ITP Techblog

From zero to hero - the Xero story ramps up as Profit is Reached

It's taken nearly 11 years but Xero has turned a profit and the share price has bounded forward as a result.

Rod Drury's cloud-based accounting software service has been in operation since 2006 and went public in 2007 with a $15 million IPO.

Today the company's market cap is $3.17 billion and the company has one million customers as of March this year, including this writer.

The secret to Xero's success lies in the automation of so many tedious chores that previously cost business owners time and money to complete. By tackling the pain points of accounting head on, and by automating some of the more tedious chores like invoicing and receipt management, Xero offered the market something its competitors (particularly Quicken and MYOB) simply could not match and at a price point far below any of the server-based offerings.

It's not been all plain sailing for the Wellington-based company. Senior leaders have departed with regularity, especially those in the US operation, and the company has struggled to take on new markets, but the customer base continues to grow and the revenue is now at least being matched by actual profit as well, albeit a scant $9 million for the six months ended in March, on the back of $294.4 million in revenue.

Rod Drury has long been the poster child for New Zealand start-up companies - Xero is not his first time at the rodeo as they say - and he's determined to build a "billion dollar business from the bach". Finally it seems that dream is starting to pay off.

NBR - Xero shares rise as it breaks even earlier than expected

Stuff - Xero moves closer to break even as annual sales approach $300m

Xero - Thanks a million

 

End! Of! An! Error! For! Yahoo!

And so farewell Yahoo! Of the exclamation mark! You were here, you were everywhere, you were nothing but a fading memory.

After years of poor service, outages and even security breaches, Spark has finally had enough and taken control of its Xtra email service back off American dot com giant Yahoo! and given it to local provider SNX.

The story of Xtra is one that goes back many years to Telecom's first foray into this shiny new world called "internet".  At a time when the company had only just realised customers wanted to connect to the rest of the world ("We do offer fax machines, you know" is an actual quote) it created a standalone business called Xtra just in case the whole thing went pearshaped and needed to be ditched ("Boss, they've stopped looking at cat videos. What do we do?" "I knew this day would come. Prepare to deploy Operation Home Line Renewal!").

Eventually however the inevitable march of the internet caught up even with Telecom and the company realised it had created something of a monster with its Xtra email accounts - originally a great selling point (You get internet access AND an email address for the low low fee of only one beeeeelion dollars) it had become something of a cost burden on the company and so Telecom farmed the whole thing out to that renowned provider of email access, Google.

No, sorry, that's not what happened. Instead of Google (motto: We Make Email Easy), the company chose Yahoo! in a move that confused commentators and punters alike and didn't get any better as time went by.

After outages in which Yahoo! claimed no responsibility for any problem oh wait you are affected, after security breaches that required a hard reset of all passwords and after years of shoddy and shabby treatment, Spark finally made the call to bring New Zealand's email service back home.

And so as of yesterday the final migration of email addresses was complete and Yahoo's dominance of the market was but a memory, and just in time for the merger with Verizon which takes place next month.

Yahoo! may once have been a power house in the crazy world of the internet but for at least one user it will always be that place that couldn't even run an email service properly.

NZ Herald - Spark completes divorce from Yahoo

Techblog - End of an error for once great Dot Com giant in New Zealand

 

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The Future's so Bright

Many years ago I read Snow Crash, a novel of the near future written by Neal Stephenson.

Yesterday I forgot to take my copy so he could sign it for me when I heard him speak at the BizDojo in Auckland as part of the Techweek '17 programme.

Snow Crash really resonated for me for a number of reasons. The hero (the jauntily named Hiro Protagonist) lived in a post collapse USA that very much resembles the country that Donald seems intent on creating, lived his life on the internet but spent his time in the real world as a pizza delivery driver and as a former driver myself (for a company that needs no publicity and for which we shall use the pseudonym Pizza Shack) I felt a certain resonance.

Plus Neal was the coolest writer around, with lines I could and did readily incorporate into my regular every day speech.

It was also the first time I came across a science fiction writer who was writing about the near world, rather than the impossible. No faster than light spaceships, Stephenson writes about coders, cryptography, digital currency and nanotechnology. It was all plausible and entirely believable.

I got to ask Neal whether he thought the race to space was over or whether we'd ever pull our puny species out of the gravity well and do better than the dinosaurs (something I've been thinking about with a significant portion of my brain ever since reading his latest book, Seveneves, which is about the end of the world and what happens after) and he was practically upbeat about the chances. Instead of living in "The Gap" between space missions (my words) he felt we were moving to a model where private money would propel us to the next stage and that while the Apollo missions were tremendous, they were very much ahead of their time. Landing a rocket on its tail on a barge in the sea is no mean feat, he said, and that we're doing that now should not be underestimated.

I for one hope he's right on the money.

Stuff - Author Neal Stephenson is shaping our 'virtual' futures

Bill Gates - The Day the Moon Blew Up (yes, this is a book review by Microsoft's Bill Gates)

RNZ - Neal Stephenson - Postcyberpunk author and futurist

NZ Herald - Prime Minister Bill English sees the future