Top Accounting Platforms for Startups

At an early-stage startup, hectic days are the norm. Between talking to investors, hiring new talent, acquiring new customers, and making your existing customers happy, you’re spending every second hustling—which means you don’t have the time or energy to manually take care of your company’s financial nuts and bolts.

That’s where a good accounting tool comes in. Whether it’s software, a service or a combo thereof, making a good decision about your accounting tool will help you easily meet your accounting priorities:
paying your employees
  • Invoicing clients
  • Tracking business expenses
  • Managing your bills
  • Keeping track of your cash flow
  • Ensure your financial statements are in synch with your business model and goals (you shouldn’t need an MBA or a CPA to do this!)

What’s right for your business? Below we review the most popular tools among startups. Many earlier stage companies prefer a pure software solution like Quickbooks, Xero or Wave and other growing startups often move on to software + service combos like Bench, BackOps or InDinero. Then there are other solutions like Expensify, FreshBooks and that offer rich platforms but specialize in accounting-related matters like expenses, time tracking and invoicing. You can find all of the tools that startups for accounting here!

To help you make this decision, We’ve rounded up the six most widely-used options, along with the features that make each unique.

Key Criteria
While every tool has its own pros and cons, there are a few universal things we looked for when compiling this list.
  1. Scaleability: If all goes well, your startup is going to get a lot bigger. You need software that’ll go with you from customer number 50 to customer number 5,000.
  2. Simplicity: This software should make your life easier—spending hours trying to figure out how to accomplish a minor task or change a setting defeats the purpose.
  3. Flexibility: During their beginning stages, some companies change their business models. With an adaptable tool, you won’t need to change software every time you adapt or pivot.

QuickBooks: The Classic
With more than two-thirds of Stacklist companies using QuickBooks whether directly or via an accountant, there’s no doubt this option is the most popular choice.

Once you sign up for a 30-day trial and log in, you’ll start to understand its popularity. The dashboard is refreshingly simple and easy to navigate—not only are all the options clearly labeled, but everything is well-organized and there’s plenty of white space.

QuickBooks syncs with your bank, so all of your transactions are automatically pulled in and categorized. Logging expenses is also easy; you and your employees can simply snap pictures of your receipts with your phones, upload them, and let QuickBooks handle the rest.

When it comes time to bill your clients, the app lets you create white-brand invoices. Since QuickBooks also integrates with PayPal, Square, Stripe, and more, receiving and processing payment is a breeze.

Dasher CEO Jesse Boyes sums it up: “It's just good at taking care of something we don’t want to deal with.”

Xero: Modern Software that's Easy on the Wallet
With pricing plans starting at $9 a month, Xero is a solid option for startups on a budget. Like most online accounting options, it comes with features for invoicing and sending estimates, sending payments, paying your employees, and logging transactions.

As Dan Belhassen, president and founder of SmarterU points out, Xero has “some features that set it apart: It has multi-currency support, it’s extremely easy to use ...and it has a fantastic ecosystem with even more advanced tools within the system.”

Xero also shines when it comes to sorting imported transactions. Most of the time, reconciling your bank statements should be effortless—since the app connects with your bank, each line in your statement is brought in and turned into a transaction automatically. However, if you want to do anything more complex (say, label 20 freelancer payments as “Freelance”), Xero’s cash coding feature lets you quickly highlight and mass-label them. You can even create custom user rules, so every freelance payment is labeled appropriately going forward.

FreshBooks: Nailing it on Invoicing & Time-Tracking
It’s easy to underbill when you and your employees are merely estimating how long client-related tasks are taking you. With FreshBooks, you can be confident you’re not unknowingly leaving money on the table, because this accounting platform comes with a time-tracking feature. Open the web app, or use the iOS or Android companion app to log your time. Every billed hour will automatically be converted to an invoice line; unbilled time can be manually added as well.

“We use FreshBooks for invoicing, and we think they’ve really nailed it in this area,” says Robert Peck, co-founder and CEO -of Commonwealth Joe.

Of course, invoicing and time-tracking aren’t FreshBooks’ only features. It comes with a handy list of reports, including aging and time-to-pay. When you’re trying to balance your books, seeing which customers need to pay up is helpful. Plus, you can see when recipients opened your invoices, add late fees, schedule recurring payments, and send payment reminders.

Intacct: For Big Startups Getting Bigger
Since Intacct is primarily designed for enterprise, it might be a good fit if you’re in the growth stage. Of the 2% of Stacklist startups that use Intacct, they’ve all got between 50 and 250 employees.

Intacct has an API that lets us stream data from our system directly to Intacct, which is crucial for us since we have unbelievably complex data,” explains Justworks Founder and CEO Isaac Oates. “We were on QuickBooks before, and it was fine, but we wanted to switch to a system we knew we could go public on, and we felt Intacct was that system.”

It handles accounts payable and receivable (meaning you can both pay and get paid through the system), purchasing, and cash management. Intacct’s Collaborate social layer is also worth mentioning; this feature lets your sales, services, and finances teams talk to each other without leaving the app. The customizable dashboard and reports will give you a high-level view of your financials, a granular view, and everything in between.

Bench: For Growing Startups who Need More than Software
If you choose Bench as your accounting service, you’ll get access to accounting software plus an actual bookkeeper.

“We use Bench for accounting, and it’s pretty good,” Derek Skaletsky, founder and CEO of Knowtify. “It’s definitely more of a service than a software though.”

According to Skaletsky, Bench’s only downside is that they’re “pretty expensive,” although as he notes, still cheaper than hiring someone.

Your team will prepare and maintain your financial accounts, manage the books, review and categorize transactions, perform month and year end reconciliations, and handle tax preparation and filing.

All you have to do? Connect your bank account to Bench and send them pictures of your receipts. If you’re too busy for the latter, you can even send them your receipts in an envelope.
“Bench is awesome,” says Ajay Yadav, founder and CEO of Roomi. “The accountant does all the hard work for you!”

Expensify: The #1 Expense Management App
More than 5% of Stacklist startups rely on Expensify. Unlike the other tools on this list, it’s not built to be a comprehensive accounting tool. Instead, it focuses on expense reporting.

Imagine you’ve asked your social media manager to buy a Hootsuite Pro account. He uses his personal credit card (because you haven’t given out corporate ones), sends the transaction to Expensify, where you approve it. Thanks to the platform’s ACH Direct Deposit, PayPal, and payroll connections, he’s easily reimbursed. The whole process takes less than five minutes.

Approving cash transactions is also speedy for both you and your employees; they log in to Expensify and add the details, you click “yes,” and boom, they’re paid.

The app also works with mileage, time, and other quantifiable expenses. Once you’re ready to generate expense reports, use Expensify’s no-fuss reporting features.

An Accountant: Because Sometimes a Person Beats a Platform
You can always opt for the traditional option: an accounting professional. That’s what 20% of Stacklist founders have done.

While hiring a third party to manage your financials will cost you in the short term, it can pay enormous dividends over the years. After all, even with accounting software, you’re probably incorrectly categorizing some expenses, unintentionally racking up late fees, or sending the same payments twice. (None of these mistakes are hard to make when you’re super busy.) A bookkeeper will help you avoid these costly errors and keep your books clean.

An accountant, meanwhile, can give you expert, unbiased advice on your financial situation. He or she can also generate key financial reports and help you get capital.

Once you’ve chosen the optimal accounting option for your business, you can get back to your main focus: making your startup grow. That’s not to say you’ll stop worrying about money—we both know that’s never going to happen. But at least you’ll have the comfort of knowing your employees will get their paychecks, the lights will stay on, and come tax season, you’ll be in good shape.

-Aja Frost