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Bookkeeping for Startups and Small Businesses: Most Common Pain Points

By January 26, 2021 No Comments

When business owners and entrepreneurs come to us for help, they’re in need of a solution, and so the first thing we really try to pinpoint is: What is the major pain point that you’re trying to address? 

As it turns out, many startups and small businesses are facing very similar issues, and we consistently see five common themes pop up. Any of these sound familiar?

Bookkeeping for Startups and Small Businesses: Top 5 Challenges

1. There’s no consistency or responsiveness when it comes to their current bookkeeping.

The first issue we hear is that there’s little to no consistency in the bookkeeping services they’ve used in the past. That’s a valid concern, and here’s why: According to a study that we found, the more frequently you do your accounting, the better chance your company has at survival. One in three businesses goes under in the first two to three years, and so not having your finances in order really hurts your chances to survive. 

This pain point, in particular, influenced how we developed our services, and it’s why we decided that a monthly cadence was really the bare minimum needed for us to provide the kind of support that people need. Acuity offers monthly, weekly, or daily bookkeeping services to address the issues of consistency that many businesses face. 

2. Business owners don’t have enough time for finances.

The second thing we hear very often is that business owners don’t have the time to focus on finances, or that it’s starting to take up too much time. When we looked at the numbers, we found that people spend, on average, 81 hours a year on tax prep trying to do it themselves. That adds up to about 230 hours on average, per year, that they can save by outsourcing their bookkeeping. 

One of our favorite quotes — we call it the Full Employment Act for bookkeepers — is that 40% of small business owners say that bookkeeping and taxes are the worst part about owning a business. So, our hope at Acuity is to alleviate that problem for these entrepreneurs through our bookkeeping services, accounting services, and CFO services.

3. Business owners wonder if financial reports are actually useful.

Believe it or not, one of the other common issues we hear is that financial statements just aren’t useful — or entrepreneurs don’t understand how to read/interpret the information. We found a Gartner study that showed the path that entrepreneurs follow before they reach the end goal of being able to synthesize and analyze financial data. 

bookkeeping for startupsIt’s a progression that starts simply by managing their bank accounts, followed by understanding a profit and loss statement, managing bills and payroll, understanding customer acquisition costs, and so on. Acuity works to solve this pain point by meeting you where you are on this continuum, and then pulling you forward through that.

4. Managing financials is too complicated.

We hear a lot of clients say that their financial statements are too complicated or too messy, so one of the things we try to do is simplify things with technology. A prime example of this is one of our technology partners, Jirav, a platform that provides our customers with a dashboard that allows them to visualize their financial statements. 

Today, we have 20 technology partners and a dedicated technology stack team that evaluates the technologies we use to make sure that they can track down big problems that our customers are having and see if there’s a way to solve them instead of using a manual process. And we are committed to certification in order to ensure that we know how to use the latest technologies. We’re proud of the fact that we have 150 current technology certifications across a variety of platforms within our team. 

Bottom line: Acuity works to break it down, simplify the data, and meet our clients where they’re at so they understand the financial information at hand.

5. Someone on the finance team quit or just isn’t performing.

The last thing we commonly hear is that a team member isn’t performing or that an employee just quit. Many companies start out by hiring one person in-house to manage their finances, but then they’re really limited by that person’s skill set, vacation schedule, training commitment, and so on. And because there’s one person, they don’t necessarily focus heavily on process or communication. 

That’s why Acuity goes with a team-based approach. We spread out the accounting function into four easy-to-remember categories: compliance (tax returns), tactical (things like bill pay), complicated accounting (a controller handles this), and strategic (your CFOs). We document all of the processes, so even if a team member is out, things keep running smoothly and nothing falls through the cracks. We also have a customer success team, quality control team, and CFO office hours to handle any issues that could arise. 

Does your business struggle with any of these five common accounting pain points? If so, it might be time to outsource your financial needs to a company like Acuity. Our services are centered around making things easier for you —  no matter where your business is in your financial journey. Get in touch to find out how Acuity can help.