Financial Software: The Ultimate Guide for Modern Finance Teams
The landscape of finance and accounting software is changing. The explosion of new SaaS vendors and rise of remote work has forced businesses to reimagine how employees collaborate and that includes finance teams.
But many teams are stuck using spreadsheets or legacy software that’s been around for decades. Luckily there’s a new wave of finance software designed to help you automate mundane tasks so you can focus on more strategic priorities that help your business grow faster and win. But with 100s of vendors to choose from, how do you pick the tools that are best for your team?
In this guide, we’ll focus on 6 distinct categories of financial software everyone business needs and recommend the winners that’ll help your finance team work smarter including Ramp - the all-in-one corporate card and spend management platform.
- Accounting & Reporting: Stay on top of your financials and ensure accuracy
- Financial Planning & Analysis: Plan for the future to make better decisions
- Payments: Send and receive money — the life-blood of any business
- Spend Management: Manage & optimize spending for employees and vendors
- Payroll & Benefits: Pay and empower your employees to do their best work
- Equity & Financing: Keep the company afloat with optimized capital
1. Accounting & Reporting
Stay on top of your financials and ensure accuracy
Accounting — Automate month-end close
SMB Winner: Xero
Enterprise Winner: Netsuite
Like any solution — choosing the best accounting software depends on your unique business. Small companies often start out using Quickbooks, but Xero is making waves in the accounting community with a better user experience, countless integrations, and speed of feature delivery.
As your business grows, so does the complexity of your organization structure and accounting operations. Accounting teams at mid-size companies often need more sophisticated controls and customization. Here, NetSuite is a great pick for companies that need multi-entity support and custom reporting requirements.
Extra points: Still, most of the work that goes into closing the books each month involves reconciling data across systems such as expenses and journal entries. New wave spend management platforms like Ramp, along with eCommerce and payment players like Shopify and Stripe are focused on automating these mundane accounting tasks entirely.
Reporting — Real-time visibility
SMB Winner: Redash
Enterprise Winner: Looker
In today’s fast-paced business environment, it’s impossible to compete when you rely on decades-old accounting systems and month-old reports. Savvy finance leaders know that a well-maintained data warehouse and modern BI solution is essential for real-time decision making. Many finance organizations even have dedicated analysts and data engineers whose sole responsibility is to cleanse, analyze, and report on key finance metrics like CAC and revenue forecasts.
For startups looking for a simple reporting tool that can handle any SQL query, Redash is the winner. Redash is low-cost, real-time and easily connects to the most common SaaS applications and databases.
As companies scale and finance and revenue operations become increasingly complex, Looker is a great pick. Looker provides enterprise-grade security and governance and allows you to combine data from multiple data sources. Not to mention the dozens of visualization types and a powerful data modeling language your data team will love.
2. Financial Planning & Analysis
Plan for the future to make better decisions
Planning — Financial planning on autopilot
Modern finance teams have shifted away from manual end-of-period reporting on budget vs actuals and towards Zero-Based Budgeting. Zero-Based Budgeting (ZBB) leans into Agile financial planning which helps organizations allocate money more fluidly based on the strategy and needs of the business instead of trying to predict the future.
Traditionally, Anaplan has been the software pick for finance and sales team planning, but Planful is modernizing planning with productized cash flow forecasting and what-if scenario analysis. Expect many of the analysis companies entering this space to increase their value add for strategic finance.
Analysis — Smarter spreadsheets
Spreadsheets aren’t going away any time soon. Analysts still depend on spreadsheets every day for critical analyses, but this software category has remained relatively unchanged for decades.
Enter Airtable - a smarter, more modern spreadsheet with the power of a database. Airtable gives you cloud collaboration, version and access controls, and integrations with your data warehouse to update the analysis in real time. And if you’re embedded in the Google Suite ecosystem, Google Sheets also provides a number of integrations that allow for direct data syncs from other sources (e.g. Salesforce).
Send and receive money - the lifeblood of any business
Payments is a broad term and complex space. For our purposes, let’s focus on two capabilities: making payments and receiving payments.
Making payments — Virtual cards with unlimited controls
Winner: Ramp (credit card)
Businesses need a way to make payments easily for goods and services (e.g. mEvery business needs a way to easily make payments for goods and services - from SaaS software to travel expenses. But the old way of doing things involves a lot of overhead - from manually uploading invoices and paying out vendors and employees. Virtual cards are becoming an increasingly popular solution for making payments, with benefits such as automated spend policies and easy reconciliation. With virtual credit card solutions like Ramp, finance teams can issue virtual cards with a single click and pay vendors instantly.
Receiving payments — Simple plugin for any kind of payment
Accepting payments is now easier than ever. Stripe has built an elegant payment processing API that can be easily integrated with any application and handles dozens of alternative payment methods internationally. Stripe is also expanding to other areas as finance including financing (Stripe Capital) and card issuing (Stripe Issuing).
AP/AR — Automated workflows for complex operations
For any payments that are on specific terms or require invoices, an AP/AR For payments that are on specific terms or require invoices, accounts payable and receivable software is a must. These systems handle invoices, approval workflows, payments (ACH, Wire, Check) and reconciliation with accounting systems. While Bill.com is the popular choice for AR/AP software, startups such as Routable which offer payment automation and accounting integrations are the choice for finance teams looking to save time.
4. Spend Management
Manage spending across employees and vendors
Procurement — Smart platforms that negotiate for you
At early-stage companies, spending often happens haphazardly in order to accelerate growth of the business. But at a certain scale it’s important to centralize procurement in order to regulate employee spend and get the best deal from your vendors. Here Procurify is an industry-standard with a complete set of integrations and customizable workflows, but a few noteworthy startups such as Vendr for reducing software spend and Intello for optimizing usage are making waves. For enterprise companies, Coupa is considered the more robust pick with features such as supplier and contact management.
Expenses — Real-time expense management
Expense reimbursements are painful, inaccurate, and expensive for your organization. Modern finance teams are migrating from out-of-pocket reimbursement solutions like Expensify towards advanced spend management platforms like Ramp. These spend management platforms are tightly integrated with physical and virtual cards to help eliminate expense reports for good.
With granular controls over spend limits and automatic reconciliation, finance teams can reduce time spent approving expenses and chasing receipts and close their books 5x faster.
5. Payroll & Benefits
Pay and empower your employees to do their best work
One of the largest operational costs for companies is paying and supporting employees. Modern payroll solutions offer not just payroll processing, but a suite of other benefits that support employees including retirement, insurance, onboarding, and time tracking. This space (ERP, HRIS, HRMS) is heating up and incumbents such as ADP and Trinet which typically serve larger enterprises are being disrupted by new players like Gusto and Rippling. Rippling is the winner here with an all-in-one approach to HR and IT and simple onboarding experience. Our advice is to pick a solution that can scale since this type of software is sticky.
6. Equity & Financing
Keep the company afloat with optimized capital
Equity — Liquidity to private markets
If you thought understanding your stock options was hard — try administering If you thought understanding your stock options was hard — try administering them! Ensuring that a company is well-capitalized and well-structured is an important part of acquiring talent and giving investors confidence in your company. Cap table software like Carta helps make it easy to structure and issue stocks. Startups are increasingly entering this space to try and create liquidity in the private equity space (e.g. vested which allows employees to sell their stocks) or help consumers become investors (e.g. Angellist Access Fund).
Credit — Cheap loans fast
With interest rates lower than ever, it’s important to think about whether to fund a business using debt or equity. FinTech has focused on making small business lending easier than ever and cheaper by leveraging alternate data sources such as cash flow via bank transactions through Plaid, accounting information from Quickbooks, or payment data from Stripe. These data owners are also trying to get into the lending business — Amazon, Intuit, Stripe, Shopify, and Square all have a small business lending arm leveraging proprietary data to underwrite. Our winner here is BlueVine with its flexible credit lines and sub-5 minute onboarding process.
How to navigate
If your company has a finance need, chances are there is a solution in the market that can fit your needs. Beyond that, outsourcing finance and accounting tasks using these tools is a great way to reduce the workload of your finance department while also claiming large cost savings.
When choosing the right solution for your business, finance leaders need to consider the following:
1. Ease of integration: Does the solution integrate with your existing tools? Does it replace a tool you are currently using? Our recommendation is to pick a solution with direct integrations with your most critical systems.
2. Ease of use: Does your finance team enjoy using the software? Is it intuitive or does it need a user manual? → Pick a solution that delights your employees.
3. Speed of feature delivery: Is the company still investing in the product? Is it responsive to feedback? → Prioritize innovative solutions over comprehensiveness.
4. Flexible pricing terms: Does the company offer low-cost trials to test out the product? Are you forced into expensive multi-year contracts? → Pick a vendor that is transparent and has a low barrier to entry.
5. Scalability: Will the solution scale with your organization as you grow? If it doesn’t, will it be painful to switch? → Choose software that scales, especially if they are hard to replace.
A revolution is coming — one where innovative solutions will redefine not only the way finance teams will manage company financials, but their very roles within the organization. Strap in! The world is about to get even messier.
Learn more about how you can strengthen your finances with Ramp.