In accordance with the expectations put upon a publicly listed company, Xero has just released its operating update.

It’s worth reading for all start-ups and SaaS players, if for no other reason than to see the level of professionalism that is required to build businesses acceptable to the trading floor.

No doubt some  negative folks out there will deride the seemingly small number of paying customers but they should remember that early stage start-ups are all about building systems and processes, customers come later. Build it and they’ll come……

Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

  • How does this track against the IPO forecast Ben? I do agree that numbers are not significant at this point and that if anything they want a small userbase while things are maturing, but being accountable to the forecast is not being negative.

    I guess I’ll go and dig out the IPO docs unless you have the info handy.

  • Answers coming soon….

  • Bruce – I reckon Xero should be applauded for such a quick post-period end report and for being so upfront with the numbers. I believe that if any projections made in the IPO documents were not reached, they would have to disclose as such. While there are some fundamental requirements of a PLC it seems Xero is doing their utmost to keep people informed. I also questioned them about their targets and recieved this reply

    “We are very pleased with the acceptance we’ve had from accountants in this short time. It’s a great foundation for us,

    The next phase of the business is to drive end user demand in time for the critical period. We wrote the release to give as much information as we know so I hope the strategy is clear. “

  • I don’t disagree that they are disclosing, just that the measure of their success has to be made against something.

    The IPO full year revenue figure was 550K @ per user $75 a month. This is ~611 full year users at that rate.

    I’d say they’re exactly on track, and that the growth rate is probably ramping up significantly so they’re quite probably ahead.

    The price per user is no longer $75 which impacts revenue but I don’t believe revenue is a good benchmark at this point (as long as it is growing).

  • A nice neutral, non-emotional assessment I’d say Bruce. Well done!

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