“Xero listed very early, with limited revenues, raising $NZ15 million from 1,100 retail investors — not funds.” Like Craig Walker, “mum and dad” investors would be asked to take a leap of faith based on little more than Drury’s vision and track record. “We kind of threw a bunch of stuff at the wall to see what would stick. We weren’t looking at what other products were doing. We were making it up as we were building.”
Xero founder Rod Drury is back with new start-up investment
They’ll use the funding to upgrade key modelling software, purchase a new 3D printer, and research new 3D scanning technology. She has significant public and private board experience with multiple companies. It depends on human resources in the form of engineers that develop its software and maintain and update its platform, and customer service personnel that provide support. Lastly, as a startup it has relied heavily on funding from investors, raising $355 million from six investors as of February 2015. We are going hard for growth, which means investing ahead of revenue to create a bigger long term business.
Trailblazing with technology
Perhaps not surprising given the size of the country (which Drury calls “a small set of rocks in the South Pacific”) but Drury needed more than that. We’ve got a lot of people who work for us in their 50s and 60s that are also having a really good time, and I started Xero when I was 40. I think your 20s are about building your base experience, trying a few things out, and build that deep, deep skills.
Honored to speak with Rod and founder of…
Our experienced board, executive and leadership teams work to ensure Xero focuses on innovation and performance for our customers. That there has never been a better opportunity to do things globally significant and still enjoy our fantastic lifestyle. If we want better schools and hospitals we simply need to sell more stuff overseas. Working internationally is a great experience and can be a lot of fun. That’s a byproduct of being successful I guess, but I find it a bit weird. I still spend most of my time thinking about software and strategy and getting our product out the door.
The Bowling Club (New Zealand) is a community eatery offering $4 meals—or free for anyone in need and this year’s global winner in the ‘Strengthening community connection’ category. Originally a food truck, it now serves an average of 900 meals per night with a team of 23 staff members. The funding will go towards a new blast chiller and storage to help meet growing community needs. I want to acknowledge Steve’s enormous contribution to Xero’s growth and development as a global business. Steve has overseen significant expansion of Xero and is a highly respected leader.
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In Xero’s case, that three-year revenue growth is a healthy 180%. “Even after all this time, it feels like we’re still at the beginning of an amazing opportunity, and in a strong position as we help to power the global small business economy,” he said. We set startups up for fundrising success, and know how to work with the top VCs.
He has financially supported Republican candidates at various elections, and wrote a book in the 1990s that railed against political correctness. “We’re really proud that they are enthusiastic about our business, understand what we’re doing and that they want to help us,” Drury said at the time. Thiel made his name and fortune as a co-founder of payments provider PayPal, which would later lead him to work with Elon Musk. He was also an early investor in other companies that would become titans – including putting in $US500,000 to become Facebook’s first external investor in 2004. Drury says Winkler was trying to teach him in Melbourne that day in 2009 that you’ll always need much more money than you think.
- In New Zealand’s most populous city, Auckland, there’s an exhibit called The Innovators at the Museum of Transport and Technology (MOTAT).
- In Xero’s case, that three-year revenue growth is a healthy 180%.
- The entire team was coming and going all hours to get Accounting 2.0 off the ground — much to the bemusement of the other residents in the complex.
- Drury says he usually catches up with Thiel a couple of times a year, although they’ve not met in the last 12 months due to time pressures.
- On May 1, 2006, Walker came in for his first day of work at Drury’s mysterious new venture.
We had a company there called Context Connect, and it was just starting to slow down. Active Server Pages 2 came out from Microsoft [and] I always wanted to build a relational accounting engine, so I played with that for two weeks, and it felt really good. I knew that was my next business, but I also knew it wasn’t a quick build and sell to somebody. At that point I really wanted to make some money, so I did Aftermail, the email archiving product, and as I was doing that, I was sort of thinking about how hard and how homemade desktop accounting software felt, so I knew that Xero would be the next one. It’s easier when you’re a large fish in a very small pond, you can get network effects and you can really use your connections to get your business established and you can have good access to talent until you exhaust that pool. You actually have to raise a huge amount of money and, really, build a global platform, and that’s played in our favor although it was super hard work.
Xero raised $23 million in a round of funding in 2009, followed by $4 million in 2010. It entered the U.S. market in 2011, and joined the Australian Securities Exchange in 2012. In 2013 it was reported that it had a valuation of $1.4 billion on the NZE. It then proceeded to acquire several firms, diversifying its portfolio and expanding its capabilities.
I’ve started a few businesses through my career, and you want to run the business, rather than be an accountant, [and so it] seems like a crazy thing to set up the chart of accounts right from the start. I got into computer programming at school, and I think coming from a small set of rocks in the South Pacific, being able to build something with your brain, and that would sell while you’re sleeping, always really appealed to me. “All of these companies have real software-as-a-service revenues with more than $US2 million in annualised recurring revenues – some xero founder well more than $US10 million in annualised recurring revenues,” he says. “Pushpay was founded in 2011 and completed an IPO valuing the company at $NZ50M on the NZX in 2014. Today Pushpay has a market capitalisation of $NZ556M – an 11-fold increase in value in three years.” Xero brought in experts to create an education pack for its client base. The company was armed with ready information to teach small businesses how to find young workers, how to manage them, what the rules are on wages and probation periods — all to help them take on more young people.
Xero founder and former CEO Rod Drury is back in the tech scene with a new venture, Atomic.io. It is his first software-as-a-service investment since stepping down from the top job at the accounting software giant in 2018. The company offers convenience by making life simpler for customers. It enables potential users to participate in a 30-day free trial. It provides updates to its SaaS platform every three to six weeks, and made 1,200 updates in 2016 alone.