The Top 5 Accounting Software for Startups: Keep Your Brand on Track in 2025

Apart from additional functionality, the key difference best accounting for startups among plans is the number of clients you can serve (invoices and estimates are unlimited to your collection of clients). All plans accept ACH payments, and there’s an app store with lots of integration options. The Early plan has some limitations, allowing just 20 invoices (or quotes) per month and five bills. However, these limits may be acceptable for service-based or part-time businesses.

• You can also create an estimate and convert it to a project once approved.
• We talk to hundreds of startups a month – and about 10% of them don’t need a monthly accountant.
• The components of accounting software for startups typically include modules for invoicing, expense tracking, payroll management, and financial reporting.
• Features include invoicing, expense tracking, project time tracking, and inventory management.

I learned this the hard way when I first set up my business and ended up getting hit with a rather annoying fine. We include the average user review score for each software collected from large third-party websites dedicated to the collection of user reviews, such as Software Advice, SourceForge, and G2. Before subscribing, you can access all of Xero’s features for free for 30 days to help you decide which plan best suits your needs.

TIME IS RUNNING OUT TO BUILD YOUR DREAM ECOMMERCE BUSINESS IN 2025!

Xero’s cloud-based accounting software does what you would expect, like record transitions, calculate tax, and track both inventory and financial data. Plus, you can easily integrate with Gusto Payroll for an additional fee. When it comes to expenses, most small businesses are overwhelmed by the amount of information they need to keep track of. It’s easy to end up duplicating your receipts, and manually entering your payments and other data causes even more confusion and frustration. FreshBooks business accounting software eliminates these problems instantly. You also get a free 30-day trial to try the software, which means no financial risk for you.

Re-outsourcing your financials: Is it right for your startup?

Continue reading our full review of the best accounting solutions below. You’ll find additional information about each software, including cost, accessibility, and more. By the end of our comparison, you’ll be able to choose which one is right for your venture. Bookkeeping involves tracking financial records such as income, deductions, credits, and expenses on a weekly or monthly basis. When selecting a plan, consider the size of your startup, the specific features you require, and how the software can scale with your business growth.

Additionally, Zoho’s accounting software offers a variety of tax features to ensure your business stays tax-compliant. Instabooks offers free startup accounting software to automate bookkeeping and provide real-time financial insights. Its advanced free features help new businesses manage their finances without incurring additional costs.

The online version gives you access from anywhere, plus you get access to the faster loading Android and iOS mobile apps. Manual accounting requires inputting all financial transactions into a spreadsheet or tracking method. This is not recommended for businesses with more than a few expense or income statements to document. LessAccounting is a straightforward accounting software for startups, offering essential financial tools with a minimalistic and user-friendly interface. Zoho Books also offers a free version of its accounting software, but in the form of a free trial rather than a free subscription.

If you are looking for a startup accountant, look for a provider who knows your particular business model, as different types of early-stage companies have accounting particularities. Read our explanation of how to pick the best accounting software for startups. Remember, VC-backed companies have different needs than traditional small businesses or solo entrepreneurs. The value of having someone who understands your complete financial situation really can’t be overstated.

Here are answers to some frequently asked questions I’ve received about accounting software for startups. Here are some trends I’ve noticed for accounting software for startups, plus what they might mean for the future. I sourced countless product updates, press releases, and release logs to tease out the most important insights. Features include monthly accounting services, system design and implementation, fractional CFO services, transaction readiness, monthly HR services, strategic HR initiatives, and payroll services. Sage for Accountants is a specialized accounting software, providing comprehensive client management and compliance tools.

Learn how we stay transparent, read our review methodology, and tell us about any tools we missed. For just $1, you’ll unlock instant access to over 30+ expert-led courses and 1,000+ lessons designed to help you scale your business. Plus, you’ll become part of a thriving community of ambitious founders just like you. But a fine is just one of the issues that can come from not paying taxes correctly or on time. In the worst case scenarios, you could end up with much more serious issues, potentially even jail time. As a business owner, you may be asking yourself, ‘Do I really need to pay taxes when I haven’t even sold any products yet?

More than just accounting, Oracle NetSuite is an integrated, cloud-based ERP that helps businesses manage complicated financials across multiple locations. Some users complain about the lack of advanced features for larger companies or complex accounting operations. Sage stands out for its ease of use, robust reporting, and real-time financial insights. It simplifies decision-making with customizable reports, seamless integrations, and responsive customer support.

What is the best small business accounting app?

It’s ideal for solo entrepreneurs who are looking for a platform that suits their accounting needs while also having the capabilities to scale up as their business grows. QuickBooks Online is generally easy to use because of its intuitive and customizable dashboard. However, we docked points for ease of setup because it may take time to create a company file. I am committed to delivering expertise-led answers to your small business questions by using my first-hand experience and testing platforms or services when able.

The firm offers bookkeeping and accounting services for business and personal needs, as well as ERP consulting and audit assistance. Good bookkeeping provides entrepreneurs and small business owners with detailed, accurate, timely records that assist decision-making, taxes, and audits. It’s an essential part of good business management and business growth.

For high-growth startups, especially ones that expect to raise venture capital, management needs access to high quality financial statements. Investopedia collected and analyzed over 200 key data points from eight leading accounting software providers to evaluate the most important factors for readers choosing accounting software for small businesses. We used this data to review each company based on cost, scalability, reputation, accounting features, and other factors.

Whereas a traditional small business focuses on their bank account balance, startups focus on the KPIs that help them raise their next round of funding. Choose an advisor who “gets” early-stage, Silicon Valley-style businesses. So we don’t recommend that level of complexity for your seed stage model – just the IS and the cash position (maybe working capital or inventory). This is when you take your financial model or projections and compare them every month to your actual results. For example, you compare your accounting numbers versus your projection numbers.