Short answer

• Keep AP simple, documented, and automated where possible.
• Use clear roles, a short invoice-to-pay workflow, approval thresholds, and basic controls (vendor setup, approvals, reconciliation).
• Lean teams often combine a credit card-first policy, weekly payment runs, basic AP automation (invoice capture + approvals), and outsourcing for peak load or complexity.

How a small startup typically handles AP (practical blueprint)

1. Capture

   • Invoices sent to a dedicated email ([email protected]) or uploaded to an AP tool.
   • Use OCR / invoice capture to avoid manual retyping (even simple tools shrink effort).

2. Triage & enter

   • One person (office manager/bookkeeper/virtual assistant) checks invoices, enters key fields into the accounting system (vendor, date, due date, amount, GL code, PO/contract ref).

3. Approve

   • Route invoices to the appropriate approver (owner, hiring manager, team lead) with a simple approval matrix (see example below).
   • Use automated routing by amount/department where possible. If email only, require an approving reply or e-sign.

4. Schedule & pay

   • Batch payments (weekly or twice monthly) to consolidate bank/ACH/card costs and reduce admin.
   • Prefer electronic payments (ACH, virtual cards, Bill Pay) for traceability; use cards for small recurring subscriptions to simplify.

5. Record & reconcile

   • Mark invoices as paid in the accounting system when payments go out. Reconcile bank and card statements weekly or monthly.

6. Archive & audit trail

   • Keep scanned invoices and approval evidence attached to each AP record for audits and due diligence.

Roles & options for a small team

• Founder/CEO: approves high-level or high-dollar spends if team small.
• Office manager / operations lead: day-to-day invoice processing, vendor communications.
• Bookkeeper / part-time accountant: coding, month-end accruals, reconciliations.
• Virtual assistant / outsourced AP: low-cost capture, data entry.
• Fractional CFO: policy, approvals, cash forecasting (when needed).

Approval matrix (example)

• <$500: team lead or office manager
• $500–$5,000: department head
• $5,000–$25,000: VP/COO

• $25,000: CEO or board sign-off

Policies & controls you should implement immediately

• Single vendor master file owner — one person creates vendor records, with second-person review for new vendors.
• Two-person rule for changes to bank details (always verify via previously known contact method before changing payment information).
• Approval thresholds (as above).
• Segregation of duties as you grow: the person approving invoices should not be the person cutting payments and reconciling bank statements.
• Require contracts or POs for recurring or large purchases.
• Regular reconciliation of AP aging and bank accounts.

Lean payment strategies to reduce workload

• Use corporate cards or virtual cards for subscriptions and small purchases (reduces invoicing).
• Net terms negotiation (30/45 days) — push vendors for longer terms when cash is tight.
• Consolidate vendors where sensible to reduce number of invoices.
• Weekly or twice-monthly payment runs to batch approvals and bookkeeping.

Automation & tools (what they solve)

• Invoice capture/OCR: cuts manual data entry.
• Approval workflow tools: route invoices, capture approvals, store audit trail.
• Bill pay / virtual card providers: make domestic/ACH/card payments, often integrate with accounting.
• Accounting software (QuickBooks, Xero, etc.): central ledger, vendor tracking, AP aging.
• Concierge/outsourced AP services: handle capture, approvals, and payments for a fee.

(If you want vendor names I can list a short set of popular options — tell me if you want product comparisons.)

Outsourcing and part-time help

• Bookkeeper/fractional accountant: handles coding, reconciliations, month-end.
• Outsourced AP provider: receives invoices, does data entry, runs approvals and payments. Good for rapid scaling without hiring FTEs.
• Virtual assistants: cost-effective for simple capture and vendor follow-ups.

Monthly and weekly checklist (practical cadence)

• Weekly: process new invoices, run payments, clear bank transactions.
• Monthly: reconcile bank and card accounts, update AP aging, post accruals for unpaid invoices.
• Quarterly: review vendor master list, renegotiate terms, audit approvals and controls.

Metrics to watch (even for tiny teams)

• AP aging (0–30, 31–60, 61–90, >90 days)
• Days Payable Outstanding (DPO) — how long on average you take to pay vendors
• Invoice cycle time (receipt → approval → payment)
• Number of invoices per AP FTE / week (to plan hiring or outsourcing)

Scaling signals — when to hire or change process

• If invoice volume > ~150–200/month or AP becomes a regular bottleneck or you see frequent payment mistakes, hire a dedicated AP/bookkeeper or outsource.
• If approvals take more than a few days regularly and vendors complain, add automated routing or reduce approvers.
• If you introduce payroll, stock comp, or international vendors, add stronger controls and possibly a full-time finance hire.

Common pitfalls and how to avoid them

• No single place for invoices → missed payments. Fix: central invoice inbox + capture tool.
• Too many approvers for small spends → slow payments. Fix: clear thresholds + delegated authority.
• Changing vendor bank details by email → fraud risk. Fix: mandatory phone verification to known contact.
• Paying vendors manually every day → high admin cost. Fix: batch payments and use ACH/virtual cards.

Simple SOP (one-page template you can copy)

1. Invoices are emailed to [email protected].
2. Operations checks inbox daily, uploads invoice to accounting system, enters vendor, amount, due date, GL code, and tags requested approver.
3. Approver receives link; must approve/reject within 48 hours (auto-approve to CFO if no action after 5 days for certain small-dollar categories).
4. AP runs payments every Tuesday and Friday. Emergency payments require CEO sign-off.
5. Bookkeeper reconciles bank and cards weekly and files invoices in cloud storage with the AP entry.
6. Monthly AP aging report to CFO on the 3rd business day of each month.

Final tips

• Start simple and document it. Complexity can be introduced later.
• Automate the highest-effort tasks first (capture and approvals).
• Keep controls lightweight but effective — the goal is fast, auditable payments without unnecessary overhead.

If you’d like, I can:

• Draft a one-page SOP tailored to your company size and invoice volume, or
• Suggest a short list of tools (capture, payments, accounting) matched to whether you prefer low-cost/manual, mid-range automation, or fully-outsourced AP.