Best self-employed accounting software

Self-employed, freelance, or a sole trader? Accounting software could really help your business – here’s our pick of the best.

Our Research

To recommend the best accounting software, our writers and researchers focused on the factors that matter most to small business owners – ease of use, features, design, scalability, and suitability for the UK taxation system.
Written and reviewed by:

Startups.co.uk is reader supported – we may earn a commission from our recommendations, at no extra cost to you and without impacting our editorial impartiality.

As we approach the upcoming new tax year in April 2024, now is the ideal moment to set up accounting software, ensuring you start the new year’s records at the right point and avoiding the hassle of transferring records midway through the year. Beyond simply tracking finances, self-employed accounting software can help you manage your accounts on the go, create invoices, keep track of your cashflow, and easily handle your expenses – all crucial business needs, particularly during our current economic climate.

Our expert researchers determined that the best accounting software for self-employed individuals is QuickBooks, thanks to its intuitive interface and simple templates to help you process common tasks. They are also currently offering 75% off for 6 months, giving you a great value way to try the software.

But with so many options out there, it can be hard to know how they stack up against each other, and which is the right choice for your business. Read on for our reviews of the best self-employed accounting software to help you spend less time keeping track of your bills, and more time actually running your business.

Best self-employed accounting software at a glance

Don’t miss out – we’ve spotted some excellent deals on accounting software that freelancers and sole traders can snap up:

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QuickBooks

FreshBooks

Sage

Xero

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£15 per month (excl. VAT)

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4.7
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4.6
Free Trial
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What is accounting software?

Accounting software is a computer program or application designed to manage and streamline financial processes within a business. It is used by companies of all sizes to record, process, and track financial transactions, generate financial statements, and perform other accounting-related tasks. According to Intuit, most business owners save around 8 hours a month on their accounts – even if you use free accounting software to get started.

Accounting software automates many manual and time-consuming tasks involved in financial management, such as recording sales and purchases, managing accounts payable and receivable, payroll processing, inventory management, budgeting, and generating financial reports. Businesses that use accounting systems have five times more customers than businesses that don’t, according to GoRemotely.

It helps business owners maintain accurate and up-to-date financial records, improve efficiency, reduce errors, and obtain valuable insights into the financial health of their businesses.

Making Tax Digital: considerations for April 2026

The Making Tax Digital (MTD) legislation came into effect on April 1 2022. Since that date, all VAT-registered businesses – including those that are voluntarily registered – are now required to store their VAT accounting records digitally, using HMRC-recognised accounting software.

But soon HMRC will be expanding this regulation further: the government plans for it to become relevant to all self-employed people with gross income of over £30,000 per year (HMRC is still deciding how the rules will apply to people who make less than that).

Due to be introduced in phases from April 2026, Making Tax Digital for Income Tax will require businesses to submit quarterly income and expenses reports to HMRC (compliant accounting software should be able to generate and send these automatically), and submit ‘end of period statements’ at the end of the financial year to replace Self Assessment tax returns.

Why are we mentioning this now? Well, some of the accounting software on this list (namely QuickBooks, Sage, and Xero) is already compliant with this rule, meaning the decision you make now could be a smart move that will save time and effort when the 2026 deadline approaches.

Best self-employed accounting software: our top picks

We’ve been helping small businesses for over two decades. In that time, we’ve carried out extensive research into the best accounting software, informed by our knowledge of the specific pain points and desires of SMEs. Our top picks for self-employed people are QuickBooks, Freshbooks, Sage Business Cloud Accounting, and Xero – and we’ve determined the best based on factors such as functionality, pricing, and customer service.

Quickbooks – best for doing your tax return

4.7 out of 5
  • Bookkeeping
    5
  • Advanced Features
    4.5
  • Financial Reporting
    5
QuickBooks pros
  • Already compliant with Making Tax Digital for Income Tax
  • Extensive feature offering at a competitive price rate
  • Enables users (on all tiers) to easily create cash-flow projections
  • Minimises admin work by providing document scanning (receipts and bills)
QuickBooks cons
  • Accounts payable functionality unavailable on cheapest tier
  • Inventory management restricted to highest tier
  • Budget management tool restricted to highest tier

Recommended plans:

QuickBooks features

QuickBooks is one of the big players when it comes to accounting software in the UK, and its unrivalled features for sole traders and freelancers makes it a very strong contender when it comes to the best self-employed accounting software.

QuickBooks might not offer as extensive a customer service provision as Sage Business Cloud Accounting does, so if you’ll find comprehensive assistance crucial, consider Sage. However, QuickBooks excels in simplifying tax return processes, a feature not as prominently highlighted on the other accounting platforms, making it an optimal choice for streamlined tax-related tasks.

Where QuickBooks really stands out is its tax planning support. Unlike with some of the other options on this list, you can:

  • Separate personal and business expenses
  • Track mileage
  • Automatically view income estimates
  • Easily get all the figures you need when it comes to submitting your self-assessment tax return

These features come on top of a very capable business accounting package. Even the most basic plan comes with:

  • Unlimited invoicing
  • Report creation tools
  • Bank account integration
  • The ability to snap your receipts on the go, and have the data automatically extracted

QuickBooks accounting dashboard

It’s good value too – the base self-employed plan has a standard cost of just £10 per month (exc VAT), making it one of the cheapest plans out there.

This should be ideal for most self-employed people, but if you are registered for VAT, then you should upgrade to the Simple Start plan (£14 per month exc VAT), as this lets you easily prepare and submit your electronic VAT declarations. You even get SmartScan, a clever bit of error checking tech that will check whether any of your VAT codes are unusual (i.e. possibly wrong) or duplicates. Simple Start also lets you quickly create quotes and estimates, and supports Construction Industry Scheme (CIS) contractor and sub-contractor deductions.

The only thing to really fault QuickBooks on is its support options. The £10 per month self-employed plan only offers online chat support, and while the hours for this are generous (7am to 10pm Monday to Friday and 8am to 8pm on weekends), it might not be ideal for some self-employed people. Of course, there are lots of resources available through the website, but in terms of actual one-to-one assistance, you might not be able to get help when you really need it.

The £14 per month Simple Start plan adds phone support, but with similar conditions. This is available 8am to 12am Monday to Friday and 8am to 8pm on weekends, which is again generous, but not 24/7.

QuickBooks pricing

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Self Employed

Plan

Simple Start

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Essentials

Plan

Plus

Plan

Advanced

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Cost
Cost
Cost
Cost

Verdict

For most people, QuickBooks is the perfect self-employed accounting software, with a very strong base package elevated by specialised tax planning support for sole traders and freelancers. It’s reasonably priced, and has a strong track record, having been available in the UK since 2011. The only thing we’re less keen on is the slightly limited support on offer, but even this shouldn’t be much of a problem for most users.

To learn more, check out our in-depth QuickBooks review.

Freshbooks – best for impressing your clients

4 out of 5
  • Bookkeeping
    4
  • Advanced Features
    3.6
  • Financial Reporting
    4.4
FreshBooks pros
  • Priced slightly cheaper than competitors
  • Enables users (on all tiers) to track their billable hours and add them to invoices
  • Provides inventory management on all tiers
FreshBooks cons
  • Does not provide any budgeting or cash-flow projection tools
  • Client limit is only lifted on their third tier at £27 per month
  • Accounts payable functionality only available from third tier at £27 per month

Recommended plan

FreshBooks features

FreshBooks began life in Canada in 2003, but has recently made a strong push in the UK, including adding its first Making Tax Digital (MTD) VAT integration in 2020. It’s a strong overall package, but what we really like is its invoice and estimate creation tools.

Freshbooks (best self employed accounting software)

FreshBooks invoice creation feature

While most accounting software offers this, it’s been a key priority for FreshBooks for years, and this focus really shows. There’s a wide range of colours available, and it’s easy to import your own graphics, meaning you can very quickly produce invoices and estimates that perfectly reflect the tone of your self-employed business.

FreshBooks also stands out with impressive client interaction tools, which are less emphasised in competing platforms, making it an excellent choice if you’re keen to leave a remarkable impression on clients. Nonetheless, FreshBooks doesn’t provide the same depth of features for extensive business scaling as Xero, making Xero more suitable if you’re planning for fast growth.

FreshBooks’ base plan, Lite (£15 a month exc VAT), also includes some really useful features for sole traders and freelancers. You’ll get:

  • Unlimited time tracking
  • Unlimited expenses
  • Mobile mileage tracking
  • Unlimited estimates
  • Reporting tools
  • Bank account integration
  • The ability to easily create VAT reports that can be submitted directly to HMRC with a click

The real downside is the five client limit on the Lite plan. FreshBooks advises that this refers to “the number of both active and archived clients in your account”. However, “if you’re no longer billing or working with a client, you can delete them to free up spots for new clients”, and retain access to their invoices and information. You are also able to delete and undelete clients as you wish.

How much this impacts you will, of course, depend on how many clients your business has – but it feels like a rather strict limit given the monthly cost. The other option is to upgrade to the Plus plan, which costs £25 per month (exc VAT) and limits you to 50 billable clients per month.

In terms of support, FreshBooks does offer phone assistance alongside the resources on its website. However, this seems to operate on US business hours – meaning it’s only available from 1pm to 1am GMT – so make sure you bear this in mind when choosing the right self-employed accounting software for your business.

FreshBooks pricing

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Verdict

Freshbooks offers some of the best invoice and estimate creation tools around, and all its plans include advanced features like time tracking, mileage tracking, and MTD VAT support. As long as you can stay within the five billable clients per month limit (or can afford to upgrade), then it could be the perfect self-employed accounting software for your business.

To learn more, check out our in-depth FreshBooks review, or find out: how does QuickBooks measure up to Freshbooks?

3. Sage Business Cloud Accounting – best for customer service

4 out of 5
  • Bookkeeping
    3.5
  • Advanced Features
    4.5
  • Financial Reporting
    4
Sage pros
  • Already compliant with Making Tax Digital for Income Tax
  • Provides users with a cash-flow projection tool
  • Provides a 24/7 customer service phone line
  • Does not set a client or invoice limit on lowest tier
Sage cons
  • Does not provide a project accounting functionality
  • Users on cheapest tier cannot enable their accountant to use the software
  • Inventory management restricted to highest plan

Recommended plan

If you’re less confident with accounting software, then Sage Business Cloud Accounting is a strong option. 53% of accountants use cloud-based technology to enhance project management functions and improve communications, according to Fundera. Everything is arranged clearly and logically, plus there’s 24/7 support via phone and live chat, so there’s someone there to help whenever you need it.

An image of Sage's accounting dashboard

Sage’s accounting dashboard

Sage features

With Accounting Start, you get a solid basic package. This lets you:

  • Create and send invoices
  • Track what you’re owed
  • Automatically reconcile your bank accounts
  • Create and submit MTD VAT reports to HMRC

However, if you need to work out Construction Industry Scheme (CIS) deductions, then you’ll require the £28 per month (exc VAT) Accounting Standard plan. This also grants you the ability to:

  • Run advanced reports
  • Send quotes and estimates
  • Forecast cashflow
  • Manage purchase invoices

And that’s it, unfortunately. No matter which plan you pick, you won’t get any advanced features like mileage tracking, and the ability to import expense receipts by snapping them on your phone is only available as an optional extra.

Where Sage really shines, though, is its customer support. On all plans, you get 24/7 help via both phone and live chat, as well as a comprehensive suite of instructional videos and online guides.

Exceptional customer service is a standout feature not as pronounced in other accounting providers, making Sage ideal for those who value this kind of reliable and extensive support. However, its user interface is generally not regarded to be as intuitive as Xero’s, so for a more user-friendly experience, Xero could be a preferable choice.

Sage’s base package, Accounting Start, costs £14 per month (exc VAT) and includes tools to calculate and submit VAT returns. When it comes to self-employed accounting software, this plan is probably more suited to well-established freelance/sole trader businesses.

Sage pricing

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Plan

Accounting Start

Plan

Accounting Standard

Plan

Accounting Plus

Cost

£14 per month (plus VAT)

Cost

£28 per month (plus VAT)

Cost

£36 per month (plus VAT)

Verdict

If you’re looking for basic accounting software and support to guide you every step of the way, then Sage Business Cloud Accounting could well be your best option for self-employed accounting software. The 24/7 support on offer is unrivalled, but for most freelancers and sole traders, the feature list is a bit limited for the price.

To learn more, check out our in-depth Sage Business Cloud Accounting review.

Xero – best for a clean, user-friendly interface

4.6 out of 5
  • Bookkeeping
    5
  • Price
    3.8
  • Financial Reporting
    5
Xero pros
  • Already compliant with Making Tax Digital for Income Tax
  • Extensive feature offering at a competitive price rate
  • Provides an easy-to-use budget creator on all pricing tiers
  • Enables users on all tiers to easily record fixed assets
Xero cons
  • Users on lowest tier can only input up to 5 bills per month, severely limiting the accounts payable function for these users
  • Project accounting functionality costs an additional monthly fee
  • CIS features cost an additional monthly fee

Recommended plan

Xero features

Xero calls itself “beautiful accounting” – and here at Startups, we’re big fans of its elegant interface. Everything is laid out clearly, and the white, blue, grey, and light green pastel colours it uses are calming. This is important, given that you’ll be checking your accounting software a lot as you run your self-employed business.

Xero Accounting

Xero’s accounting dashboard

Crucially, there’s substance to go with that style. The basic £15 per month (exc VAT) starter plan lets you:

  • Create invoices and quotes
  • Enter bills
  • Reconcile bank transactions
  • Submit VAT returns to HMRC
  • Automatically calculate Construction Industry Scheme (CIS) deductions
  • Capture bills and receipts using Hubdoc

Xero boasts a clean and user-friendly interface, a feature not as prominent in its accounting software counterparts, ensuring a smooth and accessible financial management experience.

While it provides scalability, Xero does lack some specific client-impressing tools present in FreshBooks, for example, whose client-focused features set it apart from Xero. Unlike Xero, FreshBooks excels in providing impressive client interaction tools, offering a sleek and customisable invoicing system that enhances a professional image and facilitates seamless communication with clients. While Xero prioritises scalability and a clean interface, FreshBooks prioritises the tools and functionalities that directly contribute to leaving a lasting and positive impression on clients.

Xero’s basic plan also comes with some strict usage limits – you can only send 20 invoices and quotes, and enter five bills per month. Go above this, and you’ll need to start paying £30 per month (exc VAT) for the Standard plan. It’s a steep increase, especially given that the Standard plan offers no other extra features.

It’s also unclear what Xero’s promise of “24/7 support” actually means. Its website is full of helpful guides and instructional videos, but things are much less clear-cut when it comes to getting help from an actual human. Xero has no support number you can call, and no live chat option either. Instead, you send a message and then wait for them to get back to you. It’s hard to tell how long this takes, and there’s at least one disgruntled customer on the Xero forums complaining about waiting several hours for a response to their query.

Xero pricing

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Plan

Starter

Plan

Standard

Plan

Premium

Plan

Ultimate

Cost

£15 per month (plus VAT)

Cost

£30 per month (plus VAT)

Cost

£42 per month (plus VAT)

Cost

£55 per month (plus VAT)

Verdict

Provided you can stay within the usage limits, Xero is the natural choice for anyone who wants sleek, stylish self-employed accounting software. With those limits offering a very clear incentive to upgrade, Xero does offer an impressive range of features in its basic plan – making this plan perfect for any small-scale sole traders that need to work out VAT or CIS deductions. The limited support on offer, however, means that those less confident with accounting software might want to look elsewhere.

How does accounting software work?

Accounting software is designed to be user-friendly, with intuitive interfaces and navigation. This makes it accessible to users with varying levels of accounting knowledge. 

It simplifies financial tasks, automates calculations, improves reporting accuracy, facilitates integration with other systems, enhances security, and enables businesses to efficiently manage their finances and make better-informed decisions.

Many software providers offer customer support and training resources to assist users in getting the most out of their accounting software.

You can also rest assured that while managing all these large financial processes, accounting software also offers features like user access controls, data encryption, and regular backups to safeguard sensitive financial data.

What types of businesses is accounting software suitable for?

Accounting software is suitable for a wide range of businesses, regardless of their size or industry. It can be utilised by small startups, freelancers, sole proprietors, mid-sized companies, and large enterprises. 

The software’s flexibility allows it to adapt to various business models and structures. It can handle different types of transactions, such as sales, purchases, expenses, payroll, and inventory management. This makes it applicable to businesses involved in retail, e-commerce, professional services, consulting, hospitality, construction, and many other sectors.

Accounting software provides benefits to businesses with different levels of financial expertise. The software’s user-friendly interfaces and customisable features make it accessible to users with varying levels of accounting knowledge, and tailored to meet the specific needs of many different industries.

Buying guide: How to choose your self-employed accounting software

Choosing the right self-employed accounting software for your business is just like choosing anything else – you need to work out what you need most, and what you can live without.

If, for example, you’re VAT registered, then it’s going to make a real difference if you choose software that lets you directly submit VAT returns to HMRC. And if you know you’ll need to calculate Construction Industry Scheme (CIS) deductions, then look for a plan that offers this.

More generally, think carefully about how your business works. If the plan you’re considering has strict usage limits, then work out whether you’re likely to be able to stay within them. You should also think about how much you’ll actually use advanced features like time tracking, or being able to submit your expenses just by snapping a receipt with your smartphone.

Just as importantly, think about how you work. If you’re an IT whizz that loves learning new software, then you probably don’t need to worry too much about when and how in-person support is available. If you’re less confident though, it could be worth paying a bit more to ensure there’s always someone to call if/when you run into problems.

Finally, if you really can’t decide, then check whether a free trial is available. At the time of writing, QuickBooks, Sage, Xero, and Freshbooks all offer 30-day free trials, so you can take them for a spin and see if they’re the right self-employed accounting software for you. If you do do this though, make sure you know what features would actually be on offer in your chosen plan – the free trial generally gives you access to everything, and there’s no point diving into features that are only available on plans you can’t afford.

This time and effort is worth it, though. Whether you’re self-employed, a freelancer, or a sole trader, finding the right accounting software can make running your business quicker, easier, and less stressful – leaving you more time to do what you’re actually good at.

What should I look for in self-employed accounting software?

  • User-friendly interface: opt for software with an intuitive interface. As a self-employed individual, you’ll want a user-friendly design that ensures you can efficiently handle your finances without getting bogged down in complicated navigation.
  • Invoicing capability: look for software that allows easy and customisable invoicing. This will not only save you time, but will also present a professional image to clients, helping you get paid promptly.
  • Expense tracking: this function is vital for maintaining a clear overview of your financial outflows, aiding in budgeting and tax deductions.
  • Mobile accessibility: as a self-employed professional, the ability to manage your accounts on the go will provide flexibility and convenience, ensuring you stay on top of your finances no matter where your work takes you.
  • Tax management tools: ensure the software includes tax management tools which will help you simplify the process of calculating and filing taxes and reduce the risk of errors.
  • Bank integration: selecting software that seamlessly integrates with your bank makes your life much easier in the long run. It will help you to automate the process of importing transactions much faster, on your end as well as your customers’.
  • Financial reporting: Prioritise software with comprehensive reporting capabilities. Clear and insightful financial reports empower you to make informed decisions and gain a deeper understanding of your business’s financial health.
  • Scalability: Consider the scalability of the software. As your self-employed venture grows, you’ll want software that can scale with your business, accommodating increased data and transaction volumes without compromising performance.

How we test accounting software for UK small businesses

At Startups, it's important to us that the product recommendations we make to small UK businesses are useful, accurate, and based on thorough product testing.

We tested ten market-leading accounting software platforms across four main categories of investigation and 24 subcategories – all in all, we covered 111 areas of investigation. Next, we gave a ‘relevance weighting' to the final product category scores - this ensures the products' final ratings perfectly reflect the specific needs and requirements of Startups readers.

Our main testing categories for accounting software are:

Help and Support: Help and support refer to the assistance and resources available to users when they encounter issues or need guidance while using the accounting software.

Pricing: Pricing refers to the cost associated with using the accounting software. It includes factors such as licensing fees and subscription plans.

Main functions: This represents the key areas of accounting that the software focuses on. This includes functionalities such as financial statement preparation, income and expense tracking, and managing vendor and customer accounts.

Software Functionality: Refers to the software capabilities such as integrations, mobile capability, and confirming any additional features outside of accounting.

The Startups product testing process

The Startups product testing process diagram

Verdict

As we stand on the cusp of the approaching financial year in April 2024, we can’t emphasise the significance of having your accounting software in place enough. Setting up or transitioning to a reliable platform before the new year not only ensures a seamless start but also sidesteps the complications of mid-year data transfers, so you’ll want to make sure you don’t miss out.

To help you make this strategic leap into efficiency, here’s a recap:

QuickBooks for streamlined tax returns:

Why choose: QuickBooks takes the lead with its exceptional features tailored for seamless tax return processes. Its intuitive design and comprehensive tools simplify the intricate task of tax management, making it an ideal choice for self-employed individuals aiming for a hassle-free tax season.

FreshBooks for client impressions:

Why choose: FreshBooks shines in leaving a lasting impression on clients with its polished and customisable invoicing tools. It elevates the professional image of self-employed individuals, fostering stronger client relationships through its sleek and impressive invoicing capabilities.

Sage Business Cloud Accounting for customer service excellence:

Why choose: Sage Business Cloud Accounting stands out for its dedication to exceptional customer service. Beyond its functional prowess, it excels in providing top-notch support, ensuring self-employed users receive prompt assistance and guidance whenever needed.

Xero for an intuitive interface

Why choose: Xero takes the crown for its exceptionally clean and user-friendly interface. Perfect for those seeking simplicity without compromising functionality, its intuitive design ensures a smooth and pleasant experience for self-employed individuals managing their finances.

Frequently Asked Questions
  • What's the difference between accounting and bookkeeping?
    Bookkeeping is about recording financial transactions, like a money diary, while accounting takes it further, analysing those records to understand your financial health, pay the right amount of taxes and make smarter decisions for your business.
  • How is self-employed accounting software different from other accounting software?
    Self-employed accounting software is designed with solo warriors in mind. It's usually more streamlined, focusing on essentials like invoicing, expense tracking, and tax management in a more concise way, instead of getting you overwhelmed with functions and reports you don't need to be handling yet.
  • Is there free accounting software?
    Yes, there free accounting software is currently available from providers including Zoho Books, Quickfile, and FreeAgent. It offers basic functionalities like expense tracking and invoicing, but can do very little beyond the core capabilities. While free software might not have all the bells and whistles, it's a great starting point for those dipping their toes into financial management without wanting to breaking the bank.
  • How do I set up accounting software?
    Setting up accounting software is often a step-by-step process. You'll typically start by creating an account, inputting your business details, linking your bank accounts, and customising the settings to suit your business needs. Many platforms offer helpful tutorials or customer support to guide you through the process.
  • What is Making Tax Digital?
    Making Tax Digital (MTD) is a UK government initiative aiming to digitise tax records and submissions. It requires businesses, including the self-employed, to keep digital records and submit tax information using compatible software, ensuring more accuracy and efficiency in tax affairs. Making Tax Digital for VAT has been in place since April 2022, whereas Making Tax Digital for Income Tax is coming up in April 2026.
  • Why should I choose accounting software in time for the new financial year?
    Getting your accounting software ready before the new financial year starts sets you up for success. It ensures a clean slate for your financial records, avoiding the headache of transferring data mid-year. Plus, it helps you stay organised, compliant with tax requirements, and in control of your financial game plan right from the start.

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Written by:
Stephanie Lennox is the resident funding & finance expert at Startups: A successful startup founder in her own right, 2x bestselling author and business strategist, she covers everything from business grants and loans to venture capital and angel investing. With over 14 years of hands-on experience in the startup industry, Stephanie is passionate about how business owners can not only survive but thrive in the face of turbulent financial times and economic crises. With a background in media, publishing, finance and sales psychology, and an education at Oxford University, Stephanie has been featured on all things 'entrepreneur' in such prominent media outlets as The Bookseller, The Guardian, TimeOut, The Southbank Centre and ITV News, as well as several other national publications.
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