We highly recommend looking for accounting software with the deepest integrations, as you'll ultimately save both time and money.
When to set up accounting
When it comes to the rest of your back-office setup, they all go together in the stack: Accounting Software, AR/AP Software, Expense Management Software, Payroll & HR Software, Benefits Provider, and Bookkeeping Service. There are a ton of providers here and some integrate better than others and some not at all.
What is accounting
All of the nitty gritty finances of your business need to be recorded and your best options will be the ones that work with the most other software with the deepest integrations which will save you time and money on accounting.
Whether you've started or not, make sure to save everything. Documents that include income, expenses, deductions, and credits. These can be on receipts, bank or credit cart statements, bills, cancelled checks, invoices, proof of payments, financial statements, previous tax returns, W2 and 1099 forms, or any documents that have to do with your business.
Which accounting software
There are many good options that range from cheap to insanely expensive. Quickbooks and Xero are very similar products, with price between $30-150/ month depending on the package. We find Quickbooks to have the best integrations to other software which save you time and reduce error.
Once you grow and have several subsidiaries, lots of complicated allocations, or multiple currencies, we recommend Sage Intact or NetSuite as your step-up choice. These more complex softwares cost +$20k a year and are built to upgrade from quickbooks as your entry level accounting program.
Pro-Tip: If you set yourself up with a bookkeeping service, such as pilot, they will set up the necessary softwares and integrate them together for you- saving a ton of headache.
This is the most standard and safe pick of all startup accounting software. It's almost necessary for payroll processing and integrated merchant processing. Additionally, almost every bank integrates with it and most accounts use it. You can't go wrong.
Xero performs all the same functions as quickbooks, but has some different features. For example, Xero doesn't automatically add late fees but it sends payment reminders. It's a little simpler to use, so if you're doing your own accounting, this could be a better option.
If you haven't raised a Series A, then read no further. This is for the soon to be unicorns. For example, Brex started on Quickbooks but quickly moved to Netsuite because of its robust accounting approval flows critical for the types of financial control and IT audits it regularly completes.