Cloud-based accounting software provider Xero has completed a $20 million round of financing through a placement to existing strategic investors, which will allow the company to expand its global reach, particularly in Australia, the U.K. and the U.S.
Xero officially entered the U.S. market last year, opening an office in San Francisco and hiring former Sage Simply Accounting executive Jamie Sutherland to head its U.S. operations.
Growth in regions outside New Zealand is one of the main drivers behind the company’s recent forecast that it expects revenue for the full year ending March 31, 2012 to double 2011’s revenue of $9.3 million. The company—which is traded publicly on the New Zealand Stock Exchange—claims to have over 60,000 users worldwide.
Chief executive and co-founder Rod Drury believed the time was right for a large, global push. “I feel we’ve hit the point where we’ve really proven the technology to our customers,” he said. “Now half of our revenue is from offshore, so we are incubating here and expanding more abroad. Over the past year we’ve had good entry into the U.S., and now we can see from the great feedback we are getting from the accounting community, now is the time to push forward.”
Xero currently has a half-dozen dedicated staff in the U.S., with plans to grow that number as well as expand its accountant partners.
“It’s a global model that we have and we are going to execute,” said Sutherland. “I’ve been building the team here and we can add much more depth. We thought about specific growth opportunities, but we’ve only had talks on what we want to do. Largely it doesn’t change our overall direction. We have a platform that caters to bookkeepers and small businesses. Also, we have a lot of other vendors large and small that are excited to work with us. We’re opening up a lot of doors to potential partners, and of course building our team here [in the U.S.].”
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