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Accounting explained for SaaS companies

Accounting explained for SaaS companies | Cenk Tukel - Tukel INC Accounting

In this podcast episode, we interviewed Cenk Tukel, whose accounting firm provides table stakes, including basic bookkeeping, accounting, tax returns, unlimited HR and payroll services, and advisory services for managing the business. He partners with SaaS companies to check their transactions, remind them of compliance and tax issues, partner with lawyers, and prepare financial presentations for investors. He recommended a one-stop-shop model for US companies that provides all necessary services through partners or directly.

Our guest shared insights on the importance of outsourcing accounting, HR, and investor relations to trusted advisors or partners while SaaS founders focused on growing their businesses. He further noted that maintaining proper financials is crucial for gaining investors or selling a company and avoiding hefty fees or penalties.

Most common accounting mistakes by SaaS companies

Cenk revealed common accounting mistakes by SaaS companies, like booking payout from collection service providers as revenue, which can attract an IRS inspection and incur legal fees. He also discussed crucial KPIs for SaaS companies, including churn rate, lifetime value, error rate, and customer acquisition cost. He recommended monitoring the cash burn rate to signal financial danger and take immediate action before funding dries up.

The episode further explained the importance of addressing cybersecurity data protection insurance and SOC 2 compliance early to protect customer data and avoid legal issues. Cenk emphasized that startups with low or no funding could apply for startup programs and get products for free or at discount rates for two years. He shared examples of SaaS companies facing legal and financial challenges due to neglecting security and legal compliance and ignoring investor management.

Lastly, Cenk shared his experience in the finance departments of PepsiCo for the last 20 years before starting his startup journey. He worked on budgeting, return on investment, and product pricing and managed finance, legal, HR, procurement, sales, and marketing teams. He launched four startups, but only three were successful in technology and e-learning and didn’t generate sufficient revenue.

Overall, the episode provided comprehensive insights into accounting, legal, and financial issues faced by SaaS companies and the importance of outsourcing or seeking professional help.

Podcast Host & Guest(s)

Cristian Dina

Host

Cristian Dina

Managing Partner & SaaS Podcast Host @ Tekpon
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Managing Partner & SaaS Podcast Host @ Tekpon

As one of the founding members of Tekpon, Cristian has worn many hats within the company, but perhaps none shines brighter than his role as the charismatic host of the Tekpon SaaS Podcast. With over 200 SaaS industry leaders gracing his episodes, Cristian's insatiable curiosity ensures he always has one more question. Cristian is a community builder at heart, being the Bucharest city leader for SaaStock Local and the author of the best-selling book King of Networking.

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