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Xero -- better than QuickBooks for start-up company?

I see posts about Xero but the posts are two - three years old. Anyone have recent experience with buying and implementing Xero? My client is a start-up health services company with only two employees but a plan to grow to say 50 in two or three locations over the next year. They will likely have three or four different legal entities for physicians providing services in different states within the next year. QuickBooks was my first thought but have heard some good things about Xero. Anyone?


Topic Expert
Wayne Spivak
Title: President & CFO
LinkedIn Profile
(President & CFO, |

I like Xero. I use Xero. Whether it is the right choice for you is another matter altogether (too many variables and not enough information in your post).

But before you pick any system you need to know where you think you'll be in the mid and long term and plan accordingly or at least realize that you will end up implementing another system I. The near future; a costly and time consuming process.

Topic Expert
Kent Thomas
Title: Founder
Company: Advanced CFO Solutions
(Founder, Advanced CFO Solutions) |

Wayne is correct. Xero is a solid, cost-effective system for a small business, however, think about three things before you decide which system to start with: 1) Does the software give me everything that I need now and as I grow? (e.g., can I track project costs, revenue and costs/expenses by customer, product, sales or distribution channel, etc); 2) How far can this software take me (i.e., what level of transactions or customers or revenue growth will it let me grow to before I have to change?); and 3) "What's next"? (e.g., when you make the move to another ERP system, how easy or difficult will it be to get the data out? What system looks like it will be the best fit in the future).

If any of this is beyond your expertise or knowledge, find a knowledgeable advisor who can help you make a good decision now that won't hurt you in the future.

Len Green
Title: Performance Improvement Consultant and E..
Company: Haygarth Consulting LLC
LinkedIn Profile
(Performance Improvement Consultant and ERP Strategist, Haygarth Consulting LLC) |


Given your client's plans to grow, especially with separate legal entities, may I suggest a brief discussion on Intacct. You can start small and grow with it, and it's natively designed to support growth that involves multiple entities, locations, practitioners, etc (e.g. in retail healthcare the business model often involves many legal entities, intercompany (entity) transactions and due to/from reconciliations and integration with the practice management software used at each location).

Intacct does not force you to log off one company and then log on to the second, it automates the intercompany transactions and it provides out the box multi dimensional reporting, both entity level and consolidated.

When you consider the value of scaling (avoiding staff increases), faster, easier closes and built in management reporting, it may be worth taking a look.



Nizard Djemmali
Title: CFO
Company: Azalead
(CFO, Azalead) |

Hi Len, thanks for your post on Intacct. I am currently reviewing Intacct for my company. We are a saas software editor based in Paris and planning to expand to the us, uk... in the next year. Implementing an accounting software is not an easy project and I have a lot of pressure as the CFO of my company to make it smooth, efficient, cost effective and scalable for my growing company. I will be happy to know more about te solution, especially when it comes to handling local specificities, French, US,... I would also like to get your insight on the implementation process as for all start-ups I am the only finance headcount on my payroll and I would like to assess whether I will be able to handle this project alone or with extra ressources. Finally, information regarding their customer support would be key as I know that we often find surprises while rolling out an accounting / finance solution. I understand that we would be the first French company to go for them and I would like to make the best choice. Thanks!

David Dobrin
Title: President
Company: B2B Analysts, Inc.
(President, B2B Analysts, Inc.) |

I agree with Len. If you're managing multiple legal entities and you need to do cross-entity reporting or transactions on a frequent basis, Intacct can definitely be a better choice. The choice, however, comes with definite downsides, which you need to be aware of.

Jeff Durbin
Title: Chief Financial Officer
Company: F. Gavina and Sons, Inc.
(Chief Financial Officer, F. Gavina and Sons, Inc.) |

We use Oracle for our main business but a couple small side businesses run on Sage and I'm not thrilled with it.

Jeff Durbin
Title: Chief Financial Officer
Company: F. Gavina and Sons, Inc.
(Chief Financial Officer, F. Gavina and Sons, Inc.) |

No one has mentioned it (unless I missed it) but QuickBooks Pro scales up with QuickBooks Enterprise.

I am not thrilled with QB's habit of dropping support for old versions after a few years but it is always easy to find someone with QB experience. That can be valuable when you are considering future staffing.

Steven Lange
Title: Senior Operational CFO
Company: Accounting Management Solutions, Inc.
(Senior Operational CFO, Accounting Management Solutions, Inc.) |

As an operational CFO, user and implementer of many of these systems including Xero, Intacct, Netsuite, QB etc I think there are many that would agree that there is no perfect solution and each has pros and cons. I agree very much with prior comments that a thoughtful and methodical approach to an implementation is key to success. Feel free to message me privately if you would like some personal insights.

James Scott
Title: Consulting CFO
Company: Early Growth Financial Services
LinkedIn Profile
(Consulting CFO, Early Growth Financial Services) |

Start cheapest, move up later. Maybe spend some time to investigate how easy it is to export all of your transactions from whatever system you start on to whatever the more mature health services companies are using in your industry. Xero and QB probably suffice.

Topic Expert
Keith Perry
Title: Director of Global Accounting
Company: Agrinos, Inc.
(Director of Global Accounting, Agrinos, Inc.) |

Echoing a lot of the prior;
Xero is fantastic, cheap, easy, and has a really big plus: they're focused on partners and open APIs. This means, for example, instead of having consolidations baked in, you use a Xero partner (like Fathom) for consolidated planning, KPIs, reporting, tax, etc. Using Xero means "do your homework" on the partner apps appropriate to your business (inventory, timecards, etc) before implementing. They are (apparently) deliberately avoiding stepping on partner developer toes. This means they've got the best ecosystem in their class.
QB is catching up. They are less partner friendly, less open, etc. That being said, if they fit your needs, it scales pretty well, and the modules you need are mostly already there.
Sage and Intaact are both much more robust. They are designed to be more customizeable. That means investment, but it also means a more scale-able solution. I've had to migrate companies off of Sage because they do tend to trail in the partner arena, but if you don't have early-adopter needs, they could be a good fit.
Finishing with a shout out to Mr. Scott; you likely don't know what your GL and processes are going to look like a year from now if you are growing rapidly. Take the easy path (Xero, imho), and then as you scale past that, migrate over time. Migration from Xero is, happily, incredibly easy, especially compared to the competition, so you won't have over-invested and won't be trapped.

A last comment: I'm a big fan of the decentralized model. The next time a cool new app comes out (lets say, automated sales tax optimization, rev rec, sales force comp...make a list), it won't come from any of the major players. It will come from someone trying to be disruptive. The less "shrink-wrapped" your GL is, the more likely it will be that you'll be able to adopt the new software.

Mark Jackson
Title: Controller
Company: None
(Controller, None) |

I can speak to the utility of setting up Xero but have limited experience on the Quickbooks side. The embedded tax tables in foreign entities (UK and AUS) were simple to use and easy to ramp up for a SaaS based revenue company. Based on the healthcare business I believe you could set up item codes to facilitate invoicing for most any billable item. When it comes to other forms of revenue recognition i.e, subscription revenue there are limitations. The cash reconciliation and vendor payment modules are straightforward and intuitive. In terms of consolidations and viewing activity in multiple entities it's easy to view and pull data out of the multiple entity structure but rolling up into a consolidated set of financials can be difficult with the off the shelf product.

Mandy Calder
Title: CFO
Company: Miss CFO
(CFO, Miss CFO) |

The benefit of Xero is that it is fully cloud based as was developed as such from the start. A lot of the other accounting packages such as quick books have work arounds so that they can be used on the cloud but they are not properly cloud based.

Xero is very good at taking feedback and developing their software in accordance with user's wish lists and respond quickly to queries. The online tutorials make it very easy to learn the features.

I particularly like the multi currency and payroll features and the tracking option works well for me as I have to track costs against projects. A lot of developers are developing bolt on packages too so you can get quite specific with your requirements

I understand that they are about to go live with a Spanish version too and will be developing other languages in the future.

I think it will overtake Quick Books in the US in the next year or two

Topic Expert
Wayne Spivak
Title: President & CFO
LinkedIn Profile
(President & CFO, |

This post is a little old, but Xero has done quite a bit in the upgrade department.

From a very expansive API to new reports and report generator. They also have increased the number of 3rd party add-ons.

It deserves a second look at least.

Michael S Tan
Title: Director of Finance
Company: Unbounce
LinkedIn Profile
(Director of Finance, Unbounce) |

If you are anticipating startup hypergrowth, Xero is the way to go.
I've been thru 1000% revenue growth over 5 years in two different companies and Xero has worked at both.

I am utterly amazed at the new reporting that Xero dropped in August 2016. It has made my life so much easier to put together both management reporting and financial reporting.

The 3rd party connectors are life savers.
Xero is leaps and bounds above QB.

QB Enterprise, at least 3 years ago (2013), was utterly useless and wass deceitful in branding itself as 'Enterprise' grade.

With entity consolidation being handled with 3rd party connectors, Xero will be in my life for quite a long time, especially since Xero costs less than $500 USD per year (unlimited users) vs Netsuite or Oracle for $10k a year, plus $1200ish per additional user.

Xero for life.

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