Financial tech tools are often put on the backburner compared to technology for marketing or operations. However, financial innovation has created massive opportunities for founders who want greater efficiency and improved visibility in their companies.
New software comes out every day, and your company needs to proactively seek out the best tech to avoid losing out to competitors.
Though your financial professionals will handle many of your company’s tools, founders can also use them to make their lives easier and improve business efficiency.
This article will discuss which tools you should be familiar with, why they matter to founders and how they can add value to your startup.
Let’s get started.
1. Accounting Software: Xero, QuickBooks
There’s no reason for any startup in the modern world to be doing their accounting on paper. Cloud accounting software has become too affordable, too easy to use and too helpful to pass up.
It can automatically record your transactions, help you perform bank reconciliations online and seamlessly extrapolate your data to create real-time financial statements – all for prices as low as $9 a month.
Tools like Xero or QuickBooks can save you and your bookkeeper hours each month and are easily worth the cost.
Additionally, accounting software often serves as the centerpiece for your entire financial system. Other tools can sync up to your accounting software and seamlessly pull your financial data to perform their functions.
Using one of the leading services allows you to link your accounts to many of the other tools on this list, like Bill.com.
2. Bill Paying and Invoicing: Bill.com
Every startup is concerned with cash flow, and in the early days of a startup, that responsibility often falls squarely on the founder’s shoulders.
Bill.com is another useful tool that can help you automate and manage both your Accounts Payable and Accounts Receivable functions.
- Accounts Payable: Bill.com automatically inputs your invoice data and monitors for duplicate invoices or unusually large transfers. You can even set up a custom approval flow so that payments are processed more quickly and confirmed by the proper management.
- Accounts Receivable: Perhaps even more importantly, you can use this tool to streamline your collections process. There’s a lot to do between booking revenue and banking your cash and anything you can do to speed that process up is going to help your business’s profitability.
3. Payment Processing: Stripe
Cash and checks are becoming increasingly outdated, especially now that the coronavirus has encouraged online business models. More and more companies are relying on online methods to collect revenues and make their payments.
Stripe is one of the most popular online payment processors and has four “products” that can help your business transfer funds in and out more efficiently:
- Payments: Software that allows you to accept payments online, customize your checkout experience and manage online invoices.
- Terminal: Even though brick-and-mortar businesses are going through difficult times, some business models have no choice but to rely on their in-person checkout systems. This product allows you to combine your online and offline sales processes.
- Connect: A set of tools that allow your company to build a marketplace, incorporate payment systems into your website and easily distribute funds to your sellers.
- Billing: A product that allows your business to create recurring invoices and ongoing subscriptions. It’s especially useful for SaaS startups that charge customers a monthly fee.
4. Expense Tracking: Expensify
Whether you’re looking to simplify your employees’ reimbursements or prepare your documentation for future audits, expense tracking technology is invaluable.
Expensify is a powerful tool that can help you automate every step of the expense reporting process, including:
- Receipt documentation: Expensify can help you do away with the folder full of receipts forever, whether it was hard-copy or on your computer desktop. Just take a picture of your receipt and the software can create and store an expense report automatically.
- Reimbursement approval: One common area of friction for employees is the delay between business expenses and subsequent reimbursement. Expensify can separate any expenses that need a manager’s review, automatically approve the rest and deposit reimbursement funds into your employee’s accounts within 24 hours.
- Accuracy and compliance checks: Expensify can automatically check your receipts for any expenses that seem unusual or risky. You’ll be able to weed out non-deductible expenses, detect any duplicates and ensure your books are ready for an audit.
5. Financial Dashboards: Jirav, Spotlight
Cash flow management, growth forecasting and financial planning aren’t just the purview of your CFO and accounting staff. Startup founders have a vested interest in their company’s financial strategy too.
You need to be able to monitor your company’s financial data quickly and easily to help you make those important business decisions.
Financial planning software helps founders consolidate their operational information and analyze it in a visually digestible format.
Jirav and Spotlight can both help you to:
- Forecast business trends: Founders need to intimately understand the rate at which their company is growing, the challenges they’re going to face and the impact their decisions will have on their financials.
- Customize historical reports: These tools can create customizable spreadsheets that are far more intuitive and shareable than old-fashioned Excel documents. You can use them to compare budgets, automate your monthly reports and quickly study your financial data.
- Create insightful financial dashboards: Business leaders are busy people, and startup founders are no exception. These tools can help you quickly study the big picture and visualize your company’s metrics in an understandable and customizable way.
6. Payroll Management: Gusto
Startups rely heavily on their employees to drive their business forward. After all, employees are the ones who provide the services, develop the software and support the customers.
That makes attracting, managing and retaining the best talent a top priority for startup founders. There are a lot of costs (in both time and money) that go into hiring and paying your staff.
Technology that can help you streamline these functions goes a long way towards adding value to your business and making your life easier.
Gusto is a powerful tool that can help you with:
- Managing payroll and benefits: Staying compliant with payroll regulations can be frustrating even for an experienced business leader. This tool can help you file your payroll taxes automatically, get free health benefits administration and seamlessly offer retirement savings plans for your staff.
- Tracking hours: Understanding how employee hours are being spent is always useful for management. Gusto can help you seamlessly track the hours spent on a task, approve requests for time off and sync both with payroll.
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Hiring and onboarding employees: Your startup should implement process automation wherever possible, and the hiring and onboarding processes are perfectly suited for it. Gusto can help you create offer letter templates, sign and store their documents online and quickly set new hires up with the software they need.
Stay on the Lookout for New Developments
A founder’s responsibilities often shift over the life of a startup, but you should never stop looking for the easy and big wins that will help your company succeed.
Searching out the latest and greatest technology to incorporate into your business functions is one of the best ways to add value, no matter what stage of growth your company is in. These six tools are a great place to start and will help you make many of your startup’s processes more efficient.
But technology is developing every day, so make sure you stay on the lookout for new tools. There’s always room for improved tech that could boost your bottom line and give you an advantage over your competitors.
