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Pre-seed

Bookkeeping for pre-seed startups

At pre-seed the job is not sophisticated accounting. It is a clean foundation that will not have to be unpicked in a year.

Parag Jain, CPA
Parag Jain, CPAFounder, Zinance·Last updated August 2026·5 min read
Summarize this article

At a glance

Basis
Cash is usually fineAccrual can wait until revenue is real
What matters most
Separation and evidenceCompany money kept apart from personal, receipts kept
The expensive mistake
Late 83(b) electionA 30-day window with no remedy after it closes

Pre-seed bookkeeping is mostly an exercise in not creating problems. There is little revenue to recognise and few transactions to categorise. What there is, is a set of decisions made in the first year that either hold up under seed diligence or cost real money to fix.

The 30-day window nobody gets back

If founders hold stock subject to vesting, an 83(b) election must be filed within 30 days of the grant. Miss it and you are taxed as the shares vest, on the value at each vesting date, which for a company that works out is a very large bill for money you never received.

There is no late fix

This is not like a missed filing that can be caught up with a penalty. The window closes and the election is gone. It is the single most expensive thing a pre-seed founder can forget, and it happens because at the moment it matters, nothing feels urgent.

Keep the money separate

A dedicated business bank account from the day the entity exists. Not because it is more organised, but because commingled personal and company spending is the thing that makes a later clean-up expensive — every transaction has to be re-examined by someone who was not there.

Cash basis is fine for now

  • Cash basis — record it when the money moves. Adequate at pre-seed and much cheaper to run.
  • Accrual — record it when it is earned or incurred. Needed once revenue is real, and expected by the time you raise a Series A.
  • The migration between them is straightforward when the underlying records are clean. It is expensive when they are not.

What we do for pre-seed companies

The foundation: entity and equity hygiene, a clean chart of accounts that will still make sense at Series A, monthly categorisation, and runway you can actually see. Flat pricing, and the books belong to you.

Frequently asked questions

Do we need a bookkeeper before we have revenue?+
You need clean records, which is not the same as a full accounting function. The cost of doing it properly at pre-seed is small; the cost of reconstructing a year of commingled transactions before a seed round is not.
What is the 83(b) election and why the urgency?+
It elects to be taxed on restricted stock at grant rather than as it vests. It must be filed within 30 days of the grant and there is no late remedy. Miss it and you are taxed on the value at each vesting date, which can be enormous if the company succeeds.
Cash or accrual at pre-seed?+
Cash is usually fine and cheaper to run. Move to accrual when revenue becomes real or when you start preparing to raise — investors at Series A will expect accrual.
New YorkNew YorkOutsourced bookkeeping for New York companies, with the city and state filings that catch founders out built into the close.San FranciscoSan FranciscoOutsourced bookkeeping for Bay Area companies, built around California's minimum franchise tax and San Francisco's gross receipts regime.AustinAustinOutsourced bookkeeping for Austin companies, with the Texas franchise tax report handled even in the years you owe nothing.

Numbers you can actually trust

Zinance is outsourced bookkeeping, tax, and fractional-CFO support built for fast-growing companies, flat pricing, a dedicated human, and books that stay current every day.

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