Starting a new business can be tricky; you need to either handle multiple operational aspects yourself or build an expert team quickly to help manage your business. One of the things you must get right is accounting and bookkeeping resources. Although it may be tempting to save money by doing the bookkeeping yourself – or hiring an inexperienced bookkeeper, it carries a much bigger risk for your business. As we step into 2023, the role of accounting software for startups has never been more crucial.
Relying solely on an experienced bookkeeper is not enough in today’s dynamic business world, where online transactions and real-time updates have become the norm. Therefore, it is always advisable to invest in accounting software for startups to ensure you have the necessary infrastructure and resources to support your new business’s accounting operations.
Here are ten of the best accounting software for startups for you to consider before selecting the right one for your business:
- QuickBooks Online: Best for overall accounting management
- Zoho Books: Best mobile accounting app
- Xero: Best affordable accounting software if you don’t need external support
- Melio: Best for managing accounts payable for small businesses and startups
- Wave: Best free software to support unlimited users
- Sage 50cloud: Best software for startup accounting tools
- NetSuite ERP: Best for streamlining end-to-end accounting and bookkeeping processes
- FreshBooks: Best accounting software for small service-based startups
- Trolley: Best for automating global payments
- Rossum: Best for document-based accounting
Comparing the Top Accounting Software for Startups
Although almost every startup accounting software will have some similarities when it comes to basic accounting features, there can be some key differences in advanced functionalities and tools that set them apart. Here are some of the comparable features of top startup accounting software to help you choose the one best suited for you:
| Accounting Software | Monthly Price | Inventory Tracking | Assisted Bookkeeping Support | Mobile App |
| QuickBooks Online | $30 – $200 | ✔️ | ✔️ | ✔️ |
| Zoho Books | $12 – $65 | ✔️ | NA | ✔️ |
| Xero | $12 – $65 | ✔️ | NA | ✔️ |
| Melio | Free | NA | NA | NA |
| Wave | Free | NA | ✔️ | ✔️ |
| Sage 50cloud | $50.58 – $197.55 | ✔️ | NA | ✔️ |
| NetSuite ERP | Custom Pricing | ✔️ | NA | ✔️ |
| FreshBooks | $17 – $55 | NA | NA | ✔️ |
| Trolley | $49 – $199 | NA | NA | NA |
| Rossum | Custom Pricing | NA | NA | ✔️ |
Top 10 Accounting Software for Startups in 2023
Startups today have a vast range of accounting software for small businesses to choose from, which often makes it difficult to make the best accounting software for your startup. Let us explore the top ten accounting software for startups – their pricing structure, plans, pros, and cons – to simplify that decision.
QuickBooks Online
Overview
QuickBooks Online is one of the best software solutions available for overall accounting operations management, with features like banking and cash management, custom invoice management, and access to extensive financial reports.
It also has a robust mobile app for managing all your accounting functions on the go. Additionally, you can also access QuickBooks’ assisted bookkeeping service QuickBooks Live for expert bookkeeping support. And with extensive integration and add-on options, QuickBooks is one of the best user-friendly, customizable, and scalable accounting software for startups.
Pros & Cons
pros
- Efficient bank reconciliation feature
- Track income and expenses based on project, location, or class
- Powerful inventory management tools
- Powerful mobile app
cons
- More expensive than counterparts
- No telephone customer service
- Comparing estimated and actual project costs not possible
- Limited number of users with each plan
Plans and Pricing
QuickBooks Online offers four pricing plans:
- Simple Start: $30 per month to support one user
- Essentials: $55 per month to support up to three users
- Plus: $85 per month to support up to five users
- Advanced: $200 per month to support up to 25 users
New subscribers also have the option to choose between a 30-day free trial or 50% off for three months as they sign up.
Zoho Books
Overview
Offering the best mobile app experience, Zoho Books offers you features like making and sending custom invoices, inventory management, and project accounting. It also offers you access to powerful analytics and reporting capabilities, along with an extensive selection of financial and accounting reporting templates.
Pros & Cons
pros
- Affordable alternative to most accounting software
- Competitive free plan
- Access to phone and live-chat support with all plans
- Strong mobile app
cons
- Lacks fixed-assets tracking feature
- Tracking and managing unpaid bills requires a higher-tiered plan subscription
- Inventory management and project tracking features available only in higher-tiered plans
- Limited number of invoices with lower plans
Plans and Pricing
Zoho Books has a six-tiered pricing structure:
- Free: Supports one user and one accountant for businesses with annual revenue up to $50,000
- Standard: $20 per month to support up to three users
- Professional: $50 per month to support up to five users
- Premium: $70 per month to support up to ten users
- Elite: $150 per month to support up to ten users plus access to advanced inventory management tools
- Ultimate: $275 per month to support up to 25 users plus access to advanced inventory management and analytics tools
You also have the option to add additional users to these plans at $3 per user per month. Additionally, you can also access discounted rates if you make annual payments.
Xero
Overview
Xero is one of the most affordable startup accounting software for businesses that do not need external accounting support. Its standout features include a fixed asset manager, project accounting and inventory management tools, accounts payable management, and access to financial reporting ranging from basic to specialized reports. However, with limited external support, scaling Xero to an ERP may be challenging as your business needs evolve.
Pros & Cons
pros
- Every plan supports unlimited users
- Strong inventory tracking and management features
- Automatic depreciation expenses calculations for fixed assets
- Easy to understand and use bank reconciliation feature
cons
- Limited customer support
- No annual billing option
- Limited mobile app features
- Cannot add multiple organizations to the same plan
Plans and Pricing
Xero has three pricing plans:
- Early: $12 per month to manage up to 20 invoices and five bills
- Growing: $34 per month to manage unlimited invoices and bills
- Established: $65 per month to manage unlimited invoices and bills, plus access to project accounting tools
Melio
Overview
Melio is one of the best options for managing the accounts payable operations of a small business or a startup. It also allows you to set up flexible payment options with free payment processing (except credit card transactions). Features like billing and invoicing management, approval process control tools, check processing, fraud detection features, and duplicate payment alerts make Melio stand out from the competitors.
Although it does not have a native mobile app, it is highly mobile optimized. You can use this cloud-hosted solution on mobile. Lastly, multiple customer support access channels (email, phone, live chat, training, and tickets) and seamless QuickBooks integration make Melio one of the leading candidates for startup accounting software. As per TrustPilot, Melio has a rating of 4.4 out of 5.
Pros & Cons
pros
- Free ACH payment processing
- Fraud detection features
- Seamless integration with QuickBooks
- Multiple customer support access channels
cons
- Only available to small businesses in the US
- No mobile app
Plans and Pricing
Melio is available for free. The platform also allows you to make free bank transfers and debit card payments. Melio charges 2.9% per credit card transaction.
Wave
Overview
Wave is the best choice for you if you want support for unlimited users for free. You can easily manage your accounts payable processes and invoices while recording sales and income tax. Additionally, you also get access to extensive financial reporting features and Wave ProAdvisors – for assisted bookkeeping services. Wave is a better choice for startups in the organizational stage; however, you are likely to outgrow its features and need to upgrade to a more powerful accounting solution as your business grows.
Pros & Cons
pros
- Easy setup and easy to use
- Supports unlimited users and companies
- Free access to accounting, receipt scanning, and invoicing features
- Access to a range of financial reports
cons
- Inadequate customer support
- Cannot classify income and expenses by location or class
- Two separate mobile apps with limited functionality
- Cannot reconcile bank statements with time differences
Plans and Pricing
Wave offers four plans:
- Accounting, Invoicing, and Receipt Scanning: Free
- Credit Card Processing: 2.9% + 60 cents per transaction (excluding American Express cards); 3.4% + 60 cents per transaction (for American Express)
- Bank Payments: 1% per transaction
- Wave Advisors: Starting at $149 per month
Sage 50cloud
Overview
Sage 50cloud is a web-based accounting solution best suited for SMEs and startups looking for a comprehensive accounting and bookkeeping solution. Its hybrid deployment mode, along with a robust mobile app, makes it accessible and allows you to manage your accounting options on a PC, via a web portal, or on mobile devices.
It offers a comprehensive range of features like billing and invoicing management, budgeting, bank reconciliation, financial consolidation, and forecasting. This, along with order tracking and management, supplier management, purchasing, and receipt management tools, makes Sage 50cloud one of the best standalone accounting software.
In addition, a range of add-on features and easy third-party integration makes Sage 50cloud highly flexible, customizable, and easy to scale as your startup’s needs evolve and grow.
Pros & Cons
pros
- Easy to use and customizable platform with an intuitive UI
- Mobile app for accounting management on the go
- Flexible and scalable to meet evolving startup needs
- Add-on inventory and stock management features
cons
- Expensive than comparable alternatives
- Limited customer support access channels
- Complex interface
- Deep learning curve for users with no accounting background
Plans and Pricing
Sage 50cloud offers three pricing plans:
- Pro Accounting: $50.58 per month
- Premium Accounting: $78.21 per month
- Quantum Accounting: $197.55 per month
You also have the option to get a free trial before purchasing Sage 50cloud.
NetSuite ERP
Overview
NetSuite ERP is the best solution for startups that want to automate and streamline their end-to-end bookkeeping and accounting processes – including invoice management, payment processing, tax management, and real-time financial visibility. Startups can benefit from a customizable dynamic ledger to ensure the accuracy of your financial records and reporting compliance.
NetSuite ERP also offers add-on modules for payroll and human resource management, making it holistic accounting software for startups. And you have total control over the tools you want to subscribe to, allowing you a level of control over the money you need to invest.
Pros & Cons
pros
- Customizable dynamic general ledger
- Process automation to streamline end-to-end accounting and bookkeeping management
- Advanced vendor management and inventory control tools
- Real-time financial visibility
cons
- No free trial
- No transparent pricing
- Limited basic customer support (extra cost for extensive support access)
- Cannot customize financial reports easily
Plans and Pricing
NetSuite ERP offers quote-based custom pricing plans.
FreshBooks
Overview
If you are a small service-based startup, FreshBooks may be the best accounting software for you. It offers you access to extensive invoice management, project accounting, and financial reporting tools to meet the needs of any small business. Additionally, a mobile app comparable to its desktop countertop and excellent customer support makes FreshBooks stand out from the competitors.
You can use it easily without accounting knowledge or experience; however, it is more suitable for sole proprietors or small businesses. You will likely outgrow FreshBooks’ features as your business grows, and it will quickly become expensive if you want to add more billable clients.
Pros & Cons
pros
- Easy integration with Gusto – at an additional fee – for payroll management
- All plans support unlimited invoices
- Effective time tracking tools for billing hourly rates
- Mobile app for on-the-go accounting
cons
- $10 per month per user fee for additional users
- No automatic COGS calculations
- Live connection necessary to track and reconcile bank accounts
- Cannot track income and expenses by class
Plans and Pricing
FreshBooks offer four pricing plans:
- Lite: $17 per month to support up to five billable clients
- Plus: $30 per month to support up to 50 billable clients
- Premium: $55 per month to support unlimited billable clients
- Select: Custom pricing to support unlimited billable clients with access to a dedicated account manager for your business
All plans have the option to add users for $10 per month per user.
Trolley
Overview
Trolley is best suited for startups that manage global payments while ensuring compliance with tax and reporting. Key standout features of Trolley include payments in over 200 countries, real-time payout monitoring, automated mass payouts, foreign exchange tracking, tax reporting, and tax mitigation. In addition, you also get access to bookkeeping features and reporting capabilities necessary for startups.
You also don’t have to worry about data security with bank-level security features like 256-bit encryption, built-in fraud detection, two-factor authentication, and bank account validation. Trolley also offers you easy third-party integration options to customize the platform for your startup needs.
Pros & Cons
pros
- Supports global payments (in over 200 countries)
- Bank-level security features
- Easy reporting and tax compliance
- Seamless third-party integration for customization
cons
- No mobile app
- International payments may take time
Plans and Pricing
Trolley offers three pricing plans:
- Grow Plan: $49 per month
- Platform Plan: $199 per month
- Enterprise Plan: Custom pricing
You also have the option to avail free trial before making the purchase.
Rossum
Overview
Rossum is a document-based bookkeeping solution ideal for startups dealing with paper receipts, invoices, or purchase orders. It offers cognitive data capture features to easily scan, collect, and validate data from different types of documents into a single curated transaction feed. Additionally, its AI and ML solutions also allow you to set up an automatic system to determine the confidence scores of documents. Rossum’s other standout features include data matching, analytics tools, audit trails, and document curation, while its mobile app allows you to capture data on the go. And its add-on features and easy third-party integration options allow you to customize and scale Rossum as your business evolves and grows.
Pros & Cons
pros
- Unified document management
- Cognitive data capture
- Automated end-to-end communication
- Easy to set up and use
- Seamless third-party integration
cons
- Cannot track business expenses from unstructured documents
- May face language restrictions
- Setup may be challenging without a technology background
- Pricing information not available to the public
Plans and Pricing
Rossum offers quote-based custom pricing. You also have the option to avail a free trial before making your purchase decision.
Our Methodology for Selecting the Best Accounting Software for Startups
We have compiled the list of top ten startup accounting software after evaluating a range of accounting software that have features useful for startups. In addition to evaluating the general accounting features, we have also considered factors people usually take for granted – like access to customer support or easy access to financial reports.
Lastly, we have also considered affordability, scalability, and ease of use to identify ten of the best accounting software for startups.
Conclusion
Although many startups go through a trial-and-error phase, having the right accounting software from the get-go is critical to set up your business to succeed. You need to consider the industry you will be operating in, its unique accounting needs, and your business’s accounting and compliance needs before selecting the accounting software that gives you access to the necessary tools and reports.
Also, keep in mind the scalability of the accounting solution and the flexibility it can afford you as your business grows and evolves.
Frequently Asked Questions
Is QuickBooks good for startups?
QuickBooks’s ease of use, multiple add-ons and third-party integration options, and scalability make it good accounting software for growing startups.
