Freshbooks is an online invoicing and time-tracking service that is making book-keeping and invoice preparation a lot easier for small businesses.

Freshbooks Founder Michael McDerment and Saul Colt , Head of Magic (yep, that’s what his business card says) recently gave the Third Tuesday Toronto participants an insiders’ view of how they have built this Web 2.0 startup.

In the next series of posts, I’m going to publish video excerpts from their presentation, each of which has been edited to capture a single topic or theme. I think you’ll find Michael and Saul’s clips chock full of good ideas and tips for setting up a successful small business and harnessing social media to promote it and connect with users.