Xero President Tony Ward on helping small businesses succeed

Xero, a cloud-based accounting software platform, helps 3.3 million subscribers access real-time financial data anytime, anywhere, and on any device. Supporting small business owners and their advisors in over 180 countries, the company partners with Stripe to power subscription billing, invoicing, and more.

We spoke with Tony Ward, the company’s Americas president, about Xero’s support for small businesses, its relationship with accountants and bookkeepers, and why it partners with Stripe.

Products used

    Payments
    Connect
    Billing
Global
Enterprise

How has e-commerce impacted the way Xero thinks about its product and platform development?

Everything we build at Xero is designed to help small businesses around the world grow and thrive. During the pandemic, many small businesses saw the advantages of running an e-commerce business and had to adapt as many consumers shifted from brick-and-mortar stores to online shopping. With the Xero platform and products, we’re making it easier for customers to start, grow, and manage their e-commerce or goods-based business, by giving them better visibility into their financial performance. As we work towards our e-commerce vision, we’re enhancing our inventory solution and integrations with app partners to give customers a complete picture of their profit margins by product and channel – all in one place.

In fact, last year we announced the acquisition of LOCATE Inventory, a US cloud-based inventory management provider. The acquisition will embed LOCATE’s inventory and e-commerce talent and capability within Xero to enhance Xero’s inventory management offering and meet small-business demand for inventory and cash-flow management tools.

As the financial system has moved increasingly online, how is Xero keeping pace?

Building the Xero platform in the cloud from day one made it possible to do what was previously impossible in the accounting world: to seamlessly connect the islands of data that small businesses have in their ledger, bank, and other applications. By connecting these data points in one place, businesses and advisors could finally get a true view of their financial positions and access new services.
To keep pace as things move increasingly online, we know that the best small-business platforms today are those that treat both their own platform and their ecosystem as the key drivers to overall business success. This creates a network of innovation that is far richer and more cohesive. Our Xero platform consists of a thriving ecosystem of more than 1,000 connected apps, more than 300 connections to banks and financial service providers, and tens of thousands of partners using our open APIs. While small businesses have traditionally lacked the resources, access to capital, and technology that enable them to compete on level footing with larger companies, it doesn’t have to be that way any more. Both startups and small businesses can today be agile and access the tools, information, and resources that were traditionally only available to big business.

How have you maintained close collaborations with accountants and bookkeepers?

Helping small businesses succeed starts with the accountants and bookkeepers who serve them. Our focus has always been on putting people first, and we use technology to bring small businesses and their advisors closer together. In our industry, advancements in artificial intelligence, machine learning, and automation are surfacing actionable insights to help small businesses.
By working closely with our accounting and bookkeeping partners, we help them work more efficiently and deliver real-time data and insights that can help small-business clients and empower them to thrive long term.
As a result, Xero’s technology has become a force for good for accountants and bookkeepers, their small-business clients, and the broader economy.

Tell us about some of the products you’ve developed, beyond bookkeeping and accounting tools that are helping small businesses?

We’re really proud of Xero Analytics and Analytics Plus, which are powerful cash-flow forecasting and analysis tools that help small businesses understand their financial health in real time and plan for the future with their advisors.

Xero Analytics combines our short-term cash-flow tool, which visually projects cash flow over 30 days, with our business-snapshot tool, providing up-to-date insights on business performance. Short-term cash flow in Xero Analytics Plus can detect and predict regular cash expenses and income over the next week, month, or quarter. If you are a business owner and you run out of cash, it’s too late. Through these features, we can provide a “radar for icebergs” to help businesses avoid these scenarios.

As more small businesses move to the cloud, are they adopting software like Xero’s at a higher rate compared to even a few years ago?

Xero continues to see growth in all of our key markets and specifically in the Americas, we’re really pleased with the progress we’ve made in driving further adoption of Xero. We signed significant deals with accounting partners including Liberty Tax Service, Bernard Robinson & Company, and H&R Block. These firms have selected Xero as their preferred cloud accounting software and help us reach an even greater number of small businesses throughout the country.

How are you thinking about North American expansion moving forward?

In North America, we focus on building up our local communities. This means we have Xero team members on the ground across key markets to work closely with our accounting and bookkeeping partners to make sure we’re supporting them throughout their Xero journey. We are proud of the true community we’ve created and how we show up for our accounting and bookkeeping partners. Our accounting and bookkeeping partners love our human approach. Many people within the Xero team have owned a small business or come from a small business family, so we “get it” and understand where our customers are coming from.

What are the top things Xero wants to accomplish for small businesses in 2022?

Helping small businesses move from a “do it yourself” to a “do it together” mindset. This means partnering with a trusted advisor like an accountant or bookkeeper, who can help them gain a competitive edge and make well-considered decisions on how to operate successfully.
Another is to continue delivering rich, meaningful financial data and insights that will help empower small businesses. To achieve this, we work closely with our accounting and bookkeeping partners on how to educate small-business clients on using financial data to add further value and drive business outcomes.

Lastly, we want to help small businesses cut through the noise. Coming out of the pandemic, this next phase might feel even harder for small businesses than at the start of COVID. Our goal is to help them get back on a path with greater control over their finances and the resources they need to run their business successfully.

You recently launched the Xero app store. Tell us a bit about the decision to build that marketplace and what you hope to accomplish?

Launching the Xero App Store last year was a big milestone for us. We want the Xero App Store to be the place where small businesses go to discover and buy Xero-connected apps and where developers go to grow their business. Today the Xero App Store provides access to enhanced functionality through machine-learning-powered search, access to seamless billing capabilities, and targeted recommendations.

Our research shows that small businesses connected to apps experience greater revenue growth than businesses with no app connections. With more than 1,000 connected apps, there's never been a better time for Xero to provide additional functionality to enhance the experience for both our app partners and small businesses and their advisors. Launching the Xero App Store was the centrepiece of the next phase of Xero’s evolution to build a network of third-party innovation for small businesses that extends the value of Xero beyond what we build or own.

How do you think about the decision to build or partner with other software companies?

We always focus on solving our customers’ needs. Early on, we acknowledged that we couldn't build everything. That’s why we are passionate about facilitating an open platform, which fosters innovation and encourages the development of solutions that support small business. We build, acquire, and partner with our customers’ best interests in mind. We believe that choice benefits our customers. We’ll continue to foster an open platform that enables customers to choose the best solutions for their needs.

How has Stripe helped Xero?

We needed a way for our customers to get paid faster and streamline recurring payments. A few years ago, we announced a global partnership with Stripe to enable new payments experiences that are more seamless and efficient for small-business owners and their advisors. This partnership enables Xero users to accept credit and debit card payments, which helps business owners get paid faster.

Small businesses are fundamental to the growth of major and developing economies around the world, and ensuring that they get paid on time is vital to their survival and growth. With Stripe, Xero customers who accept Stripe payments on Xero online invoices get paid up to twice as fast as those who don’t use online invoice payments. We’re proud that together we can help small businesses spend less time chasing payments and more time focusing on doing what they love.

Where do you think Stripe and Xero are uniquely aligned in terms of customer focus and values?

Our partnership with Stripe allows both of our companies to focus on developing new innovations that help small businesses get paid faster, in more ways, and gain more visibility over their business performance. With cash-flow issues being front and centre for small businesses, we both recognise that businesses need better technology that can save them time and make them more efficient. We see a tremendous opportunity to champion this for small businesses.

In what ways can Stripe and Xero continue to partner effectively on behalf of small businesses that use our integrated tools?

Going back to my earlier point about cash flow, many business owners don’t have a good understanding of their current cash position or how much “buffer” they really have. It’s critical that small businesses maintain a healthy cash flow and grasp this because it can make all the difference to a business surviving. It’s clear that we can make a huge impact on small businesses with our payments experiences. We are excited to continue partnering with Stripe to explore new features and payments experiences so businesses can continue to scale their operations and run seamlessly.

Xero is a technology partner in the Stripe Partner Ecosystem. Learn more at https://stripe.com/partners/directory/xero-invoicing

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