Data & Stuff // Neil Houston

Last year I discussed some of the tools I was finding useful for running my company. This post is an extension of that and discusses how things have changed now.

The biggest change is regarding finances, and how we handle them. Previously we had used Freshbooks for our Invoicing needs, and also used it to track expenses. This worked to a degree, but due to the nature of our revenue streams we had items that were ‘off book’ and we couldn’t account for them in FB, instead a variety of spreadsheets and other tools were needed to keep on top of everything.

The issue we were finding was two fold,
1) Proper tracking of all our revenue streams and being able to segment our expenses into P/L accounts with decent breakdowns, budgettng etc. [And not just things we had invoiced].
2) And how much have we spent, over time by category.

It’s not to say that Freshbooks doesn’t work well. I could easily see how if you were a freelancer, and doing timetracking, and rebilling expenses to clients that it suits your needs. For us, we needed accounting details, and thought it was time to see what else was out there.

There are variety of SaaS web accounting packages out there, and the one we went for was Xero. A personal recommendation secured it, easily when it was referred to as ‘idiot proof’ - perfect for my needs.

Quite simply Xero allows us to have information about our bank accounts (including paypal), and set up automatic rules for dealing with transactions that are not Accounts Receivable/Invoiced based (i.e Google Adsense earning, users buying subscriptions, and clothing orders).

For FY11 we will be able to setup our budgeting, and have one or two views that really give us an overview into how the ‘business’ is running.  All we want is for Kitecrowd to get into the black, and with Xero we now have much more of an idea as to what our core expenses truly are, and what those ‘one off costs’ of year one really amount to.

Due to Xero being able to handle our Invoicing needs, we will be dropping Freshbooks. It’s certainly worth a look though if you use other accounting packages, and l’d strongly suggest testing the market – only by trying things will you know what will allow you an effective workflow.

I’d also like to say how good the service is from Freshbooks, and Xero. A welcome from Xero, and an enquiry from Mike McDerment Freshbook CEO about what I was finding hard with expenses, and why I’m switching. So Mike, this is for you – you guys rock, and served my needs well, but you just at this moment in time don’t allow me to get enough information about how my business is operating.

On an aside, Xero can integrate with Freshbooks, but we are a small company, and can’t afford to be paying for two solutions that handle Invoicing/Expenses. When one of them also handles the rest of our accounting functions, maybe this will change in the future, maybe it won’t. Either way Freshbooks it’s been fun using you.