Monday, January 17, 2011

Meet for business

Those who've used and have a business are probably wishing they had an accounting system as frictionless as that! I certainly am and for a while I've kept an eye on web-based billing and accounting applications out there, of which I must say there's no shortage. My criteria has been to find something that would replace Quickbooks entirely while providing a kind of experience, that would offer effective cash flow management, and would be integrated with CRM systems and credit card terminals.
Problem with accounting software has always been that it required dedicated time to collect and enter the data and the more data has to be entered, the more daunting the task becomes, so most business owners would just relegate the job to the bookkeeper / accountant and thus would rarely use it as a business intelligence and forecasting tool that it could be. I think this is about to change however. I think we're nearing a point where business owners are actually going to start living inside of their finance systems much the same way they currently live inside email/calendar.
Why you ask? Due to a new generation of online accounting solutions that do more, make it much more than simple double entry accounting. The new systems have integrated invoicing, automated collection, multi-user access, reporting, and most importantly - bank account sync! This last point is what I think is what could tip the scales for these solutions, and is a reason why I want to highlight Wave accounting.

Wave is the only one out of half a dozen solutions I’ve looked at that places the “frictionless” experience high on their priority list. From getting the bank transactions into the system (which is done via an automated sync) to auto-categorization. To me this is really the key to moving from “get the books done once a month” experience to “use it to manage your business” one. Specifically, it allows the manager to:
  1. get a good handle on your cashflow
  2. review the categorization
  3. and most importantly, not wait for your bookkeeper to get through the transactions in order to generate an up-to-date report
And yes, other system too can import financial report from your bank, but there’s a big difference between having to log on to the bank account, go the right section, dump a report, import it into the system, repeating it for each account.
Wave is missing a few features that their competitors have like time tracking, expense handling, estimates/quotes/proposals and other CRM-type of functions) but those are not rocket science and I’m sure Wave is looking at adding those soon (just like the competition is probably going to look into adding live sync and auto-categorization.)
In any case, I think the train is about to leave the station and Intuit has some serious competition to worry about. I’m really excited about watching this space.
Other very capable online accounting packages:
Freshbooks (time tracking, contractor handling), Kashoo, Yendo, Xero (handles expense claims), Free Agent (handles estimates, quotes, proposals), (has a payment portal that accepts ePayments and Paypal)
Update (2/1/2011)
Add to this list Outright - it has auto-sync with credit card and bank accounts like wave, and also has tax estimation. This is not a ledger product however, so don't expect to do serious accounting with it. It will produce a schedule C. No access to other parties. Best suited for single proprietors from what I can gather.

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