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Next generation banking a reality

Over the past year or so we’ve been working on our vision for next generation banking. We’ve spoken about this a number of times before – but now, thanks to our friends at ASB and TSB Bank, it’s a reality.

Accounting software and internet banking should be complementary. Think about it – at its heart, Xero accounting software is about financial awareness, insight, and decision-making. Internet banking is about taking financial action and managing your money. It makes sense that the two go hand-in-hand.

With customer consent, data could flow between the two worlds – making each product that much more useful. Transactional data comes into Xero from the bank, where it’s processed and reconciled. If a customer wishes, financial data could be passed back to the bank for a variety of services: for payments; for a loan application; or for sign-up to additional services.

The video shows some of the outcomes of our next generation banking work, illustrated through our integration with ASB. Data can be sent to Xero quickly and easily and payment instructions can be pushed back to the bank for authorisation. In the old world you would manually download data and upload into Xero, or at best, complete a paper application form and send to us for processing. With this approach, your feeds are set up instantly and securely. Similarly, there’s no batch payment files to be downloaded and uploaded into internet banking – they’re sent through frictionlessly.

Watch Steve Jurkovich from ASB talking at Xerocon Auckland 2014 about how the cloud is changing banking and how ASB is embracing new opportunities through its work with Xero.

Banks are conservative organisations, and so they should be – after all, they’re handling your money. But a great deal of innovation for banks comes through collaboration. It would be very difficult for any bank to meet all the needs of its diverse population of customers with the vast plurality of products that would be required. They can’t possibly replicate all the Mints, the Billguards, the SigFigs, the Bill.coms, the Expensifys, the Dwollas, and the hundreds of other services out there that have blossomed throughout the fintech ecosystem  that people have come to rely on. Safe and secure collaboration with established partners like Xero acts as a multiplier or an accelerator to a bank’s desirability to its customers.

Watch out for more banks introducing support for next generation banking soon. Or maybe consider switching to one that already does. The future is bright for those that have.

UPDATE:  If you’re a FastNet Business customer who’s already set up feeds by sending in a paper form, you can still activate direct payment link.  Find the Accounting Setup section in FastNet Business under Administration > Client, and select ‘Automatically Import Payments’ against the accounts you want to make payments from. Follow the process to connect up the feeds, and the next time you create a batch payment file, it will automatically be sent to FastNet Business. Easy.

What people are saying about next generation banking

And it works. Here’s what people are saying about this new generation of banking:

 

Keeping our people happy – shrugging off my HR shoulder pads

Anne Allen, UK HR Manager, tells us all about her goal of keeping our people happy, engaged and motivated:

As Xero UK’s HR Manager, part of my role is making sure each and every one of us is happy, engaged and loving the job – quite a tall order, as you’d imagine! But in our recent Xero employee survey 92.2% of the UK team said they feel a great sense of commitment to Xero UK. And 90.6% said they’re committed to going the extra mile. That’s an impressively high engagement level, which is great news for the future of the business.

UK Xero team at MK Expo

UK Xero team at MK Expo (Anne second from right)

We’ve grown rapidly over the past year and the power of fresh, enthusiastic recruits and the energising force of newly employed people has definitely charged the Xero batteries and we’re raring to go!  My job will be to help maintain this amazing level of motivation in the team as we continue to expand and take on more and more talented people.

Continue reading ›

 

University of Oxford Silicon Valley Trek

Guest post by Karl Loo, MBA Candidate 2014, Saïd Business School, University of Oxford

Silicon Valley Trek for Saïd's Business students

As a New Zealander, it was a proud moment to lead my classmates from Oxford University to visit Xero – a leading Kiwi business – in San Francisco.

This year, our trek list included the likes of Google, Facebook, Square, IDEO, Y-combinator and Xero. Although Xero is a new arrival to the Silicon Valley scene, I have been watching Xero and its phenomenal growth in New Zealand. Now the company is one of the largest companies in New Zealand and is on track to dominate the accounting software segment globally – and it was great to see them in their new offices in the homeland of IT innovation.

Xero was one of the stops on the Silicon Valley Trek

From an MBA student perspective, hearing from the executive leadership team was thought provoking. Highlights included learning about the agile product development methods as well as the unique challenges of marketing a traditionally unglamorous sector, accounting. The class was impressed that a provider of accounting solutions could have a focus on beautiful design, as well as the sheer pace of growth of the company – “everything doubles each year” was a phrase that struck us.

 

San Francisco Xero product hackathon

At Xero, we’re so committed to innovation that we host a product hackathon every quarter for our San Francisco product teams. These allow ideas from our team to get the chance to move from an idea to working prototypes.

We hold two types of hackathon events in our San Francisco office. Our HackIt events last a few days and are focused on innovative ideas with few rules attached. Our ShipIt events give the team the chance to work on something that they want to improve but it must be delivered, ready for release, after two days. It’s understood that there’s no obligation on Xero to ship any of the projects. However, it’s a way of generating ideas that we can use for planning future work on the products.

Hackathon payroll product team

San Francisco Xero Product team

The winners of our hackathon last week in San Francisco was the Xero Achievers. They worked on the gamification of payroll using badges and Facebook integration. We also had teams working a new tax engine, automated timesheet check in/out using a mobile app, a new architecture framework, a goal tracking app, a conversion tool, hotkey navigations, and an on-screen calculator. It was a great few days, with lots of passion, collaboration, discussions and of course nerf gun battles.

HackIt Hackathon Winners

Xero Achievers Hackathon Winners

What is a hackathon?

hackathon is where there is free rein to work on projects the team think will be useful, innovative or cool. Our events kick off with a traditional hot American breakfast to keep the energy levels high for the day. Then, the fun begins.

Regularly scheduled work takes a back seat while the team build, code and hack away on something that interests them – whether it’s an issue they want to solve, a process they’d love to improve, or something completely random they want to try. They’re encouraged to think outside of the box and they have the chance to collaborate with other team members they may not normally work with.

There’s a few key reasons why we do these events:

  • Thinking out of the box – gives an opportunity for those radical ideas that would never be prioritized.

  • Fostering innovation – If there are no constraints then anything is possible.

  • Enjoying work – Culture is a huge part of working here and these hackathons help to make Xero a great, fun, place to work.

These hackathons embody our company culture of creativity, challenging the norm and having fun whilst we do it. Giving our teams the freedom to work on whatever they want for a couple of days keeps them on their toes and challenges them, both creatively and technically. We believe that being surrounded by innovative ideas helps develop new ones, and pushes us to think outside the box.

Already started thinking about a project you’d work on? If you think you might be a good fit for the Xero team, head on over to our careers page to apply for an open position!

 

Xero unaffected by OpenSSL issue

A security flaw has been discovered in the popular OpenSSL cryptographic software library that is used by up to two thirds of the internet, as well as by a small number of services that Xero uses. Xero has in no way been affected, and your data is safe. More information is available at the OpenSSL page which includes the Security Advisory.

The researchers who discovered this issue have given it the dramatic name of “Heartbleed”, which you may also see referenced in some news articles.

Steps Xero has taken

Any time there is a potential threat to Xero, we conduct a Security Incident process which includes investigating the potential impact to Xero and our customers.

  • The immediate step we took was to evaluate which Xero systems use OpenSSL, and whether they used the affected version. The majority of our environment does not use OpenSSL as we run predominantly Microsoft technologies. The sweep of our environment showed no servers or sites running the affected versions.

  • The second step was to evaluate which external systems we, or direct customers, use that may be vulnerable. The only vulnerable site identified was our Australian Partner ‘Toolkit’, which stores no customer data and does not allow users to log in. Our third-party hoster for that environment is August, and they admirably patched the issue within 30 minutes, for which we thank them. The Xero Toolkit site is no longer vulnerable.

As stated above, we have no reason to believe that any of Xero’s environment is affected by this OpenSSL issue. We count ourselves lucky in this case, as a lot of other SaaS providers haven’t been as fortunate.

What you can do

Even though your Xero account is not affected, it is good practice to regularly change your passwords that you use online, and to use a different password for each site that you use.

To protect you from other sites that you use being compromised, consider changing all your passwords for important services now, while it’s at the front of your mind.

To manage multiple passwords for different websites, so that you don’t have to remember them all, we recommend the use of a password manager such as KeePass.

What we will do next

While we don’t have any immediate actions needed to protect our users, we are looking at whether there are any further steps we can take to add additional protection. I’ll update this post later with any action we take as an outcome of this threat.

If you have any questions, please do not hesitate to contact me (Security Officer, Xero) via our support channel (support@xero.com).

 

 

January self-assessment for accountants: process, systems and cloud benefits

The start of the year is a busy time for UK accountancy practices. The deadline for self-assessment means that January can be a pretty hectic month, and when you’re busy it really focuses attention on how efficient (or otherwise) your processes and systems are.

With this in mind, we got together with AccountingWEB to ask a sample of 1,100 accountants how the 2014 self-assessment period was for them this year.

UK accountants' self-assessment infographic

Continue reading ›

 

US Payroll in Xero: Texas and taxes

As a follow up to our US Payroll update in March, we’re excited to provide an update on the last few US Payroll releases.

US Payroll in the Lone Star State

US Payroll in Xero now supports tax calculations for Texas work and employee locations. We had a lot of demand to bring payroll to Texas — after all, it is the state with the second-largest population — and we’re pleased to make this happen for small businesses that reside there.

US Payroll settings in Xero
Continue reading ›

 

A great finish to FY14

We feel very proud to report on FY14. 

Please let me know if you have any questions.

MARKET RELEASE

Xero finishes year up 83% to $70m

4 April 2014

(Note: all currency is in New Zealand dollars and results are unaudited)

Xero Limited (XRO) announces operating revenue of $70.1m for the year ended 31 March 2014, up 83% from last year’s $38.4m result.

With monthly committed subscriptions growing to $7.8m, the recurring revenue model means that Xero commences its 2015 financial year strongly with $93m in annualised subscriptions (representing an 81% increase on the $51.5m reported at the same time last year).

The net loss after tax for the second half of the year ending 31 March 2014 is anticipated to be similar to that reported for the first half resulting in a full year loss of approximately $35m, compared to $14.4m last year. Xero has expanded its team to 758 employees and has $210m of cash to fund its growth.

Xero up 83 percent to $70m in FY14

The strong New Zealand dollar adversely impacts reported operating revenue given 66% of this revenue is denominated in foreign currencies. On a constant currency basis Xero grew operating revenue by 92% in the period.

FY14 commentary

Recruiting senior management for growth and filling out global teams was  a key focus for the 2014 financial year as Xero added a further 376 employees.

Xero is now the leading accounting software provider in New Zealand and the leading online accounting software in Australia and the United Kingdom, with annualised subscriptions of $29m, $41m and  $14m respectively.

With strong growth expected to continue in these markets, Xero turns its focus on the important US market. The US market entry phase was completed successfully, allowing Xero to raise an additional $180m of capital in October 2013, bolstering the Board with appointments of New York-based Chris Liddell as Chairman and San Francisco-based Director Bill Veghte and appointing Peter Karpas as CEO North America.

Xero has been receiving US industry recognition, including: Accounting Today’s 2013 Top New Products: Honorable Mention – Xero Touch, Mobile category; CPA Practice Advisor’s 5-Star review 2013 (for Software as a Service); and “Top Choice” for the best online business accounting app by PC World/ Macworld.

Xero has also made progress on a number of large scale partnerships, and has recently announced integration with Square, Inc. in the US.

Regional breakdown

Xero regional breakdown for FY14

Xero has proven its strategy and execution and continues to build a world-class team, while substantially growing revenue.

Progress against the incumbents and its strong cash position places Xero at the forefront, as the adoption of cloud software accelerates for small business solutions.

Xero expects strong growth to continue for the foreseeable future.

END 

 

Mr. Sleeter’s Neighborhood – Interview

In case you missed it, check out US accounting industry leader Doug Sleeter’s webisode, featuring our very own Rod Drury.

 

Strategic alliance with KPMG in the UK

In London this morning we’re announcing the launch of a strategic deal with KPMG, one of the Big 4 global accounting firms.

This is a significant milestone for the adoption of cloud accounting in the UK and one we expect will further accelerate our growth in the UK, the most hotly contested online accounting market globally.

KPMG London