Top 10 Finance Tools for Your Startup
Updated: Nov 11, 2021
In order to run your startups Accounting & Finance department well, you'll need a competent workforce, and a robust set of technology. Over the last decade, there has been a tremendous emergence of finance tools, making it easier than ever to scale your Accounting & Finance department effectively, and with ease.
My first and favorite tool is Brex. Brex is an incredible platform where you can create credit cards on the fly, be it virtual cards or physical cards.
What I love is that you can create new cards for your team members, set whatever limit you want, and then easily destroy those cards.
Brex works by taking 20% of your bank balance and assigning that as your credit limit. Managing spend across your company has never been easier.
The next most common tool, even more common than Brex and probably the most popular finance tool out there, is QuickBooks.
Here, I would like to distinguish that this is QuickBooks online and not the desktop version. There happens to be a large divide between QuickBooks desktop and QuickBooks online.
The older generation likes QuickBooks desktop. My theory being that they have not gotten used to all the great functionality of QuickBooks online, but that is a different discussion.
A few of my favorite features are the bulk reclassification tool available for accountant users. You could also bulk import invoices, which I am a huge fan of. AP is simple, bank reconciliations are simple. For any financial reporting that you need, you can just click on reports and download directly from their hub. QuickBooks online is used by 99% of our clients. It's the easiest accounting software out there.
Other accounting software worth mentioning are Xero and NetSuite.
Xero is similar in size to QuickBooks online. I find that a lot more of our Canadian clients use Xero.
NetSuite is the most powerful accounting software out of the three. They are good when it comes to inventory management, multi-currency, and multiple entities having to deal with consolidation at the same time. Note that the price of Netsuite can be up to 10 times the price of QuickBooks online or Xero, so usually I see startups in much later stages who have one of those needs like multi-currency options or a heavy need for inventory management using NetSuite.
Bill.com is one of my favorite platforms, and they make it extremely easy for you to do several things.
First, you can take an invoice directly from your inbox and forward it to an email that will upload to their platform and sync with your accounting software.
What I love is that once it goes into Bill.com’s platform via their smart technology, they can auto categorize what the bill is, who it is from, or what the amount is. All that information will sync to your accounting software via an API.
You can even set up approvals where you can say who in the company this bill should go to, allowing that approver to log in, and approve the bill for release.
Other similar platforms which are gaining popularity are Airbase, Corpay, and Tipalti.
Microsoft Excel is a tool which I can guarantee you every finance department uses. I want to go one step further though and mention Microsoft SharePoint.
What I love about using Microsoft SharePoint is that first all your changes sync directly live online to the cloud, so you never have to worry about accidentally losing your work. The main benefit is that you could collaborate with multiple people using the Microsoft native Excel application. Google sheets is great at this, but they only do it with the online editor, and at the end of the day, there are just a lot of limitations once your file gets a past a certain size, as well as keyboard shortcuts and other stuff. If you have not used Microsoft SharePoint, I highly suggest that you check it out.
When it comes to expense and reimbursements, Expensify is the leader. They make it extremely easy to upload just your receipts, which will automatically create a report.
Like bill.com, this tool has excellent approval features too. Whenever you are moving cash within the company, you could assign the expense reports directly to an approver. Once they approve, you could also make a payment directly on their platform, and it also syncs directly with your accounting software.
Now we are probably biased on this one, but Mighty Digits can totally help your startup scale. We specialize and love working with early-stage startups, providing our proprietary app that can generate a beautiful budget for you in Excel, making it amazingly easy to do board reporting.
We also do bookkeeping, we pay your vendors, process payroll.. it is all a one solution stop for a fraction of the price of what you would pay for a full-time employee.
When it comes to cap table management and 409A valuations, there is only one leader in the space and its Carta.
Carta is great, especially whenever you start to raise more and more capital, as you can invite your investors directly. This is a platform that almost all law firms are familiar with, and it really is just the de facto service when it comes to cap table and 409A management.
Payroll is a big part of your startups Accounting and finance Department, and the way I see it, there really are three leaders in the space: Gusto, Justworks and Rippling.
Gusto is great, and they are probably the most commonly used payroll provider out of all of our startups. The only real limitation of Gusto is that they are not a PEO of like Justworks and Rippling.
PEO is a Professional Employer Organization. The way it works is you actually become an employee of their organization. All of your employees become an employee of their organization, and it makes it really easy them for them to bundle health benefits directly in their platform, as opposed to you having to do that separately.
Rippling is something that not too long ago actually came about and is really gaining a lot of popularity with the startups that we work with.
One of the most common things that I see with SaaS companies is they find it incredibly difficult to manage all the movements in their MRR and ARR because they are using a spreadsheet and that is the exact problem that SaaS Optics solves.
They make it easy to manage every single one of your contracts, and understand not only what your ARR and MRR is every month, but they also provide all sorts of other great metrics.
They make it easy for you to book your deferred revenue schedules, which is super useful for investor reporting.
Those are my favorite Finance tools to help run your Startup's Accounting & Finance department. Did I miss any? I'd love hear your thoughts!
Hey - thanks for checking us out. We LOVE crunching numbers and providing peace of mind for your startup by managing your Accounting & Finance needs. We crunch your numbers so that you can focus on what matters the most - growing your business.