Startup: Getting a Financial Edge

Many startups begin with a fantastic idea and highly specialized talent. But, a distinct lack of knowledge regarding the financial side. Investors and lenders see hundreds of ideas that are a great idea but not a great business. This usually dissuades them from any type of investment. But for intelligent entrepreneurs, this actually represents a great way to get a competitive edge. By using available technology to create real-time, professional, and accurate financial statements, startups can successfully court investors while also building themselves a firm financial footing.

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The Advantages of New Cloud-Based Accounting Systems

Just a decade or two ago, most enterprise accounting systems required expensive licensing and specialized knowledge. Small business owners often found themselves doing the books on paper ledgers or using spreadsheets to organize their data. Today, cloud-based accounting systems are available to give startups enterprise-grade technology at small business prices. Therefore, cloud-based accounting systems have some major benefits for new entrepreneurs:

  • Intuitive and easy. Cloud-based systems are generally as easy to use as a website. Designed for user-friendliness and a positive user experience.
  • Accessible from anywhere. Business owners access their accounting information and financials from home, client sites, and other offices. This offers a distinct advantage for business owners who need to travel or who are always on the go.
  • Advanced real-time analysis. Cloud-based systems provide advanced data analysis, in the form of professional and polished financial statements. By importing bank data and making it easier to access data from anywhere, cloud-based systems can offer real-time information — allowing a company to make better decisions faster.
  • Affordable and scalable. For a low subscription fee, you can go cloud-based. Furthermore, most companies offer different tiers of service. As a result, you can upgrade your system as you increase in volume and the system will scale to the size of your organization.
  • Secure and stable. Cloud-based systems run with best-in-class security standards, ensuring that financial information is kept safe. Small businesses are now a primary target for cyber criminals, making security a paramount concern. Cloud-based systems also have large volumes of resources available, so they will remain stable and reliable throughout a company’s operations.
  • Integrated and automated. Cloud-based systems can often be integrated directly with point-of-sale solutions and can be synced with bank accounts and credit accounts, streamlining processes and also reducing the chances of inaccuracies and mistakes. 

The Importance of Fast and Reliable Financials

Prospective investors often need to see financial statements as quickly as possible to make educated and informed decisions. Also, current investors need to see how your business is currently doing to determine whether it was a good investment. Many startups find themselves falling behind in their financial statements and it can be very difficult to catch up. After all, they are concentrating on revenue-generating activities rather than administrative activities. Investors and lenders may become frustrated, as they may feel that they are not being kept up-to-date on the company’s current performance.

Internally, fast and reliable financials empower a business owner to make the best decisions regarding their business. Startups in particular need to be able to see trends quickly. They need to know whether their current business strategies are truly working. Fast, accurate financial statements means it’s easy to see how your business is performing. So, if a business isn’t able to do this, it may have no idea of trouble until it’s too late.

Financial statements are more than administrative work; they are the core of a solid business. Through better financial statements, a business can procure new investors and keep their current investors in the loop. Luckily, the technology is there for many startups to acquire solid financial statements with ease. Cloud-based accounting systems automate many of the involved processes and can streamline the entire process. Business owners who are interested in developing their competitive edge may want to look into these systems.

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