Accounting for startups: How tech startups can leverage technology in their accounting operations

May 22, 2024


Founding a tech startup is about bridging the gap between a need and reality with technology. That firm focus on the power of technology should encompass as many areas of your business operations as possible, accounting being the foundation of your venture.

As a technology startup, we saw firsthand what was missing in the accounting and bookkeeping sphere: automated data entry, accounting for subscriptions, customization for specific business needs, and real-time and detailed financial picture of the company anytime you want, among others.

In this article, we’ll show you how our automation and technology tools can help you solve your bookkeeping and accounting problems right at the core, while also giving you tools for a better understanding of your own business—both a medicine and a vitamin.


No manual data entry: Each transaction should be automatically recorded in your books

That needs to be a baseline for bookkeeping –  automated data entry. Technology can really do it incomparably faster and much better than any human can. So the issue is not that you should automate transaction recording but how many processes can be automated in your startup.


Multi-platform integration: Choose from over 30 platforms to integrate

Synder Sync automates the recording of financial transactions from various platforms directly into accounting software like QuickBooks, Xero, and Sage Intacct. It covers a broad spectrum of payment gateways (such as Stripe, PayPal, or Square) and sales channels (like Shopify, Amazon, BigCommerce, etc), among others. 

So whether you use major payment providers to accept payments, or online marketplaces to sell your products or services, Synder Sync can help. Its wide integration capability allows your startup to bring together financial data from different sales channels and payment systems into your accounting platform without manual entry, errors, and duplicates.


How your business is doing right now: Real-time synchronization

Startups undergo rapid changes, that’s their nature. And you should see it in your finances. Waiting a month to understand how your business was doing is helpful but you need to keep a hand on the pulse and check the financial performance as it happens, not only long after it happened.

Synder Sync provides real-time synchronization of financial data with the company’s accounting software. This means that as soon as a transaction occurs on any connected platform or payment system, it’s instantly reflected in the company’s accounting records. This gives you a clear view of your company’s financial health, helps in decision-making, and effective cash flow management.


Custom level of data synchronization

How you organize your books is up to you and your accountant to figure out. Synder supports you no matter what you choose by offering different synchronization modes: per transaction sync and daily summary sync.


Per transaction mode

In this mode, Synder Sync records each transaction individually in real-time as it occurs. This level of granularity is perfect for businesses that require detailed transactional data for precise financial tracking, analysis, and reporting.

It gives you the following information:

  • Customer details: This includes the customer’s name, address, and email, providing a clear view of who’s making the purchase.
  • Product information: Detailed information about each product sold, including product names, SKUs (Stock Keeping Units), and quantities purchased.
  • Sales information: The price of each item, the total sales amount, and any discounts applied to the purchase. This ensures a detailed breakdown of the sales transaction.
  • Tax details: The tax amount charged on the sale, which is essential for accurate financial reporting and tax compliance.
  • Payment processing fees: Reflects the costs associated with processing the payment for the transaction, which is recorded as a separate expense. This helps in understanding the net income from each sale.
  • Payment gateway: Specifies whether the payment was made through Stripe, Shopify Payments, PayPal, or any other payment gateway used by the customer. This helps in tracking and reconciling payments across different platforms.
  • Transaction date and time: The exact time and date the sale or transaction occurred, aiding in chronological financial tracking and analysis.
  • Refund information: In the case of refunds, a detailed transaction showing the refund for the same client, including the refunded amount and any associated fees or adjustments.


Daily summary mode

For some startups, like subscription-based businesses, those with frequent microtransactions, or other high translation volume companies, this amount of data in their system might be not what they’re looking for. That’s why we have a daily summary mode that aggregates all transactions for a given day per platform into a single summary transaction that is then recorded in your accounting software. 

The daily summary mode emphasizes the most crucial financial data—sales, fees, refunds, taxes, and discounts—without delving into the specifics of customer/product data. This focus can be particularly appealing for businesses that prioritize a broader financial overview over granular transaction details.

This mode is great for businesses looking to simplify their financial records or those with a high volume of transactions, where recording each transaction separately could clutter the books. 


Customizing your recording process: Smart Rules for Accurate Categorization

The way you want to allocate different transactions to the right accounts can be set up at the start with the help of Smart Rules. With this feature, you can create automatic rules based on your chosen criteria to help you better categorize your transactions. 

Let’s say you’re syncing data from Stripe to process payments for your software subscription services. You offer 5 subscription tiers with different payment schedules. With Smart Rules, you preselect your conditions like product name, amount, etc., so that when each of those individual subscriptions from Stripe arrives in your books, they’re automatically allocated to the right revenue account. 

How does it help you? You not only have a clear financial picture, but you can see what brings you the most revenue, which services to possibly expand or drop off, and where you need to focus your marketing efforts. All with the help of Smart Rules. 

If you want to automate your entire subscription process with revenue recognition flow, Synder has a new product called RevRec that lets you automate this process fully.


Automatically closing open invoices when paid

Automating accounts receivable for your startup can be a real timesaver. Here’s what usually happens. 

When a sale is made on credit, and an invoice is issued to a customer, that invoice remains open until the payment is received. Typically, tracking and matching these payments to their respective invoices is a manual and time-consuming process. 

Synder Sync streamlines this by automatically syncing open invoices from your accounting software with incoming payments from Stripe, for example. So, as soon as a payment is completed in Stripe for a particular invoice, Synder Sync identifies the corresponding open invoice in the accounting software and updates its status to “paid.” This process involves matching the payment received with the correct invoice based on unique identifiers like invoice numbers, customer information, time stamps, etc.


Pre-matched reconciliation process

This flow of auto-applying payments for open invoices takes us straight to reconciliation. When there comes time to reconcile your bank account with your books, all transactions are pre-matched and neatly aligned for your approval. It takes a moment to reconcile, not hours.


Accounting process that can be scaled

Moving from the pre-seed stage to series A, and beyond, you want a solution that can grow with your startup. As needs become more complex and your transaction volume higher, your software should be able to grow with you.

Just as Synder is growing with its clients, so are our solutions. We’re continuously creating new features and even custom flows for our clients so that they can have the full financial picture they need. 


Automating your accounting for a clear financial picture: Closing thoughts

Automation in accounting should be a natural part of any startup. It frees up your resources and gives you real-time access to the most up-to-date financial information. 

To make data-driven decisions, you need a complete and solid set of data, on a moment-by-moment basis. And Synder can offer you that.

From our humble beginnings in the Y Combinator, our startup journey has taught us (and is constantly teaching us) how to best address the needs of startups. So if you think that our services can give you a boost in your business journey too, get in touch with us and we’ll help you do that.