OUTSOURCED BOOKKEEPING

Founders and CEOs of early-stage companies understand that accurate and up-to-date financial information is critical for the operation of their startup, communicating with investors, and preparing for upcoming funding rounds. While many founders start by doing their own bookkeeping, that can quickly become a significant investment in time and effort. That’s time that could be spent running the company. At that point, a founder might want to consider outsourcing the company’s bookkeeping. Reasons that you might want to outsource your bookkeeping include:

• Resources. As noted, routine bookkeeping tasks take up founders’ time, which is a resource that’s very scarce. Outsourcing frees up company employees to do the things they do best.
• Quality. Outsourcing bookkeeping gives you access to experienced, skilled, and trained accounting staff. Your bookkeeper’s knowledge of tax rules and financial reporting means you’ll get the quality results you need. 
• Accuracy. An outsourced bookkeeper will know how to prepare your financials records so that investors, boards of directors, lenders, and the IRS are satisfied with them. You won’t need to question the integrity of your financial data. 
• Scalability. Typically small companies don’t need full-time bookkeeping services. As your startup grows, your accounting needs will, too. An outsourced bookkeeping company with a full suite of services can scale to meet your needs, and you won’t need to hire additional staff.

To make effective business decisions, you need an accurate financial picture of your startup. You need to have a clear understanding of your cash management, your runway, your monthly expenses, your financial statements, your taxes, and more. Outsourcing your bookkeeping ensures that all those essential functions are handled by a team of skilled financial professionals.

Kruze account managers have an average of 11 years of experience with handling the finances of early-stage, venture-funded companies. We’ve developed highly automated processes and systems that help us save you time and money on bookkeeping services, plus we go beyond bookkeeping to provide you with due diligence and financial advice that reflects the needs and requirements of startup companies. Services include:

Recording financial transactions

Kruze’s outsourced bookkeepers record your revenues and expenses into your company’s accounting system, categorizing transactions and reviewing your books and financial records to make sure they are error-free.

Revenue recognition

Revenue numbers are crucial to raising additional rounds of venture capital, and VCs will check to see if there are discrepancies in revenue numbers. Incorrect revenue recognition is one of the biggest reasons that startups switch to Kruze for bookkeeping services. Online bookkeepers that have limited accounting experience may claim to do everything with automation, but it’s usually the founder who has to code all the transactions.  

Reconciling accounts

Reconciliation is an important part of bookkeeping, making sure that different records balance and that funds leaving your accounts match the actual money spent. Accurate books are essential to companies that raise venture capital, since company executives have to deliver regular, accurate financial reports to investors.

Cash management

Burn rate needs to be carefully managed in early-stage companies, and founders need to know exactly how much money they have and how much they’ll need to continue operations. Kruze uses automated systems to manage accounts payable, and feeds that data into your accounting system for up-to-date cash management.

Preparing financial statements

Every month, founders, investors, and board members want to see three important financial statements: income statements, cash flow statements, and balance sheets. Kruze has developed automated systems to provide startups with low-cost, highly accurate financial statements and financial reports.

Unlike mature businesses, startups have unique requirements and need financial advice from a knowledgeable and experienced bookkeeper. Automated bookkeeping software can make mistakes, which means your company may not be ready for upcoming venture capital or merger & acquisition due diligence. Kruze Consulting handles the complexity of early stage bookkeeping and provides you the financial data you’ll need. Kruze is a pioneer in cloud accounting, and has been an Intuit Firm of the Future Finalist, an Expensify Emerging Partner of the Year, and a Gusto Gold Partner.

Not working with a skilled outsourced bookkeeper can end up costing founders money:

• Knowing how your money is spent can help you manage costs and reduce your burn rate, which looks good to investors.
• Sometimes venture capital fund raising or mergers & acquisitions happen very quickly, and you don’t want to delay the process with incomplete or incorrect financials. 
• Good bookkeeping makes sure you’re collecting your revenue and not over-paying any vendors.
• Solid financial records can help you capture tax credits, like the R&D tax credit, which could save your startup thousands of dollars.

The best outsourced bookkeeping firms, like Kruze, charge clients fixed monthly fees for their services. The typical Kruze client is charged between $500 to $1500 a month, depending on the complexity of the books, the number of transactions / expenses, tax compliance needs, and the client’s growth. Kruze bookkeepers and controllers support companies that raise later stages of funding (Series C and beyond), and these clients often save hundreds of thousands of dollars in yearly, in-house accounting salaries by using Kruze’s team. See our interactive pricing estimator below to learn more.