Xero (software)

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Xero Limited
Traded asASXXRO
IndustrySoftware as a Service (SaaS)
FoundedNew Zealand (2006)
FounderRod Drury Edit this on Wikidata
Key people
  • Graham Smith
  • (Chairman of the Board)
  • Rod Drury
  • (Founder & Director)
  • Steve Vamos
  • (CEO)
ProductsAccounting software
  • Increase NZ$ 552.8 million
  • (FY MAR. 31, 2018)
  • Increase NZ$ -28.67 million
  • (FY MAR. 31, 2018)
  • Increase NZ$ -27.84 million
  • (FY MAR. 31, 2018)
Total assets
  • Decrease NZ$ 117.98 million
  • (FY MAR. 31, 2018)
Total equity
  • Decrease NZ$ 223.13 million
  • (FY MAR. 31, 2018)
Number of employees
  • Increase 2500+
  • (FY MAR. 31, 2019)
Footnotes / references

Xero is a New Zealand domiciled public technology company, listed on the Australian Stock Exchange.[6] Xero offers a cloud-based accounting software platform for small and medium-sized businesses. The company has three offices in New Zealand (Wellington, Auckland and Napier), six offices in Australia (Melbourne, Sydney, Canberra, Adelaide, Brisbane and Perth), three offices in the United Kingdom (London, Manchester and Milton Keynes),[7] three offices in the United States (Denver, San Francisco and New York), as well as offices in Canada, Singapore, Hong Kong and South Africa.[8]

Xero's products are based on the software as a service (SaaS) model and sold by subscription, based on the type and number of company entities managed by the subscriber.[9] Its products are used in over 180 different countries.[10][11]


In 2006, Xero was founded in a Wellington studio apartment by Rod Drury and Hamish Edwards,[12] who felt that traditional desktop accounting software had become outdated. They decided to create a modern cloud-based product.[2][13][14] Xero Limited's global headquarters are still located in Wellington.[15]

Originally called Accounting 2.0, the name was unpopular with the company’s staff and the decimal point made it impossible to register for an internet domain. The company changed the name to Xero, which also proved to be a challenge, as the existing xero.com domain was a Linkin Park fan site (Xero was Linkin Park’s original name). Drury flew the existing domain owner to New Zealand from the United States and ultimately convinced him to sell the domain for $20,000.[14]

The company entered the Australian market and the United Kingdom in 2008,[16][better source needed] and United States in 2011.[17][better source needed]

In 2017, Xero surpassed one million customers globally,[18] and the following year, in December 2018, Xero hit a million subscribers in its home markets of Australia and New Zealand.[19]

Rod Drury stepped down as CEO on 31 March 2018, with Steve Vamos replacing the role in April 2018. Drury remains on the board as a non-executive director.[20]

In 2019, Xero announced it had hit 1.8 million subscribers, employed 2,500+ people around the world and achieved positive free cash flow for the first time.[21]


Xero went public on the New Zealand Exchange on June 5, 2007, with a $15 million (NZD) IPO, and gained 15% on its first trading day.[22] Drury decided to list on the NZX, rather than receive investment from Silicon Valley in order to avoid being pressured into selling to a larger competing company.[7] It went public on the Australian Securities Exchange (ASX) in November 2012.[3][23] Xero transitioned to a sole listing on the ASX on February 5, 2018, and delisted from the NZX on February 2, 2018. January 31, 2018 was the last day Xero shares were traded on the NZX.[citation needed]

In 2009, Xero closed a $23 million (NZD) round of funding led by MYOB founder, Craig Winkler.[24] It raised an additional $4 million (NZD) in 2010 from Peter Thiel's Valar Ventures.[25] In November 2012, it raised $49 million in a funding round, with the largest amounts coming from Peter Thiel and Matrix Capital. In May 2013, the company had raised more than $100 million and had a valuation of approximately $1.4 billion on the NZE.[7][26] This was prior to when the company received an additional $180 million (NZD) from Thiel and Matrix in October 2013, bringing total funding to more than $230 million.[27] Xero raised an additional $100 million from Accel and $10.8 million from Matrix Capital in February 25, 2015.[28] On October 5, 2018, Xero announced a settlement of $300 million (USD) in convertible notes. The capital raise was groundbreaking for a New Zealand or Australian company not listed in the United States, and the company was awarded best hybrid deal of 2018 by Finance Asia.[29]

Acquisitions and strategic partnerships[edit]

In July 2011, Xero acquired the Australian online payroll provider Paycycle for a mixture of cash and shares totaling $1.9 million (NZD). The acquisition allowed Xero to integrate payroll into their Australian product offering.[30] In July 2012, it acquired Spotlight Workpapers for a mixture of cash and shares totaling $800,000.[citation needed]

The same year it acquired WorkflowMax for cash and shares totaling $6 million (NZD).[citation needed]

In July 2018, Xero announced a strategic alliance with US payroll platform Gusto.[31]

In August 2018, Xero acquired Hubdoc, a data capture solution.[32]

In November 2018, Xero acquired Instafile, a cloud-based accounts preparation and tax filing service for £5.25 million (GBP).[33]


Xero’s single unified ledger, allows users to work in the same set of books regardless of location or operating system.[34]

Its key features include automatic bank feeds, invoicing, accounts payable, expense claims, fixed asset depreciation, purchase orders, bank reconciliations, and standard business and management reporting. Xero has more than 200 secure connections with banks and financial service partners around the world. A free API also enables customers and 3rd-party software vendors to integrate external applications with Xero. Xero has integrations with 700+ third party apps, and there are over 50,000 users of Xero’s API developer tools.[35][36]

In 2011, Xero released the Xero Touch mobile apps for iOS and Android devices,[37] allowing users to issue invoices while on-site with clients.[38]

Xero also supports multiple tax rates and currencies.[39] It also incorporates payroll, projects and expenses features.

In the 2019 financial year, Xero embraced Making Tax Digital in the United Kingdom,[40] Single Touch Payroll in Australia[41] and Payday Filing in New Zealand,[42]  allowing subscribers to manage their compliance obligations through the Xero platform.

Awards and recognition[edit]

In 2007 Xero received the Overall Partner Solution of the Year for Small Business and also featured as part of a Microsoft case study.[43] The company was the recipient of two Webby Awards in 2009, including the People's Choice Award for Banking/Bill Pay.[44] It was recognized again with a Webby in 2010 for Web Services & Applications. It received a Fast Company Innovation by Design Award in 2012.[45] and was recognized as one of the 10 Smart Financial Apps to Solve Small Business Accounting Challenges by YFS Magazine in 2013.[46][47] Additional awards in 2013 included the Awesome Application Award from the Sleeter Group and the New Zealand Company of the Year from Hi-Tech.[48] In June 2014, Xero topped the Forbes magazine "100 most innovative growth companies" list.[49] Also in 2014, the company was named one of Macworld's recommended online business accounting apps.[50] In January 2015, Xero was crowned best accounting software in the Cloudswave Awards with a score of 83,[51]and New Zealand Company of the Year from Hi-Tech for the second time. [52]Xero won Product of the Year at the British Accountancy Awards 2017[53] and also won Best Overall Fintech platform by the Fintech Breakthrough Awards in 2017.[54] The company was rated by CANSTAR Blue as Australia’s best accounting software four consecutive years from 2015-2018.[55] On the inaugural 2018 Financial Times FT1000 High-Growth Companies Asia Pacific list, Xero was the fastest growing tech company in the $200 million+ segment. In 2018 Xero also won ‘Bookkeeping software of the Year’ from the Institute of Certified Bookkeepers UK and Small Business Accounting Software of the Year' – Practitioners’ Cchoice’ from members of AccountingWeb (UK).

See also[edit]


  1. ^ "Xero Limited Annual Report (Fiscal Year: March 31, 2018)" (PDF). Xero Limited. Retrieved November 27, 2018.
  2. ^ a b Laugesen, Ruth (17 October 2013). "From Xero a hero". New Zealand Listener (subscription required). Retrieved 15 January 2014.
  3. ^ a b Barwick, Harrish (8 November 2012). "NZ-based SaaS provider Xero lists on ASX". Computer World. Retrieved 15 January 2014.
  4. ^ "Xero Limited 2018 Annual Report" (PDF). Retrieved 24 May 2016.
  5. ^ "Xero Limited 2018 Interim Report" (PDF). Retrieved 17 March 2018.
  6. ^ "Australian Securities Exchange", Wikipedia, 2019-06-16, retrieved 2019-06-26
  7. ^ a b c McKenzie, Hamish (1 May 2013). "Xero: A billion-dollar software company that had five years in stealth at the bottom of the planet". Pando Daily. Retrieved 15 January 2014.
  8. ^ Campbell, Anita (13 October 2013). "Small Biz Accounting Software Space Heats Up As Xero Raises $150 Million". Small Biz Trends. Retrieved 15 January 2014.
  9. ^ Robins, Brian (6 November 2013). "Sharemarket darling Xero dubbed 'Apple of accounting'". The Sydney Morning Herald. Retrieved 15 January 2014.
  10. ^ "Xero grows to $1 Billion revenue - Enterprise Times". Enterprise Times. 2016-07-20. Retrieved 2018-05-30.
  11. ^ holly.ryan@nzherald.co.nz @HollyRoseRyan, Holly Ryan Business writer, NZ Herald (2018-05-09). "Xero halves losses, closes in on profitability". ISSN 1170-0777. Retrieved 2019-07-12.
  12. ^ Rose, Sally (21 September 2014). "No guts, no glory for Xero boss". Stuff.
  13. ^ Gregersen, Hal. "How Rod Drury Built Xero From A 'Small Set Of Rocks In The South Pacific' Into A Global Player". Forbes. Retrieved 2020-01-22.
  14. ^ a b "THE UNTOLD STORY: How Xero took a band name and changed accounting for a million companies". Business Insider. Retrieved 2019-06-27.
  15. ^ Brooks, Steve (2016-07-20). "Xero grows to $1 Billion revenue -". Enterprise Times. Retrieved 2019-06-27.
  16. ^ "Xero Chairman's Address for 2009 Annual Meeting" (PDF). XERO. 23 July 2009. Retrieved 24 May 2016.
  17. ^ "Chairman's Address for 2011 Annual Meeting" (PDF). XERO. 21 July 2011. Retrieved 24 May 2016.
  18. ^ aimee.shaw@nzherald.co.nz @AceeyShaw, Aimee Shaw Aimee Shaw is a business reporter focusing on retail, small business (2017-03-29). "Accounting software firm Xero surpasses one million users worldwide". ISSN 1170-0777. Retrieved 2019-07-12.
  19. ^ "Xero hits million mark for trans-Tasman subscribers". New Zealand Reseller News. Retrieved 2019-07-12.
  20. ^ holly.ryan@nzherald.co.nz @HollyRoseRyan, Holly Ryan Business writer, NZ Herald (2018-03-04). "Xero CEO Rod Drury stepping down". ISSN 1170-0777. Retrieved 2019-07-12.
  21. ^ Waters, Cara (2019-05-16). "From Xero to $1 billion: Aussie tech company's founder joins global big time". The Sydney Morning Herald. Retrieved 2019-07-12.
  22. ^ Niesche, Christopher (6 June 2007). "Xero begins strongly". New Zealand Herald. Retrieved 15 January 2014.
  23. ^ Geron, Tomio. "Peter Thiel's Valar Ventures Joins $67 Million Round For Xero". Forbes. Retrieved 2020-01-22.
  24. ^ Sharp, Ari (2009-04-07). "MYOB founder buys into rival". The Sydney Morning Herald. Retrieved 2020-01-22.
  25. ^ Wauters, Robin (22 October 2010). "Peter Thiel Invests $3 Million In Xero To Support Its US Expansion". Tech Crunch. Retrieved 15 January 2014.
  26. ^ Williams, Alex (29 November 2012). "Peter Thiel And Existing Investors Put Another $49 Million In Accounting Software Company Xero". Tech Crunch. Retrieved 15 January 2014.
  27. ^ Lunden, Ingrid (13 October 2013). "Xero Zeros In On Another $150M To Do Battle With Intuit In The World Of Online SMB Accounting Software". Tech Crunch. Retrieved 15 January 2014.
  28. ^ "Xero secures US$141M from Accel Partners, Matrix Capital Management". e27. Retrieved 2020-01-22.
  29. ^ Editors, FinanceAsia. "Achievement Awards 2018 – Australia/NZ Part 1 | australia awards, achievement awards, awards, australia, new zealand". FinanceAsia. Retrieved 2019-07-04.CS1 maint: extra text: authors list (link)
  30. ^ Rogers, Claire. "Xero buys payroll firm to boost Aust growth". Stuff.co.nz. Retrieved 19 September 2013.
  31. ^ jamie.gray@nzherald.co.nz @JamieGrayNZ, Jamie Gray Business reporter, NZ Herald (2018-07-19). "Xero forms alliance with US payrolls platform Gusto". ISSN 1170-0777. Retrieved 2019-07-12.
  32. ^ "Xero acquires Hubdoc". Finextra Research. 2018-08-01. Retrieved 2019-07-12.
  33. ^ Brooks, Steve (2018-11-16). "Xero acquires Instafile for £5.25 million -". Enterprise Times. Retrieved 2020-01-22.
  34. ^ Lam, Greg (2 July 2013). "Cloud Accounting Comparison – Data Import and Export". Sleeter. Retrieved 16 January 2014.
  35. ^ Lam, Greg. "Xero Review". The Small Biz Doer. Retrieved 19 September 2013.
  36. ^ LaBarre, Suzanne (25 February 2012). "Xero Reinvents Accounting For Small Businesses, With Superb UI Design". Fast Code Design. Retrieved 15 January 2014.
  37. ^ Fineberg, Seth. "Xero Debuts Mobile App for Android". Accounting Today. Retrieved 9 September 2013.
  38. ^ Smith, Heather (23 May 2013). Xero For Dummies. John Wiley & Sons. p. 35. ISBN 978-1-118-57252-8.
  39. ^ "Multi-currency accounting in Xero". Xero. Retrieved 2019-07-12.
  40. ^ "Xero is preparing for Making Tax Digital". Accountancy Age. 2018-11-15. Retrieved 2019-07-12.
  41. ^ Zaharov-Reutt, Alex (28 November 2018). "Xero says 'small businesses rushing to go digital as STP deadline approaches'". iwire.
  42. ^ "Tax refund agents weigh futures as IRD prepares huge software release". New Zealand Reseller News. Retrieved 2019-07-12.
  43. ^ "Software Developer Improves Service Levels With Superior Database Technology, Flexible Licenses". Microsoft Corporation. 10 September 2007. Retrieved 16 January 2014."
  44. ^ Friday; October 2010, 22; BusinessDesk, 11:02 am Article:. "PayPal founder pumps $4mln into Xero | Scoop News". www.scoop.co.nz. Retrieved 2019-07-12.CS1 maint: extra punctuation (link)
  45. ^ "Xero -- The Webby Awards". Retrieved 2019-07-12.
  46. ^ "10 Smart Financial Apps to Solve Small Business Accounting Challenges". YFS Magazine. 2013-01-04. Retrieved 2019-07-12.
  47. ^ "Is xero online accounting suitable for small business | Digital Grog | Technology Blog Australia". www.digitalgrog.com.au. Retrieved 2019-07-12.
  48. ^ "Xero and Vend big winners at NZ Hi-Tech Awards 2013". The National Business Review. 2013-05-18. Retrieved 2019-07-12.
  49. ^ "Most Innovative Growth Companies". Forbes. Retrieved 2019-07-12.
  50. ^ "Top Choice: Our favorite online-based business accounting apps". Macworld. 2014-03-10. Retrieved 2019-07-12.
  51. ^ Skellern, Graham (2017-11-23). "Deloitte Top 200: Visionary Leader - Rod Drury, Xero". ISSN 1170-0777. Retrieved 2019-07-12.
  52. ^ "Hi-Tech Awards 2015 winners named". The National Business Review. 2015-05-16. Retrieved 2019-07-12.
  53. ^ "2017 Winners". British Accountancy Awards. Retrieved 2019-07-12.
  54. ^ "2017 Winners | FinTech Breakthrough Awards". Retrieved 2019-07-12.
  55. ^ "Accounting Software | 2018 Reviews & Ratings". Canstar Blue. Retrieved 2019-07-12.