As a startup founder, you’re likely managing multiple projects and putting out fires 7 days a week. All of this work can make it hard to focus on what’s needed to keep your business running: getting paid!
Many business owners don’t know it’s actually quite simple to start accepting money from willing customers. You can likely start getting paid in just a couple days (or less)!
We’ve put together a guide on what you need to start getting paid as a startup. We’ll also review some of our most trusted payment services to help get your business ready to receive payments in no time.
While most startups likely already have their business set up, it is worth noting for companies just starting out that an online business is no different than any other. You need to be properly licensed and registered.
Below, we’ve put some of the most important state and federal licenses and permits you’ll need to procure before accepting payments from your customers and clients.
Different states have different requirements, but all states require you to have a business license. Most business licenses are renewed annually.
To get your business license you will need:
You will need to register with the IRS to receive an EIN number, which is essentially a social security number for your business. To do so, go to the IRS website and apply for your number. Your EIN number will allow you to get the rest of the necessary registration items, as well as apply for a business bank account.
If you sell goods online, in most states you will need to collect sales tax. Each state has specific requirements, but in every state, you will need your EIN in order to register. Make sure to do this before making your first sale!
If you want to get paid online, setting up a separate bank account for your business is crucial.
Never mix personal and business finances. Keeping these separate will make it a lot easier for you come tax time, and protect you against audits.
When going to your bank to start an account, make sure you have your:
Once you have your business registrations and accounts set up, you’ll need a way to get customers cash into your account. Depending on your business, there are a number of ways to do this. Below, we’ve outlined some of the top options depending on what sort of startup you are running.
These are great for businesses with unique needs and have more of a budget to build out the payment and marketplace sections of their websites.
These options are great for startups needing a payment solution that doesn’t require a shopping cart, such as businesses with subscription models and software as service (SaaS) companies.
Stripe was created with developers in mind. The service was designed to allow for fully customizable integrations into a website via Stripe’s robust API. If you are a developer looking for a fully customizable option, Stripe is probably the best bet for your business.
Pricing is 2.9% + $0.30 a transaction. They also offer an enterprise option with custom solutions for bigger businesses.
WePay is another completely customizable service that allows you to completely tailor your customer’s experience inside your own website. WePay is a great option for larger startups wanting a seamless look on their site, as the service functions as a backend software solution for existing sites.
Pricing for WePay is 2.9% + $0.30 a transaction.
These all-in-one solutions are great options for startups that don’t need advanced capabilities or a custom solution for their payment processing. These services function as free-standing websites so you don’t need to worry about setting up any other service or platform to host your site’s content. They’re also very easy to operate, with very little web training needed to manage.
These services are perfect for businesses selling physical items and need to keep track of an inventory.
Though not as customizable as Stripe and other developer centric-solutions, Shopify still allows a decent amount of customization for an all-in-one service. The service offers a number of templates and plugins to make your page look and feel unique to your business.
Monthly plans range in price from $29-$299 in addition to any additional features you may need.
Much like Shopify, BigCommerce is a great solution for small businesses needing a one-stop-shop for their website and e-commerce solutions. Though BigCommerce offers a number of different themes, customization is quite limited due to the smaller number of plugins they offer. That said, if you need a bare-bones solution that’ll allow you to collect money quickly, BigCommerce is a great option for you.
BigCommerce plans range from $29.95-$249.95, in addition to a custom-quote enterprise option.
When choosing a payment solution for your startup the three most important things to consider are:
While every business is different, we find that most businesses are best served by going with Stripe and Shopify.
Stripe’s API is unmatched in the industry and allows you to customize your startup’s payment process to your exact needs. Shopify, though a templated shopping cart system, is the most customizable solution for e-commerce stores due to their available apps and plugins.
Both offer excellent integrations with Quickbooks and Xero, which is crucial when making sure payments you receive from customers and clients are properly accounted for in your books.
For B2B startups, Stripe, in particular, stands out given its integration with accounting software and email invoicing tools. Staying on top of invoices, and giving your clients the ability to pay for them over email, will let them pay your more reliably.
Intelli Bookkeeping can help you focus on what you do best by acting as your in-house bookkeeping partner. We can make your payment system work for you with our solutions and tools.
Intelli can help with:
Contact us today to find out more about how we can help your startup.