Free online software accounting services

Image representing Wave Accounting as depicted...

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Toronto-based Wave Accounting thinks it can run a profitable business without charging customers a cent for its full-range of online software accounting services.

Friday’s announcement of the $5 million in Series A financing round, led by Charles River Ventures (CRV), with the participation of OMERS Ventures, is definitely a hopeful sign for the Canadian startup. This round comes on top of a $750,000 in funding obtained from the Federal Economic Development Agency for Southern Ontario in September.

Wave offers its services at no cost to its customers, so how does it monetize its services? It generates revenue by offering sophisticated, ultra-targeted advertising and group-buying opportunities.

Once the customer is logged into its Wave account, a screen labelled Business Savings is featured. This featured page offers at discounted prices services from other companies. The customer is asked to choose from a range of paying services,  ranging from business cards, Web hosting, to credit card processing services and more, at a discounted price.  If the customer chooses to take advantage of any of these opportunities, Wave Accounting gets paid a percentage or call it a commission, by the supplier.

Advertising partners who have signed up to date include giants, such as American Express, Dell and Grand & Toy, among several dozen.

With no shortage of online accounting software on the market right now, from QuickBooks Online Accounting Software to Sage Peachtree, all offering free basic package, or free trial to its customers, can a business survive a free business model? Kirk Simpson, President and CEO, believes that they can.

via Wave Accounting raises $5 Million