The services startups need from finance professionals

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In 2016, a new startup was born every 45 seconds.

The steady influx of new companies presents enormous opportunities for accountants looking to find exciting new clients. But, as they find their feet, what services do UK startups need from finance professionals?

The open market is a risky arena for fledgling businesses. Five years into trading, only six out of ten new companies still have open doors, according to figures from the Office of National Statistics. Accountants invest in their clients just as much as the opposite is true, and it’s important to be selective to avoid seeing your endeavours go to waste.

Yet, the odds aren’t as daunting as they sound. Small companies account for 99 percent of all private sector businesses in the country. Though plenty burn brief and bright, others flourish, and access to adept business guidance is a major influence in their success. It’s a high-risk, high-reward game taking on startup clients, but with hard work there are ways to stack the deck in your favour.

Growing pains

Building a business can be chaotic. Initial ideas give way to grand ambitions and days are swallowed in flurries of enthusiasm. In all of the excitement and hard work it’s easy for entrepreneurs to neglect the importance of establishing a solid financial framework.

“You’ve got to be prepared to deal with startups as they often present different challenges,” says Peter Czapp, co-founder of The Wow Company, an accountancy firm that specialises in working with startups. “The role often requires intensive support. The more care and attention you can give a client, the closer your relationship becomes, and the more likely they are to recommend and stay with you.”

There are many support networks for startups, but these bodies are typically inundated by the sheer numbers of businesses that come to them for assistance. As a result, the advice they offer is usually not fully personalised to meet individual’s needs. Accounting for startups requires offering bespoke advice to help clients strategise in a way that is tailored to their sector.

“Specialise and pick something you’re strong in,” suggests Czapp. “Because of your passion, you’ll be able to provide insight beyond the accounts that someone who’s not familiar with the industry wouldn’t be able to.”

Back to school

Accountancy firms are perfectly positioned to supply valuable education to startup clients. Handling their financial commitments is fine, but ensuring they appreciate the mechanics of their tax obligations and provisioning for the future is only part of the job. The real value is providing new businesses with experience and insight that will allow them to remain profitable in the long-run. It’s more demanding than working with entrenched companies, but encourages a strong sense of loyalty that can’t be bought through marketing.

There are a variety of tax breaks and funding schemes out there for new startups to take advantage of, such as the Enterprise Investment Scheme which allocates tax relief to money invested in small businesses. By assessing which options their clients can properly leverage, accountancy professionals not only make immediate revenue, but also bring a level of security that inexperienced startups appreciate.

“It’s a completely different world to what they’re used to and if you can guide them through the finances you can be a hero,” explains Czapp. “It’s a great investment because you can get a client for life. You’ve just got to be prepared to put the extra work in.”

Hold on tight

Adaptability is a crucial part of accounting during those early stages of development. Unlike an established entity with a heritage of workflow, the pace of a young organisation can be erratic as they evolve. The primary focuses of the company are liable to morph or even change entirely.

Consequently, accountants must be prepared to make quick adjustments to the business forecasts when changes occur. The best way to be ready is to stay proactive, not reactive. Anticipating the turns of a teething business makes it easier to streamline these transitionary periods.

Changes can range from minute to mammoth, so operational scalability is a useful asset to foster. Most new businesses harbour hopes of making a strong impact on the market. Making sure that you are equipped to scale the services you provide accordingly with their growth is key to retaining their custom.

When businesses soar, their accountants stand to rise with them, provided they are flexible enough. A promising company will thrive or fold on the back of a swarm of variable factors, but sound judgement and dedication in mitigating these factors can give them just enough of an edge to succeed.

Jesse Onslow Norton is a writer, editor and communications consultant at Flibl. A former coder, his editorial work focuses on fintech, digital transformation, policy and regulation. His clients include corporations, governments, startups and SMEs from across the world. Follow him on Twitter @JesseOnslow.

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