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Revenue recognition for YC startups
Did we earn this deal’s revenue yet, or only collect cash?
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The job is to show what was earned this month, even when cash arrived earlier.
Pilot and Economico can both serve an early startup founder; Pilot runs managed accounting, while Economico lets a builder record and inspect the facts with their own agent.
| Decision | Pilot, managed accounting for startups | Economico |
|---|---|---|
| Who does the work | A managed team handles bookkeeping and accounting review. | Your own agents record payment and delivery separately, so you can see when the service was earned. |
| Period revenue | Specialists apply the close process and accounting judgment. | Entries and reports reflect the delivery recorded for each period. |
| Judgment and filings | Managed service includes professional tax and finance support. | Policy-sensitive adjustments and filing-ready output need qualified review. |
Was the payment earned yet?
Record contract terms and the service or usage actually delivered. The accrual entries and recognition report expose the period basis.
Why a paid invoice may still be an obligation
A YC startup can sign an annual software deal, collect the full amount and still owe months of service. A managed accountant such as Pilot can review the recognition policy and close. Economico lets the builder’s agent record the agreed terms, cash receipt and each delivered period so the amount earned can be inspected as work happens.
The decision is not simply whether software can draw a schedule. Someone must identify the promised service, start date, changes to scope and evidence that delivery occurred. Economico can post the declared effects and show the remaining obligation; it cannot substitute for judgment on a novel contract or infer fulfillment from the payment.
Test the awkward case, not the easy monthly plan: a prepayment before onboarding starts, a midterm amendment or a credit. Ask what was earned in the named period and what remains to be delivered.
An annual prepayment before service begins
If a customer pays your YC startup before its software service begins, record the receipt and later delivery as distinct facts. Inspect the resulting liability or revenue instead of treating every deposit as earned income.
The performance obligation needs review
YC status does not remove accounting judgment. Policy-sensitive balances require evidenced adjustments, and filing-ready output is a separate job.
Separate the deposit from earnings
See how period earnings reach the books. Record a prepaid agreement and later delivery separately, then ask what remains unearned.