How to Start a Bookkeeping Business

You can read more about our ratings for various business accounting software here. You should be familiar with more than one software as some of your clients may have a preference in terms of the accounting software that they’d like you to use. Bookkeeping software was designed to make it simple for small business owners to do their own bookkeeping. But many owners don’t have the time or desire to do that, and that’s where you can step in and provide a ton of value for them (and be well compensated in return). While most businesses require an investment to buy equipment, rent space, stock up on inventory, etc., you can start a bookkeeping business for next to nothing. Many cloud-based tools are free for bookkeepers and allow you to work from anywhere with an internet connection.

• Before starting a bookkeeping business, you’ll first need to know the basics of operating legally.
• But, low quality bookkeepers are trying to get the transactions into QuickBooks as quickly as possible to save time, and they don’t really care if they’re labeled or if they’re in the right categories.
• Typically, the earlier, the better, because you will be set up with the best financial practices from the beginning.

A CPA will help you decide which accounting method makes the most sense for your business and what will give you the best tax breaks. Accrual basis accounting counts money and expenses when it is earned instead of received. This type of accounting is more involved but will give you a clearer outlook of the business’s future picture.

Best for On-demand Reports

Keep reading to learn more about accounting basics and how you can implement a useful accounting system for your startup. As any entrepreneur can tell you, there are plenty of “well-meaning” friends and family who will worry about your choices. They’ll quote statistics about failed businesses and tell you how much safer it is to just get a corporate job. But recent layoffs and market conditions have left a lot of people considering starting something of their own. Before you choose your business name, make sure someone else isn’t already using it, lest clients get confused.

• You should be familiar with more than one software as some of your clients may have a preference in terms of the accounting software that they’d like you to use.
• We generally recommend that businesses move away from spreadsheets and into an accounting software as soon as possible.
• Keep reading to learn more about accounting basics and how you can implement a useful accounting system for your startup.
• At that point, it makes more sense for the founders to be 100% focused on growing the business, and let an experienced startup bookkeeper handle the books.
• You should be excited about what your business is building towards in its future.
• Clients who have worked with Kruze have collectively raised over $12 billion in VC funding.

Remember that the amount that you charge should be contingent on your years of experience, specialization in industries, certifications you carry and your area. And, of course, your rate isn’t fixed — you can always change it if you feel like you’re not priced correctly. If your clients will be sending you things such as receipts or statements, you might want to consider the tool that you’ll use to share files. A popular option is Dropbox, in which you can create a shared folder that both you and your clients have access to. Our team is trained to look for specific errors based on your company’s stage. When you find that the management of your business’ financial concerns have you stretched thin, you should consider hiring a CFO to help.

Set up your chart of accounts

A good accountant can help you put together these essential reports. Great bookkeeping can ensure the data required to create the reports is ready to use. At FinancePal, we take pride in helping businesses like yours succeed with our advanced, customer-oriented, online startup accounting and bookkeeping services. And, our team of financial experts are always available to provide accounting advice for startups who want to make sure their business is in the best possible position. Most very-early stage startups do not need a third party, nor a full-time, bookkeeper.

• The first step in getting started is getting yourself set up with the tools and know-how.
• Transactions are usually found by reviewing invoices, bank statements, etc.
• It’s the leading small business accounting software in the US for small businesses, and interfaces nicely with other automated systems like payroll.

If you’re specifically interested in working as a bookkeeper remotely, establishing a website and social media profiles may be a starting point for your marketing plan. Both can make it easier for potential clients to find you in online searches. You can also leverage social media to build your brand and increase your visibility. Before starting a bookkeeping business, you’ll first need to know the basics of operating legally.

DIY Accounting or Hire in a Professional?

You may be ready to be your own boss, work virtually,  make your own hours, and build your own accounting software program. If you want your business to save time and money then, yes, you should consider hiring a bookkeeping service. A bookkeeping service can help you stay organized and on top of your finances. Opening a business bank account can make it easier to keep track of what funds go in and out.

• You can join industry-related groups, participate in discussions and share relevant content to establish yourself as an expert in your field.
• Some of the best accounting advice for startups is to know your basic accounting terms.
• Bookkeeping software was designed to make it simple for small business owners to do their own bookkeeping.
• It is better to be safe than sorry when it comes to proving your business to the IRS.
• Before you choose your business name, make sure someone else isn’t already using it, lest clients get confused.
• This way, whether you’re doing your bookkeeping and accounting on your own or a professional is handling it for you, you will be able to understand what is going on with your startup’s financial situation.

It’s possible to start a bookkeeping business from scratch, even if you don’t have a professional or educational background in accounting or bookkeeping. Having a degree or certification in either area could be an advantage, but it’s possible to acquire the skills you need to become a bookkeeper online. Likewise, you don’t need to have experience running a business, but that, too, could prove helpful.

Best High-Yield Savings Accounts Of September 2023

Basically, it’s a list of all of the places where you might want financial transactions to be recorded. CEOs of early-stage companies have a tremendous number of things to accomplish. Kruze’s bookkeeping team strives to handle all the minutia so you can focus on growing your business, achieving product-market fit, advancing your R&D, hiring, etc. We understand the pressure of running a hyper-growth business, and want to make your financials as easy as possible.