Xero (company)

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Xero Limited
Public
Traded asASXXRO
IndustrySoftware as a Service (SaaS)
FoundedNew Zealand (2006)
FounderRod Drury Edit this on Wikidata
Headquarters,
Key people
ProductsAccounting software
Revenue
  • Increase NZ $718.2 million
  • (FY 31 March 2020)
Number of employees
  • Increase 3000+
  • (FY 31 March 2020)
WebsiteXero.com
Footnotes / references
[1][2][3][4][5]

[6] [7]

[8]

Xero is a New Zealand domiciled public technology company, listed on the Australian Stock Exchange.[9] 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),[10] three offices in the United States (Denver, San Francisco and New York), as well as offices in Canada, Singapore, Hong Kong and South Africa.[11]

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.[12] Its products are used in over 180 different countries.[13][14]

History[edit]

Xero was founded in Wellington during 2006 by Rod Drury and his personal accountant Hamish Edwards.[15][16][17] Xero Limited's headquarters are still located in Wellington.[18] The company was originally called Accounting 2.0.[17]

In 2017, Xero surpassed one million customers globally,[19] and the following year, in December 2018, Xero hit a million subscribers in its home markets of Australia and New Zealand.[20]

Rod Drury stepped down as CEO on 31 March 2018, and was replaced by Steve Vamos in April 2018. Drury remains on the board as a non-executive director.[21]

Funding[edit]

Xero went public on the New Zealand Exchange on 5 June 2007, with a $15 million (NZD) IPO, gaining 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.[10] The company focused on the New Zealand market and product and development for its first five years before entering other markets. It went public on the Australian Securities Exchange (ASX) on 8 November 2012.[3][23] Xero transitioned to a sole listing on the ASX on 5 February 2018, delisting from the NZX on 2 February 2018. 31 January 2018 was the last day Xero shares were traded on the NZX.[citation needed]

Xero has also received funding from various investors. In 2009, it 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 who also invested an additional $16.6 million (USD) in February 2012.[25] It raised $49 million in a funding round in November 2012 with the largest amounts coming from Peter Thiel and Matrix Capital. It was reported by PandoDaily that the company had raised more than $100 million and had a valuation of approximately $1.4 billion on the NZE as of May 2013.[10][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 on 25 February 2015.[28] On 5 October 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]

Xero has acquired several companies since its launch. In July 2011, the company acquired the Australian online payroll provider Paycycle for a mixture of cash and shares totaling $1.9 million (NZD) in order to integrate the company's products into its services.[30] 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 cloud-based accounts preparation and tax filing solution Instafile for £5.25 million (GBP), which will be paid over three years.[33]

Product[edit]

Xero accounting software uses a single unified ledger, which 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 over 800 third party apps, and more than 200 connections to financial service providers around the world.[35][36][37]

In 2011, Xero released the Xero Touch mobile apps for iOS and Android devices,[38] allowing users to issue invoices while on-site with clients.[39]

In the 2019 financial year, Xero offered services relating to Making Tax Digital in the United Kingdom,[40] Single Touch Payroll in Australia[41] and Payday Filing in New Zealand.[42]

See also[edit]

References[edit]

  1. ^ "Xero Limited Annual Report (Fiscal Year: March 31, 2018)" (PDF). Xero Limited. Retrieved 27 November 2018.
  2. ^ 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. ^ "ASX" (PDF).
  7. ^ "Xero Delivers 30% Revenue Growth &Free Cash Flow Progress" (PDF). Retrieved 17 March 2020.
  8. ^ "Xero Limited 2020 Annual Report" (PDF). Retrieved 17 March 2020.
  9. ^ "Australian Securities Exchange", Wikipedia, 16 June 2019, retrieved 26 June 2019
  10. ^ 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.
  11. ^ Campbell, Anita (13 October 2013). "Small Biz Accounting Software Space Heats Up As Xero Raises $150 Million". Small Biz Trends. Retrieved 15 January 2014.
  12. ^ Robins, Brian (6 November 2013). "Sharemarket darling Xero dubbed 'Apple of accounting'". The Sydney Morning Herald. Retrieved 15 January 2014.
  13. ^ "Xero grows to $1 Billion revenue – Enterprise Times". Enterprise Times. 20 July 2016. Retrieved 30 May 2018.
  14. ^ holly.ryan@nzherald.co.nz @HollyRoseRyan, Holly Ryan Business writer, NZ Herald (9 May 2018). "Xero halves losses, closes in on profitability". ISSN 1170-0777. Retrieved 12 July 2019.
  15. ^ "No guts, no glory for Xero boss". Stuff. Retrieved 1 March 2020.
  16. ^ Gregersen, Hal. "How Rod Drury Built Xero From A 'Small Set Of Rocks In The South Pacific' Into A Global Player". Forbes. Retrieved 22 January 2020.
  17. ^ a b "THE UNTOLD STORY: How Xero took a band name and changed accounting for a million companies". Business Insider. Retrieved 27 June 2019.
  18. ^ Brooks, Steve (20 July 2016). "Xero grows to $1 Billion revenue -". Enterprise Times. Retrieved 27 June 2019.
  19. ^ aimee.shaw@nzherald.co.nz @AceeyShaw, Aimee Shaw Aimee Shaw is a business reporter focusing on retail, small business (29 March 2017). "Accounting software firm Xero surpasses one million users worldwide". ISSN 1170-0777. Retrieved 12 July 2019.
  20. ^ "Xero hits million mark for trans-Tasman subscribers". New Zealand Reseller News. Retrieved 12 July 2019.
  21. ^ holly.ryan@nzherald.co.nz @HollyRoseRyan, Holly Ryan Business writer, NZ Herald (4 March 2018). "Xero CEO Rod Drury stepping down". ISSN 1170-0777. Retrieved 12 July 2019.
  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 22 January 2020.
  24. ^ Sharp, Ari (7 April 2009). "MYOB founder buys into rival". The Sydney Morning Herald. Retrieved 22 January 2020.
  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 22 January 2020.
  29. ^ Editors, FinanceAsia. "Achievement Awards 2018 – Australia/NZ Part 1 | australia awards, achievement awards, awards, australia, new zealand". FinanceAsia. Retrieved 4 July 2019.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 (19 July 2018). "Xero forms alliance with US payrolls platform Gusto". ISSN 1170-0777. Retrieved 12 July 2019.
  32. ^ "Xero acquires Hubdoc". Finextra Research. 1 August 2018. Retrieved 12 July 2019.
  33. ^ Brooks, Steve (16 November 2018). "Xero acquires Instafile for £5.25 million -". Enterprise Times. Retrieved 22 January 2020.
  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. ^ "Xero Limited 2020 Annual Report" (PDF). Retrieved 10 June 2020.
  38. ^ Fineberg, Seth. "Xero Debuts Mobile App for Android". Accounting Today. Retrieved 9 September 2013.
  39. ^ Smith, Heather (23 May 2013). Xero For Dummies. John Wiley & Sons. p. 35. ISBN 978-1-118-57252-8.
  40. ^ "Xero is preparing for Making Tax Digital". Accountancy Age. 15 November 2018. Retrieved 12 July 2019.
  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 12 July 2019.