Whether it’s creating a new product, disrupting an industry, or serving a particular customer base, most business owners excel at what they do best. However, when it comes to managing finances, even the most capable entrepreneurs can feel overwhelmed. For many, partnering with an outsourced accounting firm makes sense, allowing founders to focus their energy on activities that drive the most value for their business. Yet, whether you’re working with an outsourced firm or managing your finances on your own, having the right combination of tools can simplify processes, save time, and set your business up for long-term success. Let’s explore the key components of an ideal accounting tech stack and how they can transform your approach to managing finances.
Accounting System: The Core of Your Tech Stack
A reliable accounting system is the backbone of your financial operations. For startups, QuickBooks Online (QBO) and Xero are top choices.
These cloud-based platforms are cost-effective, user-friendly, and scalable, making them ideal for growing businesses. Their strength lies in their app ecosystems, offering integrations with a wide range of external tools for enhanced reporting, inventory management, accounts payable, and more. With QBO and Xero, you can create a flexible system that evolves with your business and simplifies financial management. While there are other, more affordable options, they often lack robust reporting capabilities and don’t scale as effectively with growing companies.
Payroll: Ensuring Accuracy, Compliance, and Scalability
A reliable payroll solution is essential for managing employee compensation and staying compliant with regulatory requirements. A good payroll system automates tax calculations, processes direct deposits, files government remittances, and offers strong customer support (because you will need help at some point).
For Canadian payroll, we normally recommend Wagepoint, Humi, Rippling, or Ceridian/Dayforce:
- Wagepoint is a user-friendly and cost-effective solution for small-to-medium sized teams with direct integration with QBO and Xero.
- Humi provides a combined payroll and HR platform, which is particularly valuable for startups looking to manage employee benefits and compliance in one place.
- Rippling offers far more than payroll integration. It serves as a comprehensive workforce management system, combining payroll, HR, IT, and benefits administration into a single platform. Rippling also integrates with QBO and Xero.
- Ceridian/Dayforce scales effectively for larger teams and manages the entire employee lifecycle but does not directly integrate with QBO or Xero.
For US payroll, we normally recommend Startups utilize Gusto, Rippling, or Ceridian. Gusto and Rippling both integrate with QBO and Xero.
For global payroll needs, Deel and Remote are excellent options, especially for startups managing international employees or contractors, as it simplifies compliance with local regulations, helps manage payments, and benefits.
Accounts Payable: Stay on Top of Vendor Payments
Managing accounts payable is essential for maintaining strong vendor relationships, ensuring smooth business operations, and effectively managing cash flow. Tools like Dext, Float, and Plooto simplify the process of organizing, approving, and paying vendor invoices efficiently.
Dext automates the categorization of bills and receipts, reducing manual data entry and integrating seamlessly with QBO and Xero for streamlined payments. We find Dext particularly valuable for businesses with a large volume of bills and receipts, as its highly accurate data capture tool can save hours of data entry each week.
Similar to Dext, Float and Plooto also capture and categorize bills and receipts, but they go beyond categorization by connecting directly to your bank to process vendor payments. These tools save time and reduce costs by eliminating the need to log in to your bank manually. Both also include robust approval workflows to ensure proper oversight.
Expense Reporting: Simplify Tracking and Reimbursement
Managing expenses often starts with spreadsheets and email, which can be manageable early on but quickly becomes cumbersome as you scale. Tools like Expensify, Float, and Rippling make expense management seamless.
- Expensify automates receipt scanning and categorization and makes receipt upload easy with its user-friendly mobile app. It also integrates with QBO and Xero.
- Float combines corporate cards with real-time expense tracking and employee expense submission, approval, and payout.
- Rippling integrates expense management with payroll and HR, enabling quick submission, approval, and reimbursement all in one platform.
Each tool offers unique features, so choosing the right one depends on whether you need standalone expense tracking, corporate card management, or an all-in-one solution.
Corporate Credit Cards: Control and Flexibility
Corporate credit cards are essential for startups to manage spending effectively while maintaining control. Traditionally, small businesses in Canada have relied on bank-issued corporate credit cards as their primary option. However, an increasing number of companies are turning to Float for their corporate credit card needs. Float stands out by offering both virtual and physical cards with customizable spending limits and real-time tracking. These features give businesses greater oversight, streamline expense management, and reduce the risk of overspending.
Billing: Streamlining Revenue Collection
Efficient billing is critical for startups to maintain healthy cash flow and provide a smooth customer experience. Tools like Stripe, Chargebee, Maxio, Maple billing, and QBO offer flexible solutions to handle a variety of billing needs.
Stripe is ideal for payment processing with customizable APIs, making it perfect for businesses with unique billing workflows. Chargebee and Maxio excel in managing subscription-based models, offering automated invoicing, advanced reporting, revenue recognition, KPI tracking, and advanced customer management features. Maple Billing is well-suited for handling complex billing structures and contains many of the features available in Chargebee and Maxio. QBO simplifies invoicing and recurring billing for startups with straightforward needs.
Most early-stage companies start with QBO and Stripe for simplicity, but as billing complexity increases, solutions like Chargebee or Maxio are excellent choices.
Optimize your Startup’s Financial Efficiency with the Right Accounting Tools
A well-integrated accounting tech stack is the foundation of efficient financial management for any startup. By leveraging the right tools you can streamline operations, save valuable time, and focus on scaling your business.
At BrightIron, we specialize in helping startups like yours implement and optimize the ideal accounting tech stack. Whether you need guidance on selecting the right tools or support in managing your financial operations, our experienced team is here to ensure your business runs smoothly and stays investor-ready.
Ready to simplify your finances and set your startup up for success? Contact BrightIron today to get started.