Xero Limited is a

New Zealand New Zealand () is an island country in the southwestern Pacific Ocean. It consists of two main landmasses—the North Island () and the South Island ()—and List of islands of New Zealand, over 600 smaller islands. It is the List of isla ...

technology company A technology company (or tech company) is a company that focuses primarily on the manufacturing, support, research and development of—most commonly computing, telecommunication and consumer electronics–based—technology-intensive products and ...

that provides

cloud-based Cloud computing is "a paradigm for enabling network access to a scalable and elastic pool of shareable physical or virtual resources with self-service provisioning and administration on-demand," according to International Organization for ...

accounting software Accounting software is a computer program that maintains accounting, account books on computers, including recording Financial transaction, transactions and Balance (accounting), account balances. It may depend on virtual thinking. Depending on ...

for small businesses. The company has offices in New Zealand,

Australia Australia, officially the Commonwealth of Australia, is a country comprising mainland Australia, the mainland of the Australia (continent), Australian continent, the island of Tasmania and list of islands of Australia, numerous smaller isl ...

, the United Kingdom, the United States, Canada, South Africa and Singapore. Xero's products are based on the

software-as-a-service Software as a service (SaaS ) is a cloud computing service model where the provider offers use of application software to a client and manages all needed physical and software resources. SaaS is usually accessed via a web application. Unlike oth ...

model and sold by subscription, based on the type and number of entities managed by the subscriber. The products are used in over 180 countries.

History

In 2006, Xero was founded by

Rod Drury Rodney Kenneth Drury (born 1966) is a New Zealand technology entrepreneur, predominately known for his association with accounting software company, Xero. Drury was CEO of Xero until 2018, after founding the company in 2006. Drury made his ini ...

and Hamish Edwards in

Wellington Wellington is the capital city of New Zealand. It is located at the south-western tip of the North Island, between Cook Strait and the Remutaka Range. Wellington is the third-largest city in New Zealand (second largest in the North Island ...

, where Xero Limited's headquarters are still located. The company was originally called Accounting 2.0. By 2017, Xero had more than one million customers globally, and the following year, it had more than one million subscribers in Australia and New Zealand. In April 2018, Steve Vamos was appointed as CEO, replacing Rod Drury who remained on the board as a non-executive director until 2023. 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 StubHub is an American ticket exchange and resale company. It provides services for buyers and sellers of tickets for sports, concerts, theater, and other live entertainment events. By 2015, it was the world's largest ticket marketplace. While ...

. In 2019, the company announced it had over two million global subscribers, and three million subscribers in September 2021. 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. 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. The company announced it had finished its job cuts by November 2023, reducing headcount to 4,242 staff. In May 2024, the company announced it had achieved a Rule of 40 outcome of 41.0%, followed by a Rule of 40 outcome of 43.9% in November 2024.

Product

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. It provides automatic bank feeds, invoicing, accounts payable, expense claims, fixed asset depreciation, purchase orders, bank reconciliations, and standard business and management reporting. In 2011 and 2012, the ''Xero Touch'' mobile apps for iOS and Android devices were released. In the 2019 financial year, Xero offered services relating to Making Tax Digital in the United Kingdom, ''Single Touch Payroll'' in Australia, and ''Payday Filing'' in New Zealand.

Funding

Xero went public on the

New Zealand Exchange New Zealand's Exchange (), known commonly as the NZX, is the national stock exchange for New Zealand and a publicly owned company. NZX is the parent company of Smartshares, and Wealth Technologies. , the NZX had a total of 179 listed securiti ...

on 5 June 2007, with a

IPO An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...

, gaining 15% on its first trading day. It went public on the

Australian Securities Exchange Australian Securities Exchange Ltd (ASX) is an Australian public company that operates Australia's primary Exchange (organized market), securities exchange, the Australian Securities Exchange (sometimes referred to outside of Australia as, or c ...

(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. In September 2019, the

market capitalisation Market capitalization, sometimes referred to as market cap, is the total value of a publicly traded company's outstanding common shares owned by stockholders. Market capitalization is equal to the market price per common share multiplied by ...

of Xero on the ASX exceeded , and it was ranked as the third most valuable publicly listed New Zealand company. Xero has also received funding from various investors. In 2009, it received of funding led by MYOB founder, Craig Winkler. It raised an additional in 2010 from

Peter Thiel Peter Andreas Thiel (; born 11 October 1967) is an American entrepreneur, venture capitalist, and political activist. A co-founder of PayPal, Palantir Technologies, and Founders Fund, he was the first outside investor in Facebook. According ...

's Valar Ventures who also invested an additional 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. The company raised more than $100 million at a valuation of approximately $1.4 billion on the NZE by May 2013. This valuation was before receiving an additional 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 in convertible notes, more than previously raised by a New Zealand or Australian company not listed in the United States.

Acquisitions and partnerships

In July 2011, Xero acquired the Australian online payroll provider Paycycle for a mixture of cash and shares totaling , to integrate the company's products into its services. It acquired Spotlight Workpapers in July 2012 for a mixture of cash and shares totaling $800,000. In July 2018, Xero formed a partnership with US payroll platform Gusto. In August 2018, it acquired Hubdoc, a data capture application. In November 2018, it acquired cloud-based accounts preparation and tax filing application Instafile for . In August 2020, Xero acquired Waddle, an Australian-based invoice financing startup, for . 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. In March 2023, Xero announced it was cutting jobs and closing the Waddle app. In November 2021, it acquired inventory management provider Locate Inventory for US$19 million, and in December 2021, Xero announced it was acquiring Canadian tax software provider, TaxCycle, for . In November 2022, Xero announced the establishment of a technology base in India in partnership with technology outsourcing company

Infosys Infosys Limited is an Indian multinational corporation, multinational technology company that offers business consulting, information technology, and outsourcing services. Founded in 1981 in Pune, the company is headquartered in Bengaluru. On ...

. The India technology base includes engineering and developer roles. In September 2024, Xero announced the acquisition of cloud-based reporting, insights and analytics platform Syft Analytics for up to US$70 million.

References

External links