Xero has attracted a $26.4 million investment from U.S.-based venture capital firm Technology Crossover Ventures.
The investment was made in New Zealand, where Xero is headquartered. According to a filing with the New Zealand Stock Exchange, TCV bought its shares from Matrix Partners, another U.S.-based investment firm, which reduced its stake in Xero from 9.8 to 8.5 percent (making TCV’s share 1.3 percent).
“Surpassing one million subscribers, Xero is transitioning to become a global platform primed to service millions of small businesses,” said Xero chief financial and operating officer Sankar Narayan, commenting on the investment in an emailed statement. “It is routine that some early-stage investors will rebalance their portfolios and we’re thrilled to receive strong support from new investors who are ready to join Xero for its next phase of growth.”
TCV declined to comment for this story as it does not discuss investments, but a spokesperson for the company called Australia/New Zealand an “attractive market,” and noted the firm has also invested in Australia-based travel and hospitality software company SiteMinder. TCV has also invested in accounting-related software companies such as Avalara, FinancialForce and Payoneer.
Xero has been public in its homeland since 2007 and in Australia since 2012. The company’s U.S. IPO was first planned for 2015, then pushed to 2016, and has been shelved for now with no definite date announced.
In November, the software provider completed the migration of its platform to Amazon Web Services, transferring 1.4 petabytes of data. Shortly after the move, Xero surpassed 1 million subscribers, slowly but surely catching up to its main U.S. competitor QuickBooks Online, which surpassed 1.5 million last year.