If you have the time, you can train yourself to do some of the bookkeeping. Start with these resources:
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Lynda is a great resource for how to learn QuickBooks and Xero.
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YouTube has some fast and easy QBO tutorials here.
You’ll get the most benefit if you simultaneously work on your company’s books while watching the videos. Two caveats though, 1) your time is truly better spent growing and managing your startup and 2) if you get it wrong it will very likely be expensive to clean up the books.
Can you do your books yourself?
So while you can learn how to do the accounting yourself, you may want to spend some time with a CPA to make sure you understand how to do things right.
I had one client who insisted on doing their own bookkeeping with no training. Come tax time we had a lot of cleanup, and so what would have been a between $400 to $750 tax return amounted to a $6200 bill. We would have charged ~$400/month to do the bookkeeping, so not only did they pay more in the end… they wasted their own time :(
Here are some tips for a founder who wants to take on bookkeeping themselves:
- Make sure you are set up with the right legal structure, if you are raising VC: incorporate as a Delaware C Corp
- Get a bank account for the business
- Start tracking your expenses - use an expense tracking software
- Get a payroll system like Gusto or Rippling - you don’t want to mess up payroll taxes, the IRS will come after you!
- Set up a bill payment system
- Get QuickBooks Online or a good accounting system for startups
- Set up your chart of accounts QuickBooks
If you want to handle your own financials for your startup, you can scroll down on this bookkeeping for startups page to see more tips and steps for doing it yourself as a founder.
Finally, make sure you understand the cost of doing it poorly. While this won’t matter as much for small businesses that aren’t trying to raise millions or get acquired for billions, it does really matter if you are playing the typical “Silicon Valley” style startup game.
How Good Bookkeeping Pays for Itself
