Why Your Startup Needs Online Accounting Software
We've heard it before - an entrepreneur in the early stages has to wear many hats....
Marketing, sales, business development and accounting are just a few of the tasks that need to be dealt with on an ongoing basis. Then there's the actual work! The early days can be a struggle.
There are lots of software out there that can assist entrepreneurs and startups with automating and streamlining these tasks and whether you can use them depends on your business processes. That being said, the one tool every startup can benefit from is online accounting software.
Accounting Isn't As Difficult As You Think
Whether you have experience with some accounting or don't, online accounting tools make it easy to reconcile your books, providing you with up-to-date and reliable information, so that you know how your startup is performing.
In the past, accounting software had to be used by experienced bookkeepers and/or accountants. Presently, online accounting software is made for the end-user. With some training, entrepreneurs will be on their way and will find the user-interfaces very intuitive.
The most popular online accounting tools download your business bank and credit card transactions automatically. All you have to do is categorize them to the appropriate expense and income categories (i.e. advertising, office supplies, rent, etc.). This eliminates data entry almost completely and allows you to really automate and streamline the accounting side of your business. The faster you address your downloaded transactions, the faster you will have beautifully laid our reports providing you with valuable information.
Cloud accounting allows you to keep track of your expenses and be on top of them. This is especially important in the early days since expenses may be the only transactions you have.
Users And Access From Anywhere
As an entrepreneur, you may have partners or even investors. Most online accounting software systems will allow you to add your investors as users, so that they can keep track of the company's performance. In addition to this, you and your partners may have different roles in the company related to accounting: one of you may generate invoices while the other does the bookkeeping over expenses. Adding users provides flexibility and since online accounting systems are web-based, users can log in from anywhere with an internet access to either view the numbers or work with the numbers.
When it's time to finally invoice and collect some money for all your hard work, online accounting software allows you to generate professional looking invoices, send it directly to clients from the accounting system and even get paid. Many of the popular online accounting tools integrate with Stripe, PayPal and other payment engines; allowing you to receive payment sooner.
If you invoice from your accounting system starting day one, you'll have an organized log of all invoices (from your first invoice to the most current one), all in sequential order. It's a great way to see your progress and keep a listing of all your revenue and contacts in one place.
Automate, Streamline And Go Paperless
The most popular online accounting systems understand that business owners have limited time to deal with their accounting process. For this reason, new features are always being added, resulting in significant time savings. Here are just a few of our favourite features:
> Repeating Invoices (automatically generated recurring invoices sent to customers immediately) > Build rules around common and recurring transactions so that the bookkeeping is completed on its own > Integrate third-party apps and snap photos of receipts/bills - and get rid of paper!
Make Better Decisions And Final Thoughts
The above is just a summary of why a startup should move their accounting system online. Ideally, you can combine your move with finding an online accountant, who is well versed with all of these tools. As a whole, there are lots of other benefits to be had with moving to the cloud but you'll only start noticing them when your pain starts disappearing. But the overriding benefit is access to reliable and up-to-date information. This is important because it provides you with the ability to understand how your business is performing, and more importantly, allows you to make faster and smarter business decisions.
For a listing of popular online accounting systems, look here.