So you’ve heard of WaveApps, the accounting software, and now you’re wondering what all of the fuss is about. Is it really comparable to other software like Xero, Freshbooks, or Zoho?
And, as a small business owner, how is it going to make your life easier, if at all?
Before I tell you about WaveApps, I want to remind you that no software is perfect and that many of the suggestions I give are going to be made for accountants and bookkeepers. So they take time to learn.
What’s most important is that you choose one that fits for the size of your business and the type of work you do.
Also, any cloud-based software you choose is going to be a step up from the standard spreadsheet-style bookkeeping.
Overview of WaveApps
WaveApps is free accounting software. It’s cloud-based, which means that it’s online and all of your information is kept on the Internet as opposed to your computer.
It’s free (no, really) and was made primarily for small business owners, consultants, and freelancers. While that price tag can be very kind to your bank account, it also means that you give up features that other software, like Xero or Freshbooks, provide. You’ll see these in the section below about the downsides.
Is it easy to learn?
Yep, Wave is one of the easiest cloud-based software to learn. When you sign up for an account, you’ll be prompted to connect your bank accounts (including PayPal) and credit cards. It works even if you have international bank connections or use a foreign currency.
After connecting your accounts, you’ll be able to track your income and expenses, send invoices, and read reports to see a bigger picture of your money.
You can access reports for:
- Financial – Balance Sheet and Income Statement
- Taxes – Sales Tax and Payroll Wage (paid feature) and Tax Report
- Customer – Income by Customer and Aged Receivables (how much money is coming in and how long you’ve been waiting for it)
- Vendors – Expense by Vendor and Aged Payables (which expenses you haven’t paid yet and how long overdue they are)
- Other – General Ledger (similar to a general overview all of your accounts), Account Transactions, Trial Balance (can see all account balances), Gain / Loss on Foreign Currency Exchange
You can customize all of the reports by date.
What are the downsides?
There are a few downsides to using WaveApps as a small business owner, and I’m going to break them down into three categories: accountant jargon, technical bugs, and Etsy sales.
1) Accountant jargon – To be fair, Wave does a great job of always trying to make things easier for small business owners who aren’t accountants. That being said, there is still a lot of jargon that an entrepreneur would have to learn to be able to make the most of the software. What’s more, if you’re not familiar with how your books should be kept, you often won’t know if there’s a bug or if something isn’t being properly recorded. Mishaps like that could lead to you paying more than you owe in taxes or making decisions based on false information.
2) Technical Bugs – Since it’s a free software, identifying and fixing technical bugs takes a bit longer (2+ days). What do I mean by technical bugs? One I encounter regularly goes like this. Let’s say your balance sheet says there is $100 in your bank account. But when you go to the Transactions screen, you have $90. You then go check the balance of your account, and it’s also $90. That means that somewhere in all your transactions, there’s a mystery $10 difference. In other words, you have a “ghost transaction” that you now have to sift through and find. Even as a trained bookkeeper, transactions like these can take me 1-2 hours to find. Not the best way to spend your Wednesday, right?
3) Etsy Sales – If you sell on Etsy, you’re able to collect sales through Wave, which is great. However, since you’re also connected to PayPal, those sales will be recorded twice. That means your sales numbers will be misleading unless you go through and manually merge the two transactions. That’s also a time suck.
Why should I use it?
1) Better than a spreadsheet – While Wave isn’t perfect, it’s also a major step up from spreadsheet-style bookkeeping. That means tax time will be easier to manage because everything has already been captured and recorded.
2) Free and easy to set up – It’s free and setup is painless, which is great for any entrepreneur who is bootstrapping her business. That being said, it also allows room for growth by giving you the option to invite your accountant, bookkeeper, or team member into the software.
3) Responsive customer service – The customer service is really responsive and attentive. If you’re confused about why your numbers are wrong or how to get rid of duplicate transactions, you can open up a chat box from directly within the software and be connected to someone.
4) Easy to learn – Much of the software, like looking at transactions and invoicing, is going to feel intuitive if you’re tech savvy. If you encounter something tricky or want to learn how to use the software to its fullest potential, there is plenty of information available. You can start with a free series of articles called Wave University.
5) Multicurrency option – With most accounting software, multicurrency is either unavailable or an add-on for a higher-priced subscription. WIth Wave, though, you can invoice and receive funds in any currency, which makes it a lot easier to do business with clients abroad without worrying about the exchange rate.
6) Can save credit card information of clients – Clients can choose to save their credit card information so that each time you invoice them, all they have to do is click “Pay Invoice.”
Quick rundown of WaveApps
- Started doing business in: 2010
- Based in: Toronto, Canada
- Cost: Free
- Credit card processing fees: %2.9 + 30 cents (varies for non-Canadian / non-US countries)
- Automatic billing: No
- Payroll available: Yes ($15 + $4 per employee in the US)
- Multicurrency: Yes
- PayPal payment option: No
- Etsy connection: Yes
- Shoeboxed connection: Yes
- Freshbooks connection: No
- Customized invoices: Yes
- Mobile app: Yes
- Option to collaborate with team members: Yes
Still have questions about whether or not Wave is right for you? Leave a comment below or send me a message.