New Zealand–based online accounting software provider Xero said on October 13 it has raised $150 million to fund a major expansion in the United States.
Xero US headquarters, which recently moved into a new 25,000-square-foot facility in San Francisco, reported the new capital was raised from existing shareholders Valar Ventures (backed by PayPal cofounder Peter Thiel) and Matrix Capital Management as well as other investors in the United States and New Zealand. US investors accounted for $123 million of the $150 million raised.
"Having empowered hundreds of thousands of small and medium-sized businesses in New Zealand, Australia, and the United Kingdom, Xero is poised to do the same for its twenty-nine million potential customers in the United States", David Goel, managing member of Matrix Capital Management, said in a written statement.
Xero now has 100 employees across the United States, including in Los Angeles, New York, and Austin. A new office opened October 14 in Denver that will help bolster Xero's US customer service team and the company's global 24/7 support.
Xero also stated the new funding will be used to go head-to-head with its main online accounting software rival, Mountain View, California–based Intuit and its flagship product, QuickBooks.
On October 8, Xero launched a free conversion service that will enable small businesses to migrate their QuickBooks data into Xero's Cloud accounting service. Xero also announced last week it experienced 89 percent global growth in customers for the year up to September 30 as well as an 84 percent increase in global revenues.
"This new capital will help us to continue our mission of bringing powerful and accessible financial and billing systems to small businesses and their financial advisors anytime, anywhere", Xero US President Jamie Sutherland said in a written statement.