An honest review:
Collective Accounting Services
This is my honest review of Collective, a financial solutions provider focused on business formation, bookkeeping, and tax support for solopreneurs.
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When I started this adventure into life as a professional novelist, I had to make a few crucial decisions on how to set up the business of, well, me. After some research, I decided the best option would be to create an LLC and opt into S-Corp status. I’m not here to provide business advice, but that is the determination I made for myself and my situation. I also needed bookkeeping and tax support, too.
But, how the heck does one do that? The thought of hiring a bunch of different professionals to do this work and then having to piece it together myself was a little overwhelming. My business needs are not that complex and most options seemed like expensive overkill. Thanks to my search history and the realities of internet tracking, I was eventually served an Instagram ad for Collective.
When I tried to search the web for Collective reviews, I got very frustrated. It annoyed me to no end that I could only find totally glowing or absolute trauma dumps (typically on Reddit) about Collective. No Collective reviews said I wanted to read: this is an adequate service. All the reviews were at the extremes. Sidebar: I could write a dissertation on how 1- and 5-star extreme reviews are ruining everything, but that’s not why you landed here.
So, here is my review of Collective. Spoiler alert: it works just fine for me. Three solid stars, I would recommend.
What I was looking for in a business services software
My requirements didn’t seem too needy, but you’d be surprised how hard it is to find:
An online platform that provides business formation and set-up services, ongoing bookkeeping, and tax support for quarterly and annual requirements.
An easy-to-use interface: so many services are ugly and not intuitive. I didn’t want to dread doing monthly business tasks more than I already do because of bad design.
A reasonably responsive support team. Because I have a day job, I’m not sitting around waiting for immediate support, but I do need responses within 3-4 days.
A reasonable monthly fee.
It’s important to know that my business is relatively straightforward. My income comes from my book deal and the occasional freelance writing. I don’t have diversified revenue streams and I don’t sell products. I’m essentially a service-based solopreneur.
Collective Review: Business Formation
Something I appreciate about Collective is that you do one or two engagement calls before they agree to let you join the service. LLC and S-Corp are not suitable for everyone and I found the questions that Collective asked in these early meetings useful in validating that this was the right path for me.
The business formation process began once I signed up and got access to the platform. Honestly, this initial phase in Collective is 5 of 5 stars from me. I felt informed and educated each step of the way. A lot of this is due to the Collective dashboard that members see. Each step is clearly explained and you can see what’s already been and what comes next. There is an essential order of operations to forming and designating as an S-Corp, and Collective does things by the book to ensure you don’t have issues. Seeing the progress meter was valuable to me because this can vary by state (and Collective doesn’t control how fast or slow this process is).
All of your important documents related to formation live in your document library and are all available to download. While I obviously keep digital and physical local records, it’s nice to know they are there for easy access if I need them.
Collective Review: First Three Months
Collective does decent onboarding and training, but it can be a bit like drinking from a fire hose. As such, I’ll be honest that I spent the first few months a little confused. Part of this was me learning how my business accounts sync to the platform, what the regular bookkeeping cadence is, and what my role in “doing the books” really looks like.
Over a decade ago, I ran a small consulting business, and I was in the weeds on everything. One thing that initially “confused” me about Collective is discovering how hands-off I get to be. I was incorrectly manually adding things to my expenses that didn’t need to be there and trying to work in real-time. This caused challenges on both sides. Over time, I learned that Collective really does handle most of what needs to be done, and I simply need to go in once a month and make sure receipts are uploaded and expenses/income properly categorized.
Something I liked about this phase was how proactive Collective was in ensuring my business expenses from personal accounts were properly recorded into my balance sheet. The reality is that when you start a business, there is often a lot of blending of expenses while you get your official business checking and other accounts sorted. I appreciated that they had an established process for this. However, things have gotten so much easier once everything was 100% handled by my business acounts.
If I had one suggestion for Collective, it would be to have an automated email sequence that goes to new clients at the one-, two-, and three-month marks. These messages could reiterate key, basic points about how things work, and potentially eliminate confusion like mine.
Collective Review: Steady Operations
Recently, I did a call with one of my account success reps. I’d strongly suggest you do the same around month two or three to ensure you are doing things right. In fact, I’d suggest doing as many of these calls as you want/need and hopping on with someone any time you get confused. I wish that I had! This clarified a few points and allowed me to adjust some of my practices and expectations. I could easily book that meeting and secure a time within a week. That feels reasonable.
I’m currently in what I would call a “steady operations” state with Collective. I’ve finally hit a solid understanding of their flow, and with all of my business accounts set up, there is convenient automation in how my accounts work.
Collective Review: What I don’t know yet
I haven’t been through a tax season with Collective yet and I won’t lie that I’m nervous to see how that goes! I don’t want to have to file extensions for business or personal taxes and with a lot of people using their platform, I’m cautious about where I will fall in their priority order. I will update this review when the time comes, but it’s a big reason why this Collective Review has me rating them “3 of 5 stars, would recommend.” If tax season goes well, I will bump that up to a four!
Collect Review: In Summary
To reiterate what I said at the top, Collective is performing perfectly adequately for me. They are excellent at business formation and sufficient for initial and ongoing bookkeeping and training. Time will tell how tax season goes! That being said, I would recommend this to others in a similar position.