Xero, the global leader in online accounting software, reported significant growth for the company's fiscal year ended March 31, 2014. Operating revenue increased to $57.6 million - an 83 percent increase from last year. Additionally, annualized customer committed subscriptions jumped by 87 percent to $80.6 million.
Xero now turns its focus on the important US market, having already established itself as the leading online accounting software provider in the United Kingdom, Australia and New Zealand. Strong growth is expected to continue in these markets.
This substantial growth shows that Xero's cloud accounting and recurring revenue model are a winning combination for small businesses and accounting professionals. To add to this successful fiscal year, Xero raised $150 million in funding, launched innovative offerings, strengthened its executive bench, partnered with a host of best-in-class companies and earned numerous awards.
"Our investments in technology, operations and partnerships are paying off, as evidenced by our growth," said Peter Karpas, CEO, Xero North America. "But our core success lies in the fact that we work closely with our customers to better understand their pain points and create beautifully-designed tools that take the dread and hassle out of accounting. We've also created an ecosystem like no other that lets business owners choose best-in-class add-on apps that, when integrated with Xero, give them a holistic, real-time view of their finances so they can make better business decisions."
Raised $150 Million in Funding
Xero's momentum mirrors the rapid acceleration in the adoption of cloud accounting. A recent Xero survey revealed that 55 percent of accounting professionals now offer their small business clients cloud-based accounting solutions versus 32 percent two years ago. The combination of the burgeoning market and Xero's global success spurred another capital raise of $150 million in 2013, including investment by Peter Thiel-backed Valar Ventures, Matrix Capital Management and additional investors.
Built Strong Executive Bench
To support the company's growth in the U.S., Xero strengthened its executive bench and ramped up recruiting significantly in 2013. In February 2014, Xero announced the appointment of Peter Karpas, a former PayPal and Intuit veteran, as CEO of North America. Additionally, Chris Liddell, former Microsoft and GM CFO, was named Chairman of the Board and Bill Veghte, current EVP (Enterprise Group) at HP was named Director to the Board.
Grew Best-in-Class Partner Ecosystem
An important component of Xero's success is the strength of its 300+ add-on partnerships, which makes up one of the most comprehensive, well-integrated small business ecosystems in the world. Most recently, Xero announced integrations with Square, Stripe, Manilla, Squarespace and Expensify, helping joint small business customers improve their accounting, cash flow and online visibility.
Launched Powerful New Products, Services and Features
Throughout the past fiscal year, Xero also rolled out powerful new services, products and features including:
- Payroll in Xero helps streamline workflow between accounting professionals and their clients by integrating all aspects of payroll into Xero's accounting solution.
- Xero's QuickBooks Conversion offers four million small business and accounting professionals the ability to free themselves from QuickBooks data, seamlessly moving financials into the cloud with Xero's accounting platform.
- Additionally, time-saving enhancements such as Xero Files, a simple way to store business documents in Xero, Purchase Orders, which better manages the ordering and paying for goods, and a redesigned Xero Touch iOS mobile app, which helps connect users in real-time to accounting professionals, have helped SMBs around the world improve efficiency.
Received Industry Accolades
As a result of these product innovations, Xero received several high-profile awards and reviews throughout the year including:
- Accounting Today's 2013 Top New Products: Honorable Mention -- Xero Touch, Mobile category.
- CPA Practice Advisor's 5-Star review 2013 (for Software as Service).
- PC World/MacWorld's "Top Choice" for best online-based business accounting apps.
Xero is beautiful, easy-to-use online accounting software for small businesses and their advisors. The company has over 250,000 paying customers in more than 100 countries around the world. The Xero US team is headquartered in San Francisco. Xero is hosted with Rackspace in Chicago.