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|Traded as||ASX: XRO|
|Industry||Software as a Service (SaaS)|
|Founded||New Zealand (2006)|
Number of employees
|Footnotes / references|
Xero is a New Zealand domiciled public technology company, listed on the Australian Stock Exchange. 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), three offices in the United States (Denver, San Francisco and New York), as well as offices in Canada, Singapore, Hong Kong and South Africa.
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. Its products are used in over 180 different countries.
Xero was founded in Wellington during 2006 by Rod Drury and his personal accountant Hamish Edwards. Xero Limited's headquarters are still located in Wellington. The company was originally called Accounting 2.0.
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.
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. 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. 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. 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.
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. 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. 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. 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. Xero raised an additional $100 million from Accel and $10.8 million from Matrix Capital on 25 February 2015. 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.
Acquisitions and strategic partnerships
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. In July 2018, Xero announced a strategic alliance with US payroll platform Gusto.
In August 2018, Xero acquired Hubdoc, a data capture solution.
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.
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.
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