Posted by: @spdlm | 28 Mar 11

Bookkeeping for Start-ups

Chances are, the small group of people who are the founders of a start-up will not include a qualified accountant. Even if there is an accountant amongst you, you will need a software that will do a good job keeping the books of the start-up. While the requirements of start-ups vary, I went on a search and trial mission to find just the right one for us. I hope you might find it useful.

The Basics

While there are quite a few applications out there, this is the basic list of qualities I needed for our start-up, not in order of importance:

  1. Must be SaaS/Could application (see other blogs – this is the only way!)
  2. Must be easily scalable (because we are very optimistic!)
  3. Fantastic UI (I hate book-keeping as it is – I need some motivation)
  4. Multi-currency (we are Global company – oh yes!)
  5. Does all the “usual stuff” (Invoicing, expenses, tax, reporting, multiple users)
  6. Cost effective

Then there were other “nice to have”s to look for:

  1. Reconcile Bank Accounts (preferably automatically)
  2. Reconcile Paypal Account (preferably automatically)
  3. Reconcile Google Checkout

The list wasn’t that long after filtering my Google search. This was my test list:

  • LessAccounting
  • FreshBooks
  • Zoho Books
  • Kashflow
  • Xero

Their cheapest package priced at $30 but with a very short 7 day trial period, it was very easy to walk away from this site. They also did not have a product demo video/screencast, which is very important these days. I must get a feel of the UI when choosing a software which I can not easily change at a later date. Although the prospect of having a real book-keeper for $100 a month was enticing, we are in a SaaS business where most of the transactions are automated and we are UK-based, which means a book-keeper knowledgeable in US practices wasn’t much help. Needless to say, I didn’t even open a trial account.

I found this company listed in Google Marketplace. The add-on features they offer is quite impressive. Out of the list of 5 software, this was one of the only 2 that offers the integration with PayPal as well as Google Checkout. For some reason, their pricing structure is a little strange, where a small business like us will need to subscribe to the top of the range “Mighty Oak” plan only because I want to have more than one user using this account. Really, I could do with, bamboo or cherry tree, not quite Mighty Oak, priced at $39.95/mth. Lack of screencast or video also put me off as I couldn’t really feel the UI once inside. The landing site is pleasant enough but I wanted more.

I liked the promised feature-set and remembered the buzz a little while ago and didn’t spend much time before signing up for the trial account. Reasonably priced too, at $24/mth. Account opening was easy and I have full features for limited period. This is probably the only positive things I can say about Zoho I think. Once inside, I am reminded of a typical legacy accounting software, with very rigid navigation system, not intuitive at all. While there are “boxes” to put your numbers etc, nothing is automated. I spent a frustrating 15 minutes trying to import my bank accounts, PayPal account and Google Checkout account but I failed. When I click “Support”, all I get is an online form to submit a query. No online forum or support archive. I felt quite misled by their adverts and profiles. Pretty bad.

This was one of my favourite. It does most of the things I need it to do, except perhaps Google Checkout. UK-based company and apparently I can submit my annual returns through them. Nice video and reasonably priced (£15.00/mth) for comprehensive feature list. A little cumbersome log-in process as they have an extra step requiring “memorable word” every time I need to log in. The very instructive video raised my expectations but alas, once I am inside, it is an icon jungle! On the Settings page, I counted 34 icons! Ok, they were nice and large, but still 34! Every page you navigate to, you are met with a lot of words. It just doesn’t flow. I also couldn’t figure out how to change the currency for each invoice item either. Even with all these problems, it is the best of all the systems I have tested so far.

Last but not the least, Xero. What a triumph! This has won my half day long Accounting App for SME competition hands down. I managed to reconcile 5 accounts, upload and reconcile all invoices in matter of a few hours. Very intuitive to use. Although they can’t reconcile Google Checkout, their PayPal integration works well. Ironically, our bank is not supported for automated reconciliation, but I think that is the same with all the other systems mentioned so far. Not the cheapest but not overly expensive at £24/mth for the “Large” package. For their usability, intuitiveness and well written help files, I would recommend this feature packed accounting must-have. Well done to xero team.


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