New Zealand accounting software provider, Xero (NZL: XRO), is targeting the Australian market to grow its business.
The publicly-listed company's growth has been underpinned by a $NZ23.2 million capital raising with MYOB founder and former CEO, Craig Winkler, purchasing $NZ18 million worth of new shares.
The software vendor predominantly targets the small business sector, an area which CEO, Rod Drury, highlighted as an important part of the economy.
“They just don’t have the tools that give them that focus on cash flow and the ability to manage their business,” he said.
The company has recently set up an office in Melbourne, and Drury intends to establish a presence in most of the main cities. The company is looking to recruit up to 30 staff in Australia.
“We’re working with partners all over Australia,” he said.
Xero also recently struck up a partnership with Telstra that will see them become the supplier of accounting software to customers on the T-Suite service offering.
“We’ve done a similar deal with Telecom New Zealand and when we contacted Telstra they had been watching what we’ve been doing,” he said. “We think carriers are a natural channel for software-as-a-service because they already have an online relationship with millions of customers.
“This seems to be the year where telecommunications providers start rolling out sophisticated services to small businesses.”
This year, Xero is also looking to further grow its partner network. It has about 20 active partners in Australia, and Drury said he expected to grow that to several hundred over the next few months.
“The accounting channel is an important one. We’ve built quite a bit of software that makes accountants more effective as well,” he said. “We’ve very quickly grown to 6000 customers including 2000 in the UK.”