The 5 best accounting software and tools for startups in December 2024

When selecting accounting software for your startup, five critical factors can impact your decision:

Cost-effectiveness

How much will that tool really cost you? Look beyond the sticker price and evaluate the total cost of ownership as well as return on investment (ROI). Consider tiered pricing plans, potential add-on fees, and the value you're getting for your money. A cheaper option might cost more in the long run if it lacks essential features or scalability.

User-friendliness

Accounting software for startups should simplify financial processes, not further complicate them. Your accounting team needs software with an intuitive interface that requires minimal training. Clear navigation and logical workflows reduce errors and save time. Remember, the best software is the one your team will actually use.

Customization options

Customization options allow you to tailor the software to your unique business needs. Look for flexibility in creating custom fields, reports, and workflows. This adaptability ensures the software works for you, not the other way around.

Scalability

As your startup grows, your accounting needs will too. Your chosen startup accounting software should easily handle increased transaction volumes and complexity as your business expands. It should offer features like global adaptability and multi-currency support that might not be necessary now but will become vital as you scale.

Integration capabilities

Your accounting software should play well with other tools in your tech stack, such as CRMs, e-commerce platforms, and payroll tools. Native integrations reduce manual data entry, minimize errors, and provide a more comprehensive view of your financial health.

By prioritizing these features, you'll set yourself up for success. The right accounting software won't just meet your current needs—it'll make your team more efficient and support your startup's growth journey.

1. Brex

Brex’s spend management software combines expense management, startup banking, and startup business credit cards with powerful accounting tools. Designed to make accounting easy for startups through enterprises, Brex's accounting features integrate with numerous other financial products, providing a comprehensive accounting software for startups.

Key features:

• Automatic expense categorization and receipt matching
• Real-time spend tracking with customizable budgets and alerts
• Customizable approval workflows with multi-level approvals
• Detailed financial reporting with custom tag support

Pros:

• Automated expense management and accounting in one platform
• More than 1,000 software integrations to manage your startup with ease
• No personal guarantee required for credit products
• Tailored rewards program for startups

Cons:

• May not be suitable for businesses with complex accounting needs

Pricing:

Brex pricing offers three plans that are customizable to fit your business:

• Essentials ($0 user/month): for startups and growing companies
• Premium ($12 user/month): for midsize companies looking to scale
• Enterprise (custom pricing): for global enterprises with custom needs

2. QuickBooks Online

Cloud-based accounting solution QuickBooks Online is tailor toward small to medium-sized businesses. While it offers a ton of financial management features, from basic bookkeeping to advanced reporting, QuickBooks also supports over 650 integrations, making it viable for most industries. Its mobile app allows you to manage finances, send invoices, and track expenses on the go.

Key features:

• Automated bank feeds with smart categorization
• Customizable invoicing with online payment options
• Expense tracking with receipt capture and mileage tracking
• Real-time financial reporting with 40+ built-in reporting templates
• Inventory management with low stock alerts

Pros:

• Extensive integration capabilities with popular tools like Shopify and PayPal
• Scalable plans to accommodate businesses from startups to established subject matter experts

Cons:

• Advanced features in higher-tier plans can be complex for accounting novices

Pricing:

• Simple Start: $25/month (1 user)
• Essentials: $50/month (3 users)
• Plus: $80/month (5 users)
• Advanced: $180/month (25 users)

There’s a 30-day free trial available for all plans.

3. Xero

Startups like Xero’s cloud-based accounting software for its intuitive interface and healthy feature set. Xero offers quality cash flow management tools and integrates with over 800 third-party apps. It’s real strength lies in its ease of use for non-accountants.

Key features:

• Bank reconciliation with machine learning categorization
• Customizable invoicing with Stripe and GoCardless integration
• Project costing with time tracking and billing
• Inventory tracking with reorder points
• Multi-currency support (over 160 currencies)

Pros:

• User-friendly interface with a minimal learning curve
• Quality mobile app with expense claims and invoice creation

Cons:

• Limited customer support options (primarily email-based)

Pricing:

• Early: $12/month (5 invoices, 20 bank transactions)
• Growing: $34/month (unlimited invoices and bank transactions)
• Established: $65/month (multiple currencies, expense claims) 30-day free trial available for all plans.
  

4. Sage Intacct

Sage Intacct is a popular cloud-based financial management solution for startups with complex accounting needs or those in specific industries like SaaS or nonprofits. Multi-entity management and financial consolidation are two of Sage Intacct’s more advanced offerings.

Key features:

• Compliant revenue recognition automation
• Multi-entity and multi-currency management with automated eliminations
• Customizable reporting for detailed financial analysis
• Project accounting with resource management and billing
• AI-powered timesheets and anomaly detection

Pros:

• Highly scalable for rapidly growing, multi-entity businesses
• Strong compliance features with GAAP, IFRS, and SOX support

Cons:

• Steeper learning curve compared with entry-level accounting solutions

Pricing:

• Sage Intacct uses a custom pricing model based on modules and user count. Contact Sage for a personalized quote.

5. Wave Accounting

Wave is a free accounting software designed for small businesses and startups. Wave offers basic accounting features as well as paid add-on services like payment processing and payroll.

Key features:

• Double-entry bookkeeping system
• Customizable invoicing with credit card and bank payment options
• Receipt scanning with mobile app
• Basic financial reporting (income statement, balance sheet, cash flow)
• Support for over 160 currencies

Pros:

• Core accounting features are completely free
• User-friendly interface helpful for non-accountants

Cons:

• Limited inventory management capabilities
• No built-in time tracking feature

Pricing:

• Accounting software: Free
• Credit card processing: 2.9% + $0.30 per transaction
• Bank payment processing: 1% per transaction
• Payroll: Starting at $20/month + $6/employee
  

Startup accounting teams face unique challenges that can significantly impact their growth potential. Understanding these hurdles is important for selecting the right startup accounting software and implementing effective financial management strategies. Let's explore the key challenges that often hinder startup finance teams and how modern accounting solutions can address them.

Budget constraints

Limited budgets often force startups to prioritize immediate needs over long-term scalability. But cheaper software that may not accommodate future growth, potentially resulting in costly migrations down the line. As hard as it can be to spend precious dollars, it's crucial to balance current affordability with future needs when selecting accounting software for your startup.

Lack of accounting expertise

Most early-stage startups have team members wearing multiple hats, and sometimes that means there’s no dedicated accounting or financial leader. That’s why user-friendly software with intuitive interfaces and comprehensive support resources is so important. Some startups may even rely on external accountants or consultants, making software with native collaboration features essential.

Time management

What if accounting teams juggling multiple responsibilities could drop a few of the time-consuming tasks? Accounting software with automation features such as bank feed synchronization, automatic categorization, and recurring invoice creation can reduce manual data entry and free up time for more strategic projects.

Cash flow management

Cash flow is vital for startup survival and growth, and accounting software plays a crucial role by providing real-time visibility into financial positions. Features like cash flow forecasting, accounts receivable tracking, and customizable financial dashboards help startups get ahead of potential cash crunches before they occur and make informed decisions.

These challenges underscore the importance of choosing accounting software that can unlock additional downstream benefits. By addressing these common hurdles during the software evaluation process, startup accounting teams can transform potential roadblocks into opportunities for efficiency and growth.

All businesses spend money, but how and where a business spends money is even more critical for startups to understand. In exploring several accounting software options, Brex provides startups specifically all the tools and automation capabilities required to bring transparency to their financial health. Let's examine the specific features that set Brex apart on accounting automation.

1. AI-powered expense categorization

Brex's leading AI technology simplifies expense management by automating the categorization of transactions. By significantly reducing manual data entry, Brex minimizes human error in expense allocation and saves valuable time. The best part: Brex actually learns from your spending habits. So the more you use it, the better it gets at figuring out where each expense belongs. Our custom categorization rules ensure Brex supports your industry-specific requirements. And with real-time categorization as transactions occur, you'll always have an up-to-the-minute view of your financial posture. Whether you're a small startup or a rapidly scaling company, Brex's AI-driven categorization scales with you, maintaining accuracy and efficiency as your transaction volume grows.

2. Comprehensive integration capabilities

Brex's power is amplified by its ability to connect effortlessly with the most popular financial tools and software. Native integrations with top accounting platforms like QuickBooks Online and Xero ensure real-time data syncing, eliminating the need for manual data transfer and reducing errors. Brex also connects with enterprise solutions like NetSuite. The platform extends beyond just accounting, integrating with productivity tools like Slack for fast approval notifications for lightning-fast reviews. Brex’s API access allows for custom integrations with your existing tech stack, ensuring that Brex enhances your current workflows rather than disrupts them. From expense tracking to reporting and analysis, Brex creates a cohesive ecosystem that not only saves time but also helps enable a more holistic view of your company's financial health.

3. Automated reconciliation and reporting

Expense reconciliation and reporting are less of a pain with Brex’s advanced automation features. We use OCR technology to automatically match receipts to your employees’ transactions, significantly reducing the time spent on manual data entry and document chasing. Real-time transaction data ensures more accurate financial insights and better decision-making. Additionally, Brex's reporting capabilities offer customizable drill-down features that allow for detailed analysis of your financial data. Perhaps most impressively, Brex can save your team up to 250 hours a year* with accounting automation, freeing up your finance team to focus on strategic tasks rather than getting bogged down in reconciliation.

* The metrics provided are from July 2023 and for illustrative purposes only. Past performance does not guarantee future results, which may vary.

“With Brex, the accounting team is saving 5 hours per month on receipt tracking and 10 hours on month-end reconciliation.” — Ty Barton, Accounting Manager, Signifyd

4. Built-in compliance and audit trail

Compliance is non-negotiable, and Brex makes it easy to stay compliant. Our platform comes with built-in features to automatically enforce your company's spending policies at the time of spend, reducing the risk of non-compliant expenses. Every transaction and approval is meticulously recorded, creating a detailed audit trail that can be invaluable during financial reviews. Managers and accountants only have to review the exceptions. Brex also is designed with regulatory compliance in mind for standards like SOX and GAAP and offers secure storage for all your financial documents, including receipts and invoices. This comprehensive approach not only reduces your risk but also simplifies the audit process, potentially saving your team countless hours of preparation time.

5. Real-time spend tracking and budget management

Brex truly brings “real time” to tracking spend and budget management features. Our platform provides instant visibility into all transactions across your organization so you can monitor spending as it happens. When you set up custom budgets for different departments, projects, or expense categories, Brex can send automated alerts when spending approaches or exceeds these limits. Such proactive financial management prevents teams from overspending before it happens. Customizable dashboards also give you a bird's-eye view of your startup’s finances at any given moment. With Brex, you're always in control of your company's spending.

“From an FP&A standpoint, Brex helps us analyze our spend, track trends, surface insights, and help the management team make better decisions.” — Katherine Spillane, Assistant Controller atAvenue One

6. Automated approval workflows

Brex revolutionizes the expense approval process with its workflow automations. Gone are the days of chasing down managers for signatures or going line by line through every expense report. With Brex, you can set up multi-level approval chains that automatically route expenses to the appropriate decision-makers. They’ll get real-time notifications and can review and approve expenses right from their email or the Brex app. Brex also maintains a clear audit trail of all approvals, making it easy to track the status of any expense and who approved what and when. By automating time-consuming approval processes, Brex helps your team stay focused on strategic tasks while ensuring employee and financial compliance.

These features collectively make Brex a standout solution for startups looking to automate and streamline their accounting processes, saving time and reducing accounting errors while providing powerful financial insights.

Choosing the right accounting software is a critical decision for startups, with long-term implications for financial management, operational efficiency, and scalability. However, traditional accounting software falls short of addressing the unique challenges faced by high-grow brands like startups.

This is where innovative platforms like Brex are making a significant impact. By combining cutting-edge AI technology, comprehensive integration capabilities, and startup-specific features, Brex offers a solution that goes beyond mere bookkeeping to provide a holistic financial management ecosystem.

To fully appreciate these capabilities, sign up for a demo to see how Brex can address your specific needs.