How to choose the right accounting software for your business

Accounting software can feel like a dime a dozen, from big-name platforms like QuickBooks to smaller, more niche products focused on specific industries or business sizes. Frankly, a business can set itself down the wrong path by choosing an accounting software due to popularity or affordability vs. finding one that caters to your business’s needs.

That’s what we will cover in this guide: the who, what, when, where, and how to choose accounting software, and how you can find the right partner to complement your business’s size, needs, and goals.

Choosing software is just the first step; clean, expert-led books matter more.

Why choosing the right accounting software matters

Choosing the right accounting software is a major business decision, up there with choosing your CRM and time tracking tools. Choosing wrong can cost more than just money, but valuable time due to inaccurate or useless data that junks up your workflow.

When problems arise, an inferior accounting software may not offer the requisite customer support you need, causing you to have to rely on less-than-ideal alternatives like Reddit threads and Facebook groups to try and solve the problem(s) yourself.

Many businesses opt for the cheapest or most popular accounting solutions, figuring if it's good enough for a lot of people, it’s good enough for them. The problem is that while that may be sufficient for the bare minimum, those solutions don’t often scale appropriately with your business. When this happens, it increases inefficiency, which can be a death nail for a growing business.

An increase in inefficiency can lead to missed tax deadlines, poor cash flow, and time sunk into trying to solve problems that could have been prevented in the first place, straining your relationships with employees, business partners, and investors.

So many tools are branded and promised to be the full-stop solutions, which sound great, but variances in businesses, management approaches, and regional legislation must be considered. Software is only as effective as the processes behind it. Your accounting software has to be backed by experts who can help you make sense of the organized data your tool provides.

So, in a way, choosing software is only step one of creating a functional, clear, and usable financial environment for your business.

Speak to an Accounting Expert.

What to look for in accounting software

Let’s get down to brass tacks. What should you actually look for when choosing accounting software, if the software alone is only part of the equation?

Well, first and foremost, it needs to cover the basics like:

• Invoicing and payroll
• Generating accurate financial reports
• Categorizing and reconciling transactions

All of these functions are critical to any business, regardless of the vertical or industry. Beyond these core functions is where the nuance comes into play, and where you should consider your specific business’s goals and status.

For instance, an early-stage startup that doesn’t have too much financial complexity, an easy and intuitive tool is generally enough. But, as the business scales, more advanced features like multi-entity support, forecasting, and accrual-based reporting are pivotal. When all of these advanced functions integrate with the core functions listed above, you’re truly leveraging your financial tools to create short and long-term solutions for that component of your business.

Another pivotal factor in choosing accounting software is the decision to go cloud-based vs. desktop-based. Cloud-based tools are touted for their flexibility, real-time access, and collaboration features. They also lean into the new-age remote work environment, allowing flexibility to manage finances with accounting teams from anywhere.

On the other hand, desktop software requires more manual updates, is generally limited to a single device, and doesn’t offer the same level of automation, integration, or accessibility. In 2025, most businesses will require a cloud-based solution.

Your chosen accounting software needs to meet your immediate needs, but also offer the potential to scale as you grow. Look for a cloud-based system that handles your current needs well but offers room to expand. The ideal solution starts with the essentials and lets you add more sophisticated features as your business evolves—without forcing you to switch platforms or lose your financial history along the way.

Match features to your business type

Freelancers and solo business owners

Pilot gives independent professionals clean, tax-ready books without the hassle. Whether you operate as an LLC, S-Corp, or C-Corp, you’ll get automated transaction categorization, invoicing support, and monthly reports you can actually understand. No need to learn accounting—Pilot handles it so you can stay focused on billable work.

Funded Startups

Pilot is built for startups that need investor-ready financials and strategic insights. You get compliant books, burn rate tracking, and support for complex needs like accrual accounting and multi-entity consolidation. For deeper financial guidance, Pilot also offers fractional CFO services to help with runway planning, board reporting, and forecasting.

Product-Based Businesses

Inventory-heavy businesses need accurate COGS tracking and real-time financial visibility. Pilot integrates with tools like Shopify and Amazon, automates reconciliations, and supports inventory-related bookkeeping. This means you get reliable margins, up-to-date balance sheets, and clean data for tax time—without sorting through spreadsheets.

Growing SMBs with Teams and Contractors

Pilot helps service-based and operations-heavy SMBs stay organized as they scale. With support for payroll, 1099 contractor payments, and class- or location-based tracking, you’ll get clear visibility into department-level performance. Pilot also syncs with tools like Gusto, Rippling, and Expensify to centralize your back office.

Each business is different, but Pilot’s managed bookkeeping adapts to fit your model, your goals, and your growth stage.

Comparing the most popular options in 2025

Mistakes to avoid when choosing accounting software

We’ve said it before, but we’ll say it again – don’t just pick an accounting software based on price and popularity. The extra time spent researching different options and considering the needs of your business will go a long way in creating a scalable, long-term solution.

Another major trap to avoid is dismissing the existing workflow of your team and how they like to operate. If a software doesn’t fit existing workflows, then you’re up against relearning a new tool that doesn’t fit the nature of your business. This double-edged sword can greatly escalate growing pains, or worse, set you down a path of inefficiency, mistakes, and cash flow issues.

Most entrepreneurs don’t have academic training in accounting, so it’s easy to misclassify transactions, overlook compliance issues, or have books that may appear clean on the surface but require complex reconciliation underneath.

Accounting software is a tool. Accurate bookkeeping requires humans who know what they’re doing. Just like you can’t buy an oven and expect it to cook dinner, you can’t buy accounting software and expect it to save you money come tax season without the support of expert-led CPA’s who know the tax code inside and out.

Explore Pilot’s Bookkeeping Solutions.

What to do if you’ve outgrown your software?

Outgrowing your accounting software is not a bad thing! It shows your business is growing, and accordingly, needs the requisite tools to keep the growth trajectory pointed in the right direction.

But, how do you know if you’re outgrowing your accounting software? Here are a few clues:

1. You find yourself doing too many manual workarounds. 
2. You can’t generate the reports you require, either from a data or complexity standpoint.
3. A lack of customer support or a lack of knowledge from the support system your accounting software offers.
4. Lack of a real-time data/reporting dashboard. 

When you start feeling these roadblocks, there are a few options available to you.

1. Switch platforms, opting for something more robust.
2. Outsource financial operations to professionals who can manage your books and guide your strategy.
3. Do a combination of both.

For high-growth startups looking at option three, this means pairing your new or upgraded software with fractional CFO services to help blend an enhanced tech stack with budgeting, forecasting, investor reporting, and more.

A great way to start thinking about leveling up your financial systems is by reading our Budgeting Guide for Startups. What you’ll find is that tools like Pilot help provide the best of both worlds for growing small to medium businesses.

Ready to level up your accounting software and the humans that create the processes behind it by switching to Pilot? Talk to an expert today.