Since its start in 2020, Pawp has revolutionized pet care with its 24/7 digital health clinic, offering unlimited veterinary consultations via video and text. Recognized by Business Insider as the best online pet care service, Pawp ensures that expert vet advice is always just a tap away. From the outset, Pawp chose QuickBooks Online for its accounting needs, a decision that Tony ElTen, the Financial Officer at Pawp, reflects on positively: "We’ve been on QuickBooks Online since the very beginning, and it’s been a pleasant journey overall. With my accounting background, I've felt very comfortable using it for our day-to-day workflows."
Challenges of subscription management
As a rapidly growing company, Pawp found itself diversifying its offerings. When they introduced yearly subscriptions alongside their monthly plans, the complexity of managing these through payment platforms like Stripe and PayPal increased. The subscription shift required a deeper focus on accrual and cash flow-based accounting, particularly as the volume of transactions grew. "Before automation, I used to handle monthly manual revenue recognition based on PayPal and Stripe statements, which I then reconciled manually to an Excel sheet," EITen explains. This manual process was soon overwhelmed by the scale of operations.
Integrating Synder for enhanced QuickBooks functionality
To streamline their financial processes, Pawp adopted Synder, a cloud solution that integrates with QuickBooks Online and offers data synchronization from Stripe to QuickBooks. This integration was crucial for automating the revenue recognition of subscriptions processed through Stripe, which kept QuickBooks Online as Pawp’s single source of truth for all subscription and accounting data.
Benefits of the Synder-QuickBooks Online Integration
With Synder, Pawp automates the sync of subscription changes from Stripe directly into QuickBooks, including refunds, chargebacks, cancellations, and upgrades. This not only saves significant time but also ensures accuracy in financial reporting. Synder's RevRec add-on, compliant with GAAP principles, allows for a straight-line revenue recognition method, distributing the revenue from annual subscriptions evenly from month to month.
Granular reporting and strategic insights
One of the standout features of QuickBooks integrated with Synder is the capability for detailed and granular reporting. This functionality has been invaluable for Pawp, enabling them to map accounts and items from QuickBooks Online to those in Stripe for more transparent reporting. "This integration allows us to track income by categories and understand monthly earnings per product through our Profit and Loss statements," EITen notes. Additionally, their balance sheet accurately reflects deferred revenue for subscriptions, indicating the amount received but not yet recognized as income.
A Future-Proof Solution
The synergy between Stripe and Synder integrated with QuickBooks Online has created a robust framework for Pawp, automating their revenue recognition process and significantly reducing manual workload. This efficiency allows Pawp to reinvest time and resources into expanding and enhancing their services. Andrew Malek, Founder and CTO of Pawp, emphasizes the importance of this integration:
