If you’re getting a new company up and running, your time and energy are often focused on market assessment, fine-tuning your product or service, acquiring funding, and finding the right team to execute all of your topline goals. Founders and early team members are often just focused on starting somewhere, and we get it. But through this bootstrapping process we often find that startups neglect certain foundational elements of their business until it’s a bit too late. As a result, they’re forced to do some major recorrecting later on – specifically within their accounting and finance processes.
We know, it’s often the last thing you want to think about. However, after working with countless early-stage companies over the years, our team at
As a remote, outsourced accounting firm, we’re intent on helping startups navigate the
Common accounting and finance mistakes Sstartups Make
Not building the team needed to execute effectively and efficiently.
It’s natural to want to keep a lean team as you’re getting your company off of the ground. However, there are many different services a company needs when launching (and growing). Many of these services can be filled with an outsourced solution as opposed to building a full team in-house.
Perhaps you need a model and a budget which requires the expertise of a qualified CFO, but you don’t need this support full-time. You need to pay bills, but again, you don’t need a full-time accounts payable person. Or maybe you need help with a marketing strategy, but building a team is looking to be too costly.
Finding the right partners is so important and their expertise will allow you to scale your business while helping you allocate funds toward
Not being proactive utilizing tools for growth.
Securing the technology and tools needed to optimize your business is incredibly important in a company’s early days and having these systems in place will allow you to grow more effectively.
From accounting software to inventory and cash management, the tools used will assist you in generating accurate financial reporting in a timely manner. The quality of this reporting allows you to have confidence when presenting to investors and board members about the company’s future growth strategy and the funding needed to get there.
Your monthly financials can help or hurt you, and we’ve seen boardrooms waste hours dissecting the financials because of
Worrying about cash.
Don’t use a model to project cash. Instead, use a 13-week rolling
Wasting time on the model.
We always tell our clients that if there’s one thing that’s true about every model ever built it’s this: they’re wrong. Once you accept this fact, you can give yourself the freedom to get the model to a place that it’s good enough, then move on. And, it’s good to remember that a model is a living, breathing thing – it’s meant to be updated as you go!
At the end of the day, establishing accurate monthly reporting is going to be your sweet spot when establishing a solid foundation for your start-up. Once you have this in place, we recommend that our clients focus on things like budgets and
The beauty of doing this work on the front end is that many times, our clients get to a place where they’re able to update the model on their own after understanding how it works. This ultimately allows them to save money in the future. Having more cash on hand means you have more opportunity, and leverage, to build your company.
If you’re interested in seeking outsourced accounting and financial services to help scale your start-up, please reach out at firstname.lastname@example.org or learn more about our work at
About the Authors
Melissa brings over 20 years of certified public accounting experience to her dynamic work at Acru – an outsourced accounting and finance firm. She is adept at supporting companies large and small by establishing the financial infrastructure needed to succeed in highly competitive spaces. Melissa is based in Boston, Massachusetts.
With a special interest in developing tools that inform and guide business performance, Kevin has built his career around supporting founders, investors, and operators of exceptional brands. Together, with his now- Acru partner Annie Carlon, he helped to found and grow Abaci Financial, offering accounting services and reporting to franchise and multi-unit retail clients. Since the sale of Abaci Financial, Kevin has worked alongside his Acru partners to refine the tools used by companies to effectively manage growth and profitability. Kevin is based in Denver, Colorado.
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