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6 Things SaaS Founders Need To Know About Accounting

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I didn’t want to shoot this video.

Honestly, I didn’t even think it was necessary.

I assumed that all scaling SaaS founders must be doing accrual accounting, right?

But I soon discovered about 15% of those that I coach were using cash accounting, and they weren’t clear on the difference between deferred revenue vs accrued revenue.

…or why it matters.

Don’t worry, I’m not pointing fingers.

Over the years, I made almost every business mistake there is, so there’s no shame or judgement here.

But today I want to sell you on what accrual accounting is, WHY your accountant should be doing it…

And how it will set up your SaaS company for success.

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In this video, I’m going to give you the perspective of an entrepreneur, a CEO, or a founder… NOT an accountant. You’ll learn:

  • Why lots of SaaS founders start with cash accounting
  • Deferred revenue vs. accrued revenue
  • How to move to accrual accounting
  • Why it will make you financially rock-solid
  • How it can save you from overpaying taxes
  • What bookkeeping software will do it for you

“But Dan, I pay an accountant so I don’t have to think about this stuff.”

So do I. 

For every company I’ve ever started, I had accountants… and I’ve learned more about accounting than I ever wanted or planned to.

But you need to know that your business isn’t a leaky bucket of profits and that you’re optimized for scalable growth. That means knowing some high-level accounting principles.

It’s like eating vegetables. They might not be as tasty as chocolate, but trust me – it’s good for you.


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