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'''Xero''' is a New Zealand domiciled, Australian Stock Exchange listed public software company that offers a [[cloud-based]] [[accounting software]] platform for small and medium-sized businesses. The company has offices in New Zealand, [[Australia]], the United Kingdom,<ref name="PandoDailyBillion">{{cite news |last=McKenzie |first=Hamish |date=1 May 2013 |title=Xero: A billion-dollar software company that had five years in stealth at the bottom of the planet |newspaper=Pando Daily |url=http://pando.com/2013/05/01/xero-a-billion-dollar-software-company-that-had-five-years-in-stealth-at-the-bottom-of-the-planet/ |accessdate=15 January 2014}}</ref> the United States, Canada, Asia and South Africa.<ref>{{cite news |last=Campbell |first=Anita |title=Small Biz Accounting Software Space Heats Up As Xero Raises $150 Million |publisher=Small Biz Trends |date=13 October 2013 |url=http://smallbiztrends.com/2013/10/xero-small-business-accounting-software-funding.html|accessdate=15 January 2014}}</ref> It is listed on the [[Australian Securities Exchange]].<ref name="ZNSAAS"/>
'''Xero''' is a New Zealand domiciled public technology company, listed on the Australian Stock Exchange<ref>{{Citation|title=Australian Securities Exchange|date=2019-06-16|url=https://en.wikipedia.org/enwiki/w/index.php?title=Australian_Securities_Exchange&oldid=902153038|work=Wikipedia|language=en|access-date=2019-06-26}}</ref>, listed public software company that 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, Brisban and Perth), two offices in the the United Kingdom (London and Milton Keynes),<ref name="PandoDailyBillion">{{cite news |last=McKenzie |first=Hamish |date=1 May 2013 |title=Xero: A billion-dollar software company that had five years in stealth at the bottom of the planet |newspaper=Pando Daily |url=http://pando.com/2013/05/01/xero-a-billion-dollar-software-company-that-had-five-years-in-stealth-at-the-bottom-of-the-planet/ |accessdate=15 January 2014}}</ref> three offices in the United States (Denver, San Francisco and New York), as well as offices in Canada, Singapore, Hong Kong and South Africa.<ref>{{cite news |last=Campbell |first=Anita |title=Small Biz Accounting Software Space Heats Up As Xero Raises $150 Million |publisher=Small Biz Trends |date=13 October 2013 |url=http://smallbiztrends.com/2013/10/xero-small-business-accounting-software-funding.html|accessdate=15 January 2014}}</ref>


Its 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.<ref>{{cite news |last=Robins |first=Brian |title=Sharemarket darling Xero dubbed ‘Apple of accounting’| location =|publisher=The Sydney Morning Herald |date=6 November 2013 |url=http://www.smh.com.au/business/sharemarket-darling-xero-dubbed-apple-of-accounting-20131106-2x0m7.html|accessdate=15 January 2014}}</ref>
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.<ref>{{cite news |last=Robins |first=Brian |title=Sharemarket darling Xero dubbed ‘Apple of accounting’| location =|publisher=The Sydney Morning Herald |date=6 November 2013 |url=http://www.smh.com.au/business/sharemarket-darling-xero-dubbed-apple-of-accounting-20131106-2x0m7.html|accessdate=15 January 2014}}</ref>Its products are used in over 180 different countries.<ref>{{Cite news|url=https://www.enterprisetimes.co.uk/2016/07/20/xero-grows-to-1-billion-revenue/|title=Xero grows to $1 Billion revenue - Enterprise Times|date=2016-07-20|work=Enterprise Times|access-date=2018-05-30|language=en-GB}}</ref><ref name="2018Report" />

As of March, 2018, its products are used in over 180 different countries.<ref>{{Cite news|url=https://www.enterprisetimes.co.uk/2016/07/20/xero-grows-to-1-billion-revenue/|title=Xero grows to $1 Billion revenue - Enterprise Times|date=2016-07-20|work=Enterprise Times|access-date=2018-05-30|language=en-GB}}</ref><ref name=2018Report/>


== History ==
== History ==
Xero was founded by [[Rod Drury]] and his [[Accountant|personal accountant]] when they felt that traditional [[Desktop software|desktop accounting software]] had become outdated and decided to create a modern cloud-based product.<ref name="NZListenerHero"/> Xero Limited was officially formed in 2006 in [[Wellington]], New Zealand where its global headquarters are still located.<ref>{{cite news |last=Calvey |first=Mark |title=New Zealand accounting software company expanding to Denver| location =|publisher=Denver Biz Journal |date=10 October 2013 |url=http://www.bizjournals.com/denver/news/2013/10/10/san-francisco-accounting-software.html |accessdate=15 January 2014}}</ref> The company entered the [[Australia|Australian market]] and the United Kingdom in 2008,<ref>{{cite news |date=23 July 2009 |title=Xero Chairman's Address for 2009 Annual Meeting |publisher=XERO |url=https://www.xero.com/media/37066/230709-xero-chairman-phil-normans-presentation-agm-2009.pdf |format=PDF |accessdate=24 May 2016}}</ref> and [[United States]] in 2011.<ref>{{cite news |date=21 July 2011 |title=Chairman's Address for 2011 Annual Meeting |publisher=XERO |url=https://www.xero.com/media/37039/210711-chairmans-address-xero-am.pdf |format=PDF |accessdate=24 May 2016}}</ref> In March 2016, Xero opened its first Asia office in Singapore and two years later in March 2018, the second Asia office in Hong Kong. In May 2018, Xero launched its cloud accounting software platform in Canada.<ref>{{Cite news|url=https://www.accountingtoday.com/news/xero-launches-in-canada|title=Xero launches in Canada|work=Accounting Today|access-date=2018-05-30|language=en}}</ref>
Xero was founded in a Wellington studio apartment by [[Rod Drury]] and his [[Accountant|personal accountant]] when they felt that traditional [[Desktop software|desktop accounting software]] had become outdated and decided to create a modern cloud-based product.<ref name="NZListenerHero"/> Xero Limited's global headquarters are still located in Wellington.<ref>{{Cite web|url=https://www.enterprisetimes.co.uk/2016/07/20/xero-grows-to-1-billion-revenue/|title=Xero grows to $1 Billion revenue -|last=Brooks|first=Steve|date=2016-07-20|website=Enterprise Times|language=en-GB|access-date=2019-06-27}}</ref>


Originally called Accounting 2.0, the name was unpopular with the company’s staff and the decimal point made registering an internet domain name impossible. Changing the name to Xero also provided a challenge with the domain name, as the existing xero.com domain was a [[Linkin Park]] fan site (Xero was Linkin Park’s original name). Rod decided to fly the existing domain administrator to New Zealand from the United States, wined and dined him, and ultimately convinced him to sell the domain for $20,000.<ref>{{Cite web|url=https://www.businessinsider.com/the-untold-story-how-xero-took-a-band-name-and-changed-accounting-for-a-million-companies-2017-9|title=THE UNTOLD STORY: How Xero took a band name and changed accounting for a million companies|website=Business Insider|access-date=2019-06-27}}</ref>
Rod Drury announced he would be stepping down as CEO in March 2018, with Steve Vamos entering the role in April 2018.<ref>{{Cite news|url=https://www.zdnet.com/article/xero-founder-rod-drury-steps-down-as-ceo/|title=Xero founder Rod Drury steps down as CEO {{!}} ZDNet|last=McLean|first=Asha|work=ZDNet|access-date=2018-07-24|language=en}}</ref>


The company entered the [[Australia|Australian market]] and the United Kingdom in 2008,<ref>{{cite news |date=23 July 2009 |title=Xero Chairman's Address for 2009 Annual Meeting |publisher=XERO |url=https://www.xero.com/media/37066/230709-xero-chairman-phil-normans-presentation-agm-2009.pdf |format=PDF |accessdate=24 May 2016}}</ref> and [[United States]] in 2011.<ref>{{cite news |date=21 July 2011 |title=Chairman's Address for 2011 Annual Meeting |publisher=XERO |url=https://www.xero.com/media/37039/210711-chairmans-address-xero-am.pdf |format=PDF |accessdate=24 May 2016}}</ref> In 2017, Xero surpassed one million customers globally and the following year, in December 2018 Xero hit a million subscribers in its home markets of Australia and New Zealand.
In June 2018, Xero updated its tagline from ‘beautiful accounting software’ to ‘beautiful business’.<ref>{{Cite web|url=http://www.scoop.co.nz/stories/BU1806/S00090/xero-announces-new-tagline-beautiful-business.htm|title=Xero announces new tagline: ‘Beautiful business’ {{!}} Scoop News|website=www.scoop.co.nz|access-date=2018-07-24}}</ref>


Rod Drury announced he would be stepping down as CEO in March 2018, with Steve Vamos starting the role in April 2018. Rod remains on the board as a non-executive director.
⚫
===Funding===

Xero launched its cloud accounting software platform in Asia in 2017, South Africa in 2017 and Canada in 2018.

In June 2018, Xero updated its tagline from ‘beautiful accounting software’ to ‘beautiful business’. More recently in 2019, Xero announced it had hit 1.8 million subscribers, employed 2,500+ people around the world and achieved positive fee cash flow for the first time.

⚫
==Funding==
Xero went public on the [[New Zealand Exchange]] on June 5, 2007 with a $15 million ([[New Zealand dollar|NZD]]) [[Initial public offering|IPO]], gaining 15% on its first trading day.<ref name="NZStock">{{cite news |last=Niesche |first=Christopher |title=Xero begins strongly | newspaper =New Zealand Herald |publisher= |date=6 June 2007 |url=http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10443821 |accessdate=15 January 2014}}</ref> 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.<ref name="PandoDailyBillion"/> The company focused on the New Zealand market and product and development for its first five years before entering other markets.<ref name="PandoDailyBillion"/> It went public on the [[Australian Securities Exchange]] on November 8, 2012.<ref name="ZNSAAS"/> Xero transitioned to a sole listing on the ASX on February 5, 2018, delisting from the NZX on February 2, 2018. January 31, 2018 was the last day Xero shares were traded on the NZX.
Xero went public on the [[New Zealand Exchange]] on June 5, 2007 with a $15 million ([[New Zealand dollar|NZD]]) [[Initial public offering|IPO]], gaining 15% on its first trading day.<ref name="NZStock">{{cite news |last=Niesche |first=Christopher |title=Xero begins strongly | newspaper =New Zealand Herald |publisher= |date=6 June 2007 |url=http://www.nzherald.co.nz/business/news/article.cfm?c_id=3&objectid=10443821 |accessdate=15 January 2014}}</ref> 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.<ref name="PandoDailyBillion"/> The company focused on the New Zealand market and product and development for its first five years before entering other markets.<ref name="PandoDailyBillion"/> It went public on the [[Australian Securities Exchange]] on November 8, 2012.<ref name="ZNSAAS"/> Xero transitioned to a sole listing on the ASX on February 5, 2018, delisting from the NZX on February 2, 2018. January 31, 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 (company)|MYOB]] founder Craig Winkler.<ref>{{cite news |last=Smith |first=Robert |title=MYOB founder helps Xero raise $23m for global push | newspaper =National Business Review |publisher= |date=7 April 2009 |url=http://www.nbr.co.nz/article/myob-founder-helps-xero-raise-23m-global-push-100124 |accessdate=15 January 2014}}</ref> It raised an additional $4 million (NZD) in 2010 from [[Peter Thiel]]'s [[Valar Ventures]],<ref>{{cite news |last=Wauters |first=Robin |title=Peter Thiel Invests $3 Million In Xero To Support Its US Expansion | newspaper =Tech Crunch |publisher= |date=22 October 2010 |url=https://techcrunch.com/2010/10/22/peter-thiel-xero/ |accessdate=15 January 2014}}</ref> who also invested an additional $16.6 million (USD) in February 2012.<ref>{{cite news |last=Wauters |first=Robin |title=Small business accounting service Xero raises $16.6M | newspaper =Venture Beat|publisher= |date=3 February 2012 |url=https://venturebeat.com/2012/02/03/xero-funding-16-m/|accessdate=15 January 2014}}</ref> It raised $49 million in a funding round in November 2012 with the largest amounts coming from Peter Thiel and [[Matrix Partners|Matrix Capital]]. It was reported by [[PandoDaily]] that the company has raised more than $100 million and had a valuation of approximately $1.4 billion on the NZE as of May 2013.<ref name="PandoDailyBillion"/><ref>{{cite news |last=Williams |first=Alex |title=Peter Thiel And Existing Investors Put Another $49 Million In Accounting Software Company Xero | newspaper =Tech Crunch|publisher= |date=29 November 2012 |url=https://techcrunch.com/2012/11/29/peter-thiel-and-existing-investors-put-another-49-million-in-accounting-software-company-xero/|accessdate=15 January 2014}}</ref> This was prior to the company receiving an additional $180 million (NZD) from Thiel and Matrix in October 2013, bringing total funding to more than $230 million.<ref>{{cite news |last=Lunden |first=Ingrid |title=Xero Zeros In On Another $150M To Do Battle With Intuit In The World Of Online SMB Accounting Software | newspaper =Tech Crunch|publisher= |date=13 October 2013 |url=https://techcrunch.com/2013/10/13/xero-zeros-in-on-another-150m-to-do-battle-with-intuit-in-the-world-of-online-smb-accounting-software/|accessdate=15 January 2014}}</ref> Xero raised an additional $100 million from [[Accel Partners|Accel]] and $10.8 million from [[Matrix Partners|Matrix Capital]] in February 25, 2015.<ref>{{cite web |title=Xero Attracts World-Class Investment and Talent to Fuel Growth |website=Xero |url=https://www.xero.com/media/5036812/xero_attracts_world-class_investment_and_talent_to_fuel_growth.pdf |accessdate=25 February 2015}}</ref>
Xero has also received funding from various investors. In 2009, it closed a $23 million (NZD) round of funding led by [[MYOB (company)|MYOB]] founder Craig Winkler.<ref>{{cite news |last=Smith |first=Robert |title=MYOB founder helps Xero raise $23m for global push | newspaper =National Business Review |publisher= |date=7 April 2009 |url=http://www.nbr.co.nz/article/myob-founder-helps-xero-raise-23m-global-push-100124 |accessdate=15 January 2014}}</ref> It raised an additional $4 million (NZD) in 2010 from [[Peter Thiel]]'s [[Valar Ventures]],<ref>{{cite news |last=Wauters |first=Robin |title=Peter Thiel Invests $3 Million In Xero To Support Its US Expansion | newspaper =Tech Crunch |publisher= |date=22 October 2010 |url=https://techcrunch.com/2010/10/22/peter-thiel-xero/ |accessdate=15 January 2014}}</ref> who also invested an additional $16.6 million (USD) in February 2012.<ref>{{cite news |last=Wauters |first=Robin |title=Small business accounting service Xero raises $16.6M | newspaper =Venture Beat|publisher= |date=3 February 2012 |url=https://venturebeat.com/2012/02/03/xero-funding-16-m/|accessdate=15 January 2014}}</ref> It raised $49 million in a funding round in November 2012 with the largest amounts coming from Peter Thiel and [[Matrix Partners|Matrix Capital]]. It was reported by [[PandoDaily]] that the company has raised more than $100 million and had a valuation of approximately $1.4 billion on the NZE as of May 2013.<ref name="PandoDailyBillion"/><ref>{{cite news |last=Williams |first=Alex |title=Peter Thiel And Existing Investors Put Another $49 Million In Accounting Software Company Xero | newspaper =Tech Crunch|publisher= |date=29 November 2012 |url=https://techcrunch.com/2012/11/29/peter-thiel-and-existing-investors-put-another-49-million-in-accounting-software-company-xero/|accessdate=15 January 2014}}</ref> This was prior to the company receiving an additional $180 million (NZD) from Thiel and Matrix in October 2013, bringing total funding to more than $230 million.<ref>{{cite news |last=Lunden |first=Ingrid |title=Xero Zeros In On Another $150M To Do Battle With Intuit In The World Of Online SMB Accounting Software | newspaper =Tech Crunch|publisher= |date=13 October 2013 |url=https://techcrunch.com/2013/10/13/xero-zeros-in-on-another-150m-to-do-battle-with-intuit-in-the-world-of-online-smb-accounting-software/|accessdate=15 January 2014}}</ref> Xero raised an additional $100 million from [[Accel Partners|Accel]] and $10.8 million from [[Matrix Partners|Matrix Capital]] in February 25, 2015.<ref>{{cite web |title=Xero Attracts World-Class Investment and Talent to Fuel Growth |website=Xero |url=https://www.xero.com/media/5036812/xero_attracts_world-class_investment_and_talent_to_fuel_growth.pdf |accessdate=25 February 2015}}</ref>On October 5, 2018, Xero announced the [https://www.asx.com.au/asxpdf/20181005/pdf/43yztlbdctms0s.pdf 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 was awarded [https://www.financeasia.com/article/achievement-awards-2018-australia-nz-part-1/448805 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 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.<ref>{{cite web|last=Rogers|first=Claire|title=Xero buys payroll firm to boost Aust growth|url=http://www.stuff.co.nz/business/5323260/Xero-buys-payroll-provider-to-boost-Australian-growth|publisher=Stuff.co.nz|accessdate=19 September 2013}}</ref> It acquired Spotlight Workpapers in July 2012 for a mixture of cash and shares totaling $800,000.<ref>{{cite web|title=Xero’s latest acquisition a ‘compelling’ one for accountants|url=http://www.idealog.co.nz/news/2012/07/xeros-latest-acquisition-compelling-one-accountants|publisher=Idealog|accessdate=19 September 2013}}</ref> The same year it acquired online job, time and invoice management solution WorkflowMax for cash and shares totaling $6 million (NZD).<ref>{{cite news |last=Kepes |first=Ben |title=Xero Raises Another Round and Acquires WorkFlowMax | newspaper =Diversity Limited |publisher= |date=1 February 2012 |url= http://diversity.net.nz/xero-raises-another-round-and-acquires-workflowmax/2012/02/01/ |accessdate=17 January 2014}}</ref><ref>{{cite web|last=Hammond|first=Michelle|title=Xero acquires Max Solutions after raising $15m|url=http://www.startupsmart.com.au/buy-a-business/xero-acquires-max-solutions-after-raising-$15m/201202025260.html|publisher=Startup Smart|accessdate=19 September 2013}}</ref>

On July 20, 2018, [https://www.asx.com.au/asxpdf/20180720/pdf/43wn4tqn5q3szk.pdf Xero announced a strategic alliance with US payroll platform Gusto], a full-service US payroll platform to provide customers access to full-service payroll in all 50 States.


On August 1, 2018, [https://www.asx.com.au/asxpdf/20180801/pdf/43wzn9dc6s54rv.pdf Xero announced the acquisition of Hubdoc], a data capture solution that helps accountants, bookkeepers, and small businesses to streamline administrative tasks such as financial document collection and data entry. Xero paid the acquisition price for Hubdoc in two stages, initially US$60 million consisting of 35% cash and 65% in Xero equity. Xero arranged new debt funding for the cash component of the acquisition price. A second tranche of US$10 million in equity was promised to the Hubdoc’s shareholders in 18 months following the acquisition, subject operational targets and conditions.
===Acquisitions===


Three months later, on November 15, 2018, Xero announced the [https://www.asx.com.au/asxpdf/20181115/pdf/4409kp37fwrpwk.pdf acquisition of Instafile] to provide direct tax filing functionality to accountants and small businesses in the UK. Xero acquired Instafile for £5.25 million (GBP), which will be paid over three years, based in part on the achievement of certain performance targets.
⚫
Xero has acquired several companies since its launch. In July 2011, the company acquired 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.<ref>{{cite web|last=Rogers|first=Claire|title=Xero buys payroll firm to boost Aust growth|url=http://www.stuff.co.nz/business/5323260/Xero-buys-payroll-provider-to-boost-Australian-growth|publisher=Stuff.co.nz|accessdate=19 September 2013}}</ref> It acquired Spotlight Workpapers in July 2012 for a mixture of cash and shares totaling $800,000.<ref>{{cite web|title=Xero’s latest acquisition a ‘compelling’ one for accountants|url=http://www.idealog.co.nz/news/2012/07/xeros-latest-acquisition-compelling-one-accountants|publisher=Idealog|accessdate=19 September 2013}}</ref> The same year it acquired online job, time and invoice management solution WorkflowMax for cash and shares totaling $6 million (NZD).<ref>{{cite news |last=Kepes |first=Ben |title=Xero Raises Another Round and Acquires WorkFlowMax | newspaper =Diversity Limited |publisher= |date=1 February 2012 |url= http://diversity.net.nz/xero-raises-another-round-and-acquires-workflowmax/2012/02/01/ |accessdate=17 January 2014}}</ref><ref>{{cite web|last=Hammond|first=Michelle|title=Xero acquires Max Solutions after raising $15m|url=http://www.startupsmart.com.au/buy-a-business/xero-acquires-max-solutions-after-raising-$15m/201202025260.html|publisher=Startup Smart|accessdate=19 September 2013}}</ref>


==Product==
==Product==

Revision as of 00:55, 27 June 2019

Xero Limited
Company typePublic
ASX: XRO
IndustrySoftware as a Service (SaaS)
FoundedNew Zealand (2006)
Headquarters
Wellington
,
New Zealand
Key people
  • Graham Smith
  • (Chairman of the Board)
  • Rod Drury
  • (Founder & Director)
  • Steve Vamos
  • (CEO)
ProductsAccounting software
Revenue
  • Increase NZ$ 406.58 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 2531
  • (FY MAR. 31, 2019)
WebsiteXero.com
Footnotes / references
[1][2][3][4][5]

Xero is a New Zealand domiciled public technology company, listed on the Australian Stock Exchange[6], listed public software company that 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, Brisban and Perth), two offices in the the United Kingdom (London 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][1]

History

Xero was founded in a Wellington studio apartment by Rod Drury and his personal accountant when they felt that traditional desktop accounting software had become outdated and decided to create a modern cloud-based product.[2] Xero Limited's global headquarters are still located in Wellington.[11]

Originally called Accounting 2.0, the name was unpopular with the company’s staff and the decimal point made registering an internet domain name impossible. Changing the name to Xero also provided a challenge with the domain name, as the existing xero.com domain was a Linkin Park fan site (Xero was Linkin Park’s original name). Rod decided to fly the existing domain administrator to New Zealand from the United States, wined and dined him, and ultimately convinced him to sell the domain for $20,000.[12]

The company entered the Australian market and the United Kingdom in 2008,[13] and United States in 2011.[14] In 2017, Xero surpassed one million customers globally and the following year, in December 2018 Xero hit a million subscribers in its home markets of Australia and New Zealand.

Rod Drury announced he would be stepping down as CEO in March 2018, with Steve Vamos starting the role in April 2018. Rod remains on the board as a non-executive director.

Xero launched its cloud accounting software platform in Asia in 2017, South Africa in 2017 and Canada in 2018.

In June 2018, Xero updated its tagline from ‘beautiful accounting software’ to ‘beautiful business’. More recently in 2019, Xero announced it had hit 1.8 million subscribers, employed 2,500+ people around the world and achieved positive fee cash flow for the first time.

Funding

Xero went public on the New Zealand Exchange on June 5, 2007 with a $15 million (NZD) IPO, gaining 15% on its first trading day.[15] 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] The company focused on the New Zealand market and product and development for its first five years before entering other markets.[7] It went public on the Australian Securities Exchange on November 8, 2012.[3] Xero transitioned to a sole listing on the ASX on February 5, 2018, delisting from the NZX on February 2, 2018. January 31, 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.[16] It raised an additional $4 million (NZD) in 2010 from Peter Thiel's Valar Ventures,[17] who also invested an additional $16.6 million (USD) in February 2012.[18] 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 has raised more than $100 million and had a valuation of approximately $1.4 billion on the NZE as of May 2013.[7][19] This was prior to the company receiving an additional $180 million (NZD) from Thiel and Matrix in October 2013, bringing total funding to more than $230 million.[20] Xero raised an additional $100 million from Accel and $10.8 million from Matrix Capital in February 25, 2015.[21]On October 5, 2018, Xero announced the 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 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 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.[22] It acquired Spotlight Workpapers in July 2012 for a mixture of cash and shares totaling $800,000.[23] The same year it acquired online job, time and invoice management solution WorkflowMax for cash and shares totaling $6 million (NZD).[24][25]

On July 20, 2018, Xero announced a strategic alliance with US payroll platform Gusto, a full-service US payroll platform to provide customers access to full-service payroll in all 50 States.

On August 1, 2018, Xero announced the acquisition of Hubdoc, a data capture solution that helps accountants, bookkeepers, and small businesses to streamline administrative tasks such as financial document collection and data entry. Xero paid the acquisition price for Hubdoc in two stages, initially US$60 million consisting of 35% cash and 65% in Xero equity. Xero arranged new debt funding for the cash component of the acquisition price. A second tranche of US$10 million in equity was promised to the Hubdoc’s shareholders in 18 months following the acquisition, subject operational targets and conditions.

Three months later, on November 15, 2018, Xero announced the acquisition of Instafile to provide direct tax filing functionality to accountants and small businesses in the UK. Xero acquired Instafile for £5.25 million (GBP), which will be paid over three years, based in part on the achievement of certain performance targets.

Product

The key features of Xero accounting software include automatic bank and credit card account feeds, invoicing, accepting payments, accounts payable, expense claims, fixed asset depreciation, purchase orders, and standard business and management reporting. Xero can automatically import bank and credit card statements.[26] It offers a free API that enables customers and 3rd-party software vendors to integrate external applications with Xero. Over 275 3rd-party software vendors have built Xero add-ons.[27] Xero also supports multiple tax rates and currencies.[28] It also incorporates a payroll feature and a projects feature. Additionally, users can access local teams in New Zealand, Australia, Europe and the United States.

All financial data is stored in the cloud on a single unified ledger, allowing users to work in the same set of books regardless of location or operating system.[29] Fast Company featured the software's UI design in a 2012 article, stating that the design is simple and makes it easy for users to get an at-glance idea of real time financial situations.[30] In 2011, Xero released the Xero Touch mobile apps for iOS and Android devices,[31] allowing users to issue invoices while on-site with clients.[32] On August 16, 2016, Xero announced they were partnering with PayPal to allow invoices to be paid via PayPal directly from the invoice.[33]

Awards and recognition

In 2007, Xero received the Overall Partner Solution of the Year for Small Business and was also featured as part of a Microsoft case study.[34] The company was the recipient of two Webby Awards in 2009, including the People's Choice Award for Banking/Bill Pay.[35][36] They were honorees of the 2010 Webby Awards for Web Services & Applications.[37] They received a Fast Company Innovation by Design Award in 2012[38] and was recognized as one of the 10 Smart Financial Apps to Solve Small Business Accounting Challenges by YFS Magazine in 2013.[39][40] Additional awards in 2013 included the Awesome Application Award from the Sleeter Group[41] and the New Zealand Company of the Year from Hi-Tech.[42] In June 2014, Xero topped the Forbes magazine "100 most innovative growth companies" list.[43] Also in 2014, the company was named one of Macworld's recommended online business accounting apps.[44] In January 2015, Xero was named best accounting software, with a score of 83, in the Cloudswave Awards,[45] and for the second time, named New Zealand's company of the Year from Hi-Tech. Xero won Product of the Year at the 2017 British Accountancy Awards and also won Best Overall Fintech platform by the Fintech Breakthrough Awards in 2017. The company was rated by Canstar Blue as Australia's best accounting software four consecutive years from 2015-2018.

See also

References

  1. ^ a b "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 2016 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 d 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. ^ Brooks, Steve (2016-07-20). "Xero grows to $1 Billion revenue -". Enterprise Times. Retrieved 2019-06-27.
  12. ^ "THE UNTOLD STORY: How Xero took a band name and changed accounting for a million companies". Business Insider. Retrieved 2019-06-27.
  13. ^ "Xero Chairman's Address for 2009 Annual Meeting" (PDF). XERO. 23 July 2009. Retrieved 24 May 2016.
  14. ^ "Chairman's Address for 2011 Annual Meeting" (PDF). XERO. 21 July 2011. Retrieved 24 May 2016.
  15. ^ Niesche, Christopher (6 June 2007). "Xero begins strongly". New Zealand Herald. Retrieved 15 January 2014.
  16. ^ Smith, Robert (7 April 2009). "MYOB founder helps Xero raise $23m for global push". National Business Review. Retrieved 15 January 2014.
  17. ^ Wauters, Robin (22 October 2010). "Peter Thiel Invests $3 Million In Xero To Support Its US Expansion". Tech Crunch. Retrieved 15 January 2014.
  18. ^ Wauters, Robin (3 February 2012). "Small business accounting service Xero raises $16.6M". Venture Beat. Retrieved 15 January 2014.
  19. ^ 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.
  20. ^ 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.
  21. ^ "Xero Attracts World-Class Investment and Talent to Fuel Growth" (PDF). Xero. Retrieved 25 February 2015.
  22. ^ Rogers, Claire. "Xero buys payroll firm to boost Aust growth". Stuff.co.nz. Retrieved 19 September 2013.
  23. ^ "Xero's latest acquisition a 'compelling' one for accountants". Idealog. Retrieved 19 September 2013.
  24. ^ Kepes, Ben (1 February 2012). "Xero Raises Another Round and Acquires WorkFlowMax". Diversity Limited. Retrieved 17 January 2014.
  25. ^ Hammond, Michelle. "Xero acquires Max Solutions after raising $15m". Startup Smart. Retrieved 19 September 2013.
  26. ^ Lam, Greg (2 July 2013). "Cloud Accounting Comparison – Data Import and Export". Sleeter. Retrieved 16 January 2014.
  27. ^ McKenzie, Hamish. "Xero: A billion-dollar software company that had five years in stealth at the bottom of the planet". PandoDaily. Retrieved 19 September 2013.
  28. ^ Lam, Greg. "Xero Review". The Small Biz Doer. Retrieved 19 September 2013.
  29. ^ Gorham, Tom. "Xero review". PC Pro. Retrieved 16 January 2014.
  30. ^ LaBarre, Suzanne (25 February 2012). "Xero Reinvents Accounting For Small Businesses, With Superb UI Design". Fast Code Design. Retrieved 15 January 2014.
  31. ^ Fineberg, Seth. "Xero Debuts Mobile App for Android". Accounting Today. Retrieved 9 September 2013.
  32. ^ Smith, Heather (23 May 2013). Xero For Dummies. John Wiley & Sons. p. 35. ISBN 978-1-118-57252-8.
  33. ^ Gagliordi, Natalie. "Xero teams with PayPal for streamlined invoice payments | ZDNet". ZDNet. Retrieved 2016-08-24.
  34. ^ "Software Developer Improves Service Levels With Superior Database Technology, Flexible Licenses". Microsoft Corporation. 10 September 2007. Retrieved 16 January 2014.
  35. ^ Hall, Mitchell (6 May 2009). "Hyperfactory and Xero big winners at 'online oscars'". The National Business Review. Retrieved 15 January 2014.
  36. ^ McBeth, Paul (22 October 2010). "PayPal founder pumps $4 million into Xero". Scoop. New Zealand. Retrieved 15 January 2014.
  37. ^ "2010 – 14th Annual Webby Awards – Award List". The Webby Awards. 2010. Retrieved 15 January 2014.
  38. ^ LaBarre, Suzanne. "2012 Innovation By Design Awards: Service Design". Fast Company. Retrieved 17 January 2014.
  39. ^ "10 Smart Financial Apps to Solve Small Business Accounting Challenges". 4 January 2013. Retrieved 15 January 2014.
  40. ^ Administrator (21 January 2017). "Is xero online accounting suitable for small business". www.digitalgrog.com.au. Retrieved 16 March 2017.
  41. ^ "Awesome Application Award Winners 2013". Retrieved 17 January 2014.
  42. ^ "Xero and Vend big winners at NZ Hi-Tech Awards 2013". National Business Review. 18 May 2013. Retrieved 15 January 2014.
  43. ^ "Most Innovative Growth Companies". Forbes, June 2014
  44. ^ "Top Choice: Our favorite online-based business accounting apps".
  45. ^ "The 10 Best Accounting Software 2015 According to Cloudswave". Cloudswave Blog. Retrieved 2015-10-26.
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