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Xero (company)

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Xero Limited
Company typePublic
ISINNZXROE0001S2
IndustrySoftware as a service
Founded2006; 18 years ago (2006) in Wellington, New Zealand
Founders
Headquarters
Wellington, New Zealand
Key people
ProductsAccounting software
RevenueIncrease NZ$1.399 billion (2023)
Increase NZ$57.29 million (2023)
Decrease NZ$−113.5 million (2023)
Total assetsIncrease NZ$2.65 billion (2024)
Total equityIncrease NZ$1.185 billion (2024)
Number of employees
4,242 (2024)
Websitexero.com
Footnotes / references
[1][2][3][4][5][6]

Xero Limited is a New Zealand–based technology company that provides cloud-based accounting software for small businesses. The company has offices in New Zealand, Australia, the United Kingdom, the United States, Canada, South Africa and Singapore.[7][8] Xero's products are based on the software-as-a-service model and sold by subscription, based on the type and number of entities managed by the subscriber.[9] The products are used in over 180 countries.[10][11]

History

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In 2006, Xero was founded by Rod Drury and Hamish Edwards in Wellington,[12][13][14] where Xero Limited's headquarters are still located.[15] The company was originally called Accounting 2.0.[14]

By 2017, Xero had more than one million customers globally,[16] and the following year, it had more than one million subscribers in Australia and New Zealand.[17] In April 2018, Steve Vamos was appointed as CEO, replacing Rod Drury who remained on the board as a non-executive director until 2023.[18] Vamos announced in November 2022 that he would step down in February 2023 and be replaced by Sukhinder Singh Cassidy, a former executive of Google and StubHub.[19][20]

In 2019, the company announced it had over two million global subscribers,[21] and three million subscribers in September 2021.[22]

In March 2023, Sukhinder Singh Cassidy, the CEO of Xero, announced the removal of 700-800 roles across Xero, representing approximately 15% of the employee base.[23] At this time, the company reportedly had more than 3.5 million subscribers and about 4,500 staff across offices in New Zealand, Australia, North America, the UK and southeast Asia.[24] The company announced it had finished its job cuts by November 2023, reducing headcount to 4,242 staff.[25]

Product

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The 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.[26] It provides automatic bank feeds, invoicing, accounts payable, expense claims, fixed asset depreciation, purchase orders, bank reconciliations, and standard business and management reporting.[27]

In 2011 and 2012, the Xero Touch mobile apps for iOS and Android devices were released.[28]

In the 2019 financial year, Xero offered services relating to Making Tax Digital in the United Kingdom,[29] Single Touch Payroll in Australia,[30] and Payday Filing in New Zealand.[31]

Funding

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Xero went public on the New Zealand Exchange on 5 June 2007, with a NZ$15 million IPO, gaining 15% on its first trading day.[32] It went public on the Australian Securities Exchange (ASX) on 8 November 2012.[2][33]

Xero transitioned to a sole listing on the ASX on 5 February 2018, delisting from the NZX on 2 February 2018.[34] In September 2019, the market capitalisation of Xero on the ASX exceeded NZ$10 billion, and it was ranked as the third most valuable publicly listed New Zealand company.[35]

Xero has also received funding from various investors. In 2009, it received NZ$23 million of funding led by MYOB founder, Craig Winkler.[36] It raised an additional NZ$4 million in 2010 from Peter Thiel's Valar Ventures who also invested an additional US$16.6 million in February 2012.[37] It raised $49 million in a funding round in November 2012 with the largest amounts coming from Peter Thiel and Matrix Capital.[38] The company raised more than $100 million at a valuation of approximately $1.4 billion on the NZE by May 2013.[39][40] This valuation was before receiving an additional NZ$180 million from Thiel and Matrix in October 2013, bringing total funding to more than $230 million.[41] Xero raised an additional $100 million from Accel and $10.8 million from Matrix Capital on 25 February 2015.[42] On 5 October 2018, Xero announced a settlement of US$300 million in convertible notes, more than previously raised by a New Zealand or Australian company not listed in the United States.[43]

Acquisitions and partnerships

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In July 2011, Xero acquired the Australian online payroll provider Paycycle for a mixture of cash and shares totaling NZ$1.9 million, to integrate the company's products into its services.[44] It acquired Spotlight Workpapers in July 2012 for a mixture of cash and shares totaling $800,000.[45]

In July 2018, Xero formed a partnership with US payroll platform Gusto.[46] In August 2018, it acquired Hubdoc, a data capture application.[47] In November 2018, it acquired cloud-based accounts preparation and tax filing application Instafile for £5.25 million.[48]

In August 2020, Xero acquired Waddle, an Australian-based invoice financing startup, for A$80 million. The payment included $31 million in cash and $49 million in earnout payments. Waddle allows small businesses to access loans secured by their accounts receivables.[49][50] In March 2023, Xero announced it was cutting jobs and closing the Waddle app.[51]

In November 2021, it acquired inventory management provider Locate Inventory for US$19 million,[52] and in December 2021, Xero announced it was acquiring Canadian tax software provider, TaxCycle, for CA$75 million.[53]

In November 2022, Xero announced the establishment of a technology base in India in partnership with technology outsourcing company Infosys.[54] The India technology base includes engineering and developer roles.[54]

See also

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References

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  1. ^ Laugesen, Ruth (17 October 2013). "From Xero a hero". New Zealand Listener.
  2. ^ a b Barwick, Harrish (8 November 2012). "NZ-based SaaS provider Xero lists on ASX". Computer World. Retrieved 15 January 2014.
  3. ^ "Xero Limited 2018 Annual Report" (PDF). Retrieved 24 May 2016.
  4. ^ "Xero Limited 2018 Interim Report" (PDF). Retrieved 17 March 2018.
  5. ^ "ASX" (PDF).
  6. ^ "Xero Limited Annual Report FY23". Xero Limited. Retrieved 18 May 2023.
  7. ^ Mckenzie, Hamish (1 May 2013). "Xero: A billion-dollar software company that had five years in stealth at the bottom of the planet – New Zealand". Bamboo Innovator. Retrieved 4 November 2022.
  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. 20 July 2016. Retrieved 30 May 2018.
  11. ^ Ryan, Holly (9 May 2018). "Xero halves losses, closes in on profitability". The New Zealand Herald. ISSN 1170-0777. Retrieved 12 July 2019.
  12. ^ "No guts, no glory for Xero boss". Stuff. 20 September 2014. Retrieved 1 March 2020.
  13. ^ 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.
  14. ^ a b "THE UNTOLD STORY: How Xero took a band name and changed accounting for a million companies". Business Insider. Retrieved 27 June 2019.
  15. ^ Brooks, Steve (20 July 2016). "Xero grows to $1 Billion revenue -". Enterprise Times. Retrieved 27 June 2019.
  16. ^ Shaw, Aimee (29 March 2017). "Accounting software firm Xero surpasses one million users worldwide". ISSN 1170-0777. Retrieved 12 July 2019.
  17. ^ "Xero hits million mark for trans-Tasman subscribers". New Zealand Reseller News. Retrieved 12 July 2019.
  18. ^ Ryan, Holly (4 March 2018). "Xero CEO Rod Drury stepping down". The New Zealand Herald. ISSN 1170-0777. Retrieved 12 July 2019.
  19. ^ "Xero appoints new CEO as Vamos set to depart". NBR | The Authority since 1970. 10 November 2022. Retrieved 15 November 2022.
  20. ^ Ruth, Jenny (11 November 2022). "Xero shares plunge on CEO Steve Vamos' imminent departure". businessdesk.co.nz. Retrieved 15 November 2022.
  21. ^ Waters, Cara (7 November 2019). "'A big milestone': Xero hits two million subscribers, revenue jumps". The Sydney Morning Herald. Retrieved 4 September 2020.
  22. ^ Chanthadavong, Aimee (11 November 2021). "Xero posts half-year net loss as investment in product development grows". ZDNet. Retrieved 18 May 2022.
  23. ^ "Reshaping Xero to enable disciplined growth and focus". Xero. 9 March 2023. Retrieved 12 November 2023.
  24. ^ "Xero announces plan to cut up to 800 jobs". RNZ. 9 March 2023. Retrieved 8 May 2024.
  25. ^ Stevenson, Rebecca. "Xero adds deep global expertise, ends painful job cuts". businessdesk.co.nz. Retrieved 8 May 2024.
  26. ^ Lam, Greg (2 July 2013). "Cloud Accounting Comparison – Data Import and Export". Sleeter. Archived from the original on 13 July 2018. Retrieved 16 January 2014.
  27. ^ Sherman, Matt. "Xero Review". Merchant Maverick.
  28. ^ Fineberg, Seth (2 October 2012). "Xero Debuts Mobile App for Android". Accounting Today. Archived from the original on 23 October 2013. Retrieved 9 September 2013.
  29. ^ "Xero is preparing for Making Tax Digital". Accountancy Age. 15 November 2018. Retrieved 12 July 2019.
  30. ^ Zaharov-Reutt, Alex (28 November 2018). "Xero says 'small businesses rushing to go digital as STP deadline approaches'". iwire.
  31. ^ "Tax refund agents weigh futures as IRD prepares huge software release". New Zealand Reseller News. Retrieved 12 July 2019.
  32. ^ Niesche, Christopher (6 June 2007). "Xero begins strongly". New Zealand Herald. Retrieved 15 January 2014.
  33. ^ Geron, Tomio. "Peter Thiel's Valar Ventures Joins $67 Million Round For Xero". Forbes. Retrieved 22 January 2020.
  34. ^ "Shareholder update on Xero listing". NZX. 22 January 2018. Retrieved 4 September 2020.
  35. ^ Pullar-Strecker, Tom (6 September 2019). "Xero joins elite club as value surges past $10 billion". Stuff.co.nz. Retrieved 9 August 2020.
  36. ^ Sharp, Ari (7 April 2009). "MYOB founder buys into rival". The Sydney Morning Herald. Retrieved 22 January 2020.
  37. ^ Wauters, Robin (22 October 2010). "Peter Thiel Invests $3 Million In Xero To Support Its US Expansion". Tech Crunch. Retrieved 15 January 2014.
  38. ^ Tanwani, Maneka. "Xero secures US$141M from Accel Partners, Matrix Capital Management". e27. Retrieved 15 December 2020.
  39. ^ 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.
  40. ^ 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.
  41. ^ 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.
  42. ^ "Xero secures US$141M from Accel Partners, Matrix Capital Management". e27. Retrieved 22 January 2020.
  43. ^ "Achievement Awards 2018 – Australia/NZ Part 1 | australia awards, achievement awards, awards, australia, new zealand". FinanceAsia. Retrieved 4 July 2019.
  44. ^ Rogers, Claire (21 July 2011). "Xero buys payroll firm to boost Aust growth". Stuff.co.nz. Retrieved 19 September 2013.
  45. ^ "Startup profile: Richard Francis from Spotlight Reporting". Futurebooks. 30 September 2015. Retrieved 18 December 2020.
  46. ^ Gray, Jamie (19 July 2018). "Xero forms alliance with US payrolls platform Gusto". ISSN 1170-0777. Retrieved 12 July 2019.
  47. ^ "Xero acquires Hubdoc". Finextra Research. 1 August 2018. Retrieved 12 July 2019.
  48. ^ Brooks, Steve (16 November 2018). "Xero acquires Instafile for £5.25 million -". Enterprise Times. Retrieved 22 January 2020.
  49. ^ Waters, Cara (25 August 2020). "Xero snaps up small business lender Waddle for $80 million". The Sydney Morning Herald. Retrieved 1 September 2020.
  50. ^ Chanthadavong, Aimee. "Xero to acquire Waddle for AU$80 million". ZDNet. Retrieved 16 September 2020.
  51. ^ King, Philip. "Xero to cut hundreds of jobs, close Waddle app". accountantsdaily.
  52. ^ Hood, Daniel (12 November 2021). "Xero acquires inventory mgmt. provider". accounting today. Retrieved 19 July 2022.
  53. ^ Scott, Josh (28 December 2021). "Xero to acquire Calgary's TaxCycle in $75 million CAD deal to expand Canadian presence". betakit. Retrieved 19 July 2022.
  54. ^ a b "Xero establishes a technology base in India". Retrieved 29 November 2022.
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