Global leader: Rod Drury
Core Activity: Online accounting applications
Revenue: NZ$134,000 (FY08 ended March)
Key customers: NZ Drug Foundation, Silverstripe, Mark Inglis — double amputee Mt Everest climber who runs three businesses on Xero; Middle Peak, Peak Fuel and Limbs4all, Ian Taylor from Animation Research Ltd, Oscar Kightley from Island Boy Entertainment, Norm Hewitt, The Outsourced Office
Employees: 57 full-time (52 in New Zealand, five in London)
Xero is regarded by local ICT watchers as one of the great hopes for development of a New Zealand software industry, not only through its own success but by setting an example of what can be achieved by a local company. The company also serves as a test of the public acceptability of the concept of software-as-a-service.
Its comprehensive suite of accounting software runs entirely online. The suite is aimed initially at the small and “micro” business (companies of 20 staff or less and individuals, as seen above), but once more advanced capabilities such as planning are added, some analysts see a potential for it to rise to the main part of the small-to-medium enterprise market.
Xero founder Rod Drury is a tireless promoter of the commercial potential of New Zealand software. He was named Entrepreneur of the Year in the 2006 and 2007 PricewaterhouseCoopers NZ HiTech Awards.
Xero was floated on the NZ Stock Exchange in 2007, with a warning that investors should not expect a profit for the first three years. Success for the company has been mixed, with higher-than-forecast growth in use of the service, but lower than expected income owing to a price reduction.
In October 2007 Xero set up a Christchurch-based account manager for the South Island as well as a London office, following the launch of the UK version of its applications. Shortly after the launch the company secured Institute of Chartered Accountants in England and Wales accreditation.
In August 2008 Xero was named in the Top Ten Best Application User Interfaces of 2008 by the Nielsen Norman Group, as well as an honourable mention in the Design in Business awards.
Xero is targeting its service increasingly at the export market, with the UK seen as the major opportunity. An Australian version of the product is scheduled to be released this year and a global version in early 2009. Stephen Bell