tax structures, financial forecasting, budgeting and creating financial models. Getting your accounting and bookkeeping in order from the start will save you time, stress, and potential financial headaches down the road. Here’s a step-by-step guide to setting up and managing your startup’s finances.

Tax Forms and Supporting Documents

Additionally, all plans currently offer 50% off for the first three months, lowering the Essentials plan to $32.50 per month during this period. As a startup founder, data protection should be a top priority—whether it’s safeguarding customer information, internal documents, or proprietary code. Password managers and cybersecurity tools help minimize security risks and ensure compliance. The best way to increase efficiency is to reduce repetitive tasks through automation. Integration platforms connect different tools in your tech stack, creating seamless workflows that free your team for more meaningful work.