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Amid recent crises, several categories of customers have reconsidered their Quickbooks software. Companies from growing businesses to tech startups must encounter a simple question. Should they postpone the search until after they reach their limit? Or should they prioritize the search before seeking funding?

Those considering these options should grasp three ideas before they make their choice.

The Split

If you or a predecessor started your organization on Quickbooks, then you likely understand the design behind Intuit’s product. At over 80% of the small-business accounting market, it outclasses any other competitor. By marketing primarily to accountants, Quickbooks has guaranteed a high volume of users drawn to low rates, low implementation packages, and a high degree of expertise among CPAs.

Quickbooks seems to suit everything from your three-person accounting company to your forty-person consulting firm. Their products vary according to size and needs: the top-billed are Quickbooks Desktop Enterprise (on-premises) and Quickbooks Online Advanced (cloud). As of this writing, the desktop application hosts 40 attendees with the possibility of adding more; the cloud application hosts 28 (25 users plus 3 accountants).

Customers will look at Quickbooks’s upper limit, their maximal capabilities, to explore how long the company has before needing another option. But even their top options offer fractional components of a system. In automation, insight, scalability, security, user interface: neither the top on-premises option nor the top cloud option meets the pivotal needs of any company that needs to grow.

Two limits. No System

What do we mean by this?

In other words, the question of upper limits devolves to a question of which workarounds and manual efforts you can handle. Here we will examine Quickbooks’ upper limit: on-premise (Desktop Diamond Enterpise) and cloud (Online Advanced).

Let’s consider insight, scalability, and security.

A. Insight

In insight, Quickbook’s cloud approach lets you form labels, create some balance sheets, build multiple budgets, run custom dashboards, and more. QB’s on-premises version does nothing of the sort. However, the on-premises application does much more than the cloud version: create additional balance sheets, incorporate advanced built-in reporting, perform cashflow projections, forecasting, and more. In other words, Quickbooks claims to give you insight, but there is no way to build everything you need in one product.

 

B. Agility

Scalability seems guaranteed for a cloud victory. After all, QB Online Advanced (cloud) has a smartphone app and complete remote access. Yet the cloud version includes a specific subscription for each company covered (as in, a specific log-in subscription) and prohibits you from viewing multiple companies in one subscription. Ironically, the on-premises option actually lets you see two companies at once.

 

C. Security

One of the reasons many audit firms and venture capitalists distrust QB lies with its audit-edit option. QB has gained a reputation for allowing accountants to edit or customize their audit data. While this only refers to the cloud option, a growing company would need to maintain the on-premises application in today’s fast-changing and post-crisis world.

By now the problem should become clear. QB leads you toward one of two upper-limit systems, neither of which contains everything a business needs for understanding, efficiency, agility, and security. The customer must undergo workarounds and manual efforts to make up for their system needs.

Worse, the highest-tier QB systems struggle to perform beyond their limits. Although one can, theoretically speaking, acquire another user, every additional user strains a cloud system already overloaded with small businesses. Delays, shutdowns, and frustration often result.

 

Disadvantages of an outgrown system

Now, your executives might acknowledge that Quickbooks provides limited options. However, they might think that they can wait, that they can graduate to a full financial system in the near future. Once you hire ten or twenty more people, once you build a full IT and accounting department, then you can broaden your options.

For a variety of reasons, this approach—putting scale before solution—will only intensify the challenges of growth.

 

A. Agility: The Long Game

First, a full financial system demands transformation. A small-business software cannot prepare organizations for the next step. In an ideal world, customers would value the future over the present and select a partnership, not for their current size, but according to their ambitions. Yet even long-term thinking can have short-term benefits. A solution like Xledger can save both in the future and in the near term, from limitless scalability over time to 75% of manual labor recovered after go-live.

 

B. Venture Capital: Secure Funding

Second, Quickbooks bears little stock with venture capital or audit firms. Many venture capital firms reject or require the replacement of QB, which they see as too easy for the organization’s founders to manipulate. But whether seed capital or series B, the funding firms also need to know that their startups can handle a full financial solution, a system both scalable and capable of delivering GAAP financials.

 

C. Insight: More Vital than Ever

Third, insight has reached a fever pitch. Toward the end of 2020, small businesses invested more in insight than large companies. However, too many organizations pair Quickbook-driven financials with dedicated analytics systems, either understaffing the latter or paying for knowledge workers their business can hardly afford.

By contrast, today’s businesses should free up existing financial staff for business intelligence. By finding a tool beyond Quickbooks, these organizations can automate their accounting processes, enabling them to leverage teams effectively trained to deliver insight.

 

 

If you have reached the upper limits of Quickbooks, then you already have some idea of the obstacles and cracks of an outgrown Quickbooks system. If you have not yet reached the upper limits, then take the opportunity and begin your search. Gather a selection team and consider options. In either case, your process will involve some heightened risk. As business moves faster and with less certainty than ever before, know that time might work against as well as for you.

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Xledger empowers you to move beyond small-business applications. We deliver our market-leading automation and powerful BI tools to 10000+ clients in 60+ countries. Whatever your size, Xledger meets your scale and grows with you. We empower you to add new business units and expand across borders while expanding insight into your entire organization.

For more information on moving beyond Quickbooks, please contact us.