Building Your CFO Tech Stack: What Software to Use

February 26, 2018 Shareworks Marketing

We live in a world of software. Software to pay your bills. Software to reimburse employees. Software to manage your payroll. And while that may seem like everything is simplified, we are now faced with the challenge of making all these software platforms talk to and with each other and creating an ecosystem of tools that actually make our jobs easier. So where do you start?

We started by reaching out to our network and asking CFOs and finance professionals to tell us what financial software they’re using and how happy they are with their products. Then we made this report you can download and wrote this article to help you build your own stack.

Survey Results Included: Download the complete survey results to see what other CFOs are using in their stacks and how satisfied they are with the tools they use.

Building an integrated network of software can feel a bit like the Tower of Babel, with all these programs speaking different languages and focusing on their one specific task. So how do you make a full tech stack that works comprehensively? Well, there are four goals in mind.

  1. Make it efficient.
    • Your stack should save you time and headaches. It should be easy to learn and quick to connect with other programs.
  2. Make sure they work well together.
    • Each element in your stack should “play nice” with the other elements. Increasingly software needs to integrate well with other key pieces of your technology infrastructure.
  3. Your data is your data.
    • Make sure to choose systems that allow you to get your data back out if you decide to move in a different direction in the future.
  4. Future proof.
    • The CFOs we talked to generally indicated it’s better to spend a bit more now to get a system that is going to serve you well in the future rather than try to save every single penny. Increasingly software is a core part of your company, so choose wisely.

The Finance Stack

Just by way of definition, when we talk about the finance stack, we’re referring to the combination and configuration of software that CFOs use to do their jobs. How you set it up will vary depending on your business, but the basic finance functions are mostly the same in any situation. We’ve broken out the major components of the stack into six categories, listed below.

Oops, this image isn't displaying properly.

We ranked satisfaction on a scale from very satisfied to very dissatisfied and then assigned each ranking a numeric value out of 100.

We’ve called out the most common tool in each category, according to our survey results, to give you an idea of where to start. We also listed the tools that ranked highest for satisfaction. How did we score satisfaction ratings? Glad you asked.

We recorded over 200 responses from our network of CFOs and finance professionals. We asked them what tools they use and how satisfied they are with each one, ranking them on a scale from Very Satisfied to Very Dissatisfied. We gave each rank a numeric value out of 100. Then we averaged the responses to come up with a total satisfaction score for each tool.

 

Accounting & Budgeting

Accounting software has been around for a long time, and there are quite a few programs that do the job well. Quickbooks, the most popular platform in our survey, is generally a good solution for any small- to medium-sized business. It’s very robust with a pretty large app store that allows you to connect Quickbooks to other software programs. However, the quality of these integrations varies by app, so you might want to feel that out before committing. Most integrated apps have reviews that can give you a decent idea.

There are also a couple newer apps that have a more modern and intuitive interface like Xero and FreshBooks. Xero proved to be the second most popular response from our survey; however, the gap between Quickbooks’ popularity and Xero is considerable, as Quickbooks topped our list with 59.2 percent and Xero followed in second place with 16.4 percent.

What’s interesting is how Quickbooks and Xero stack up (get it?) in terms of satisfaction. Quickbooks may have had far more responses than Xero, but Xero beat them approximately 81 percent to 73 percent in the satisfaction score.

  • Most Common: Quickbooks
  • Highest Satisfaction Rating: Xero

Payment Processing

Efficiently collecting and accounting for money from clients is a core business function, so your payment processing software is a critical component of a full stack. That said, which software you choose will largely depend on the needs of your business.

Stripe is a great choice for SaaS companies; it’s extremely developer friendly and flexible in how you integrate it with your platform. Square works great for small to medium-sized businesses that need point of sale (POS) solutions. Shopify is an ideal solution for eCommerce businesses; they have a powerful platform for building an online shopping experience, as well as POS offerings for retail locations.

If you’re looking for a more full-featured subscription management platform, check out Chargify, Recurly and Chargebee. These software platforms provide a host of features to help SaaS companies easily setup and manage recurring billing with analytics, lifecycle management, dunning, churn prevention and syncing between other platforms like Quickbooks, Xero and Salesforce.

Despite the number and variety of payment processing tools on the market, the majority of our survey respondents wrote in their own answer, primarily saying they use a bank to manage their payments. Quickbooks and Stripe followed closely behind write-in responses, and once again, Quickbooks lost in satisfaction to a newer app. Stripe had over 82 percent satisfaction compared to Quickbooks’ 67 percent satisfaction as a payment processing tool.

  • Most Common: Quickbooks (in lieu of write-in responses)
  • Highest Satisfaction Rating: Stripe

Payroll & HR

Software specifically designed for payroll and HR gives you a host of features that go above the functionality of accounting programs with payroll offerings, like tools to manage new hires and terminations, taxes and withholdings, employee benefits and more.

For the purpose of the survey, we broke the categories in two, with Gusto taking the top spot in both payroll and HR software. Other popular responses included ADP, Zenefits and Namely. Professional employer organizations (PEOs) like Insperity and Sequoia were common write-in answers.

Payroll Tools
  • Most Common: Gusto (in lieu of write-in responses)
  • Highest Satisfaction Rating: Gusto
HR Tools
  • Most Common: Gusto (in lieu of write-in responses)
  • Highest Satisfaction Rating: Bamboo HR

 Gusto topped both categories independently, making it an ideal solution for a neatly integrated stack. 

Equity Management

Managing the cap table used to happen mostly in Excel for many companies, but as we’ve talked about before, spreadsheets ultimately fail at this task in a big way. Which, of course, is why we built Shareworks Startup Edition.

Software makes it so much easier to issue shares, track vesting, stay compliant and calculate expenses related to equity compensation. Software also makes modeling scenarios like exits and new funding rounds incredibly easy, and startup edition has the best modeling tools on the market. Since CFOs are often tasked with modeling scenarios, our solution makes it a lot easier to do the job and do it accurately.

Based on the survey results, Shareworks Startup Edition was the most popular and highest rated tool in terms of satisfaction with an overall satisfaction score of 80 percent. As businesses grow and managing equity in Excel becomes overly complicated and cumbersome, CFOs will likely look for a dedicated, purpose-built equity management platform. To see more about how our platform stacks up to the competition, click here.

  • Most Common: Shareworks Startup Edition
  • Highest Satisfaction Rating: Shareworks Startup Edition

 

Bills & Expenses

Billing and expensing software adds an extra layer of data and ease to your accounting software. These platforms are designed to handle scanning and submitting receipts, which can save a lot of time and reduce manual entry and the risk for inaccurate data. A couple of the most popular apps are Expensify and Bill.com with Quickbooks Online earning first place for billing tools.

Expense Reimbursement Platforms
  • Most Common: Expensify
  • Highest Satisfaction Rating: Expensify
Billing Platforms
  • Most Common: Quickbooks Online
  • Highest Satisfaction Rating: Bill.com

Reporting & Business Intelligence

Financial reporting is where all your other software applications come together. You need to make sense of all the data you collect so you can analyze it, present it and make informed decisions. Unfortunately, even though this is one of the most important functions, it requires the most manual work and custom implementation. Building reports and running analyses often involves lots of assumptions and inputs that are unique to each business. This makes it difficult for software companies to design a one-size-fits-all solution for calculating forecasts, burn rates, run rates, churn, customer value, acquisition costs, etc.

Excel and Excel-like products dominated this section of the survey but had low satisfaction scores compared to products like Domo. This makes sense given the highly nuanced needs of individual companies. However, there are a few software solutions that can be pretty flexible and powerful when it comes to building reports and extracting business intelligence. Reporting software like Domo, Grow and Tableau can be pretty handy for aggregating your data and getting the insights you need. It’s also worth noting that Excel is the likely choice for early-stage companies trying to keep overhead costs low.

  • Most Common: Excel
  • Highest Satisfaction Rating: Domo

Integrating the Stack

Remember those four main goals we talked about in the very beginning? Your stack should be efficient, easy to integrate, accessible (in terms of data) and future proof. When you go to integrate your stack, it’s important to keep these in mind, because individually, each product will make life more efficient and offer analytics, but all together, you could face integration obstacles.

That said, a lot of these apps have an integration available, the trouble is that they aren’t always as functional as you need them to be. After reading customer reviews and talking with accountants and CFOs, the overall sentiment is that integration is incomplete at best. You can’t automatically connect payments with invoices, correctly categorize expenses, etc…

The truth is, it’s not perfect yet, but it’s getting there. Software platforms are constantly adding and improving integrations, and if you take the time to learn how to configure each of your apps, you can achieve some measure of integration and reduce the required amount of manual labor. Just be prepared for some upfront investment in getting everything to play nicely.

Now, let’s take a look at the full stack according to our survey results.

  • Accounting: Quickbooks
  • Payments: Quickbooks
  • Payroll and HR: Gusto
  • Equity Management: Shareworks Startup Edition
  • Bills: Quickbooks Online
  • Expense Reimbursement: Expensify
  • Business Intelligence: Excel

Gusto and Expensify both have integrations with Quickbooks and Shareworks Startup Edition is building more integrations all the time, just not with Quickbooks at the moment. There’s not a huge need for your equity management platform to talk to your accounting platform, especially since startup edition has built-in reporting, exports, shareholder access and scenario modeling!

If you’d like to learn more about what other CFOs are using in their stacks and how happy they are with popular software programs, please take our CFO survey. This is the survey we used in researching this article, and we’d like to continue gathering data. Once you finish the survey, we’ll send you all the data we’ve collected up to this point so you can get ideas for your own finance stack.

Have an idea of what a full stack looks like for a CFO? Comment and let us know your thoughts!

Survey Results Included: Download the complete survey results to see what other CFOs are using in their stacks and how satisfied they are with the tools they use.

Previous Article
Form 3921 – Who Needs to File, When to Do it, and How to Do it
Form 3921 – Who Needs to File, When to Do it, and How to Do it

So you’re looking for instructions on how to report Form 3921? Well, you’ve come to the right place. In jus...

Next Article
Top 4 Audit Insights from 90+ CFOs
Top 4 Audit Insights from 90+ CFOs

Shareworks by Morgan Stanley recently completed a survey of approximately 100 CFOs about their audit experi...