Xero has over 800 app partners, and some are truly setting new standards for innovation and customer satisfaction. Near the top of that list is Practice Ignition, as its five-star reviews attest. If you were one of the 900 people who attended Practice Ignitions pre-Xerocon party in Brisbane recently, you would have felt the energy and enthusiasm of the team.
We weren’t the only ones who have noticed this rising star. As reported in The Australian, Practice Ignition just received a whopping A$26 million in Series B funding, led by U.S. hedge fund Tiger Global Management. If you’re not familiar with Tiger, it has backed tech successes including Spotify, Stripe, Flipcart and Ola. It’s said to have built more unicorns, or startups with $1 billion valuation, than any other fund.
It’s easy to see what attracted Tiger. More than 2,500 accounting and bookkeeping firms in Australia and across the globe already use Practice Ignition to manage 125,000 engagements every month. But that’s just 0.2% of the total addressable market, which means there’s huge upside. And most of Practice Ignition’s revenue now comes from outside Australia.
Practice Ignition’s value lies in automation. It lets an accountant or bookkeeper draft a service proposal in minutes, select work modules from a firm’s offerings, then send the proposal to the customer for online signature. The software also collects the customer’s payment details for future billing and connects to a practice’s workflow, invoicing and payments systems.
This last step is key. It ends the need to chase payments with every billing cycle. The typical accounting firm moves from having 30% of its annual revenue in accounts receivable to $0 as its adopt and rolls out Practice Ignition. As Xero Small Business Insights data has shown, the relationship between timely payments and cash flow is a critical one.
Practice Ignition’s seamless integration with Xero – including single sign-on – makes it especially loved by accountants and bookkeepers.
“We built our original go-to-market strategy around Xero,” says cofounder Guy Pearson. “Our minimum viable product had to work with Xero and Xero Practice Manager. As we’ve built the business, we’ve created a more robust partnership, including winning Xero App of the Year.”
So what are Practice Ignition’s plans now that it has A$26 million to work with?
“It’s time to hit the accelerator on hiring,” says Pearson. “We now have cash in the bank to bulk up our teams. You’ll see streams of new innovation in coming months and years.
Pearson plans to triple the size of his global team, which is now at 60 ,to almost 200 people by the end of next year in Canada, the U.S., Australia and the U.K. The current team includes includes alumni from Xero, Deputy, Spotlight and other successful apps from across the ecosystem.
Practice Ignition’s success offers a model for other up-and-coming app partners in the Xero ecosystem. Apps that solve problems for accountants, bookkeepers and small businesses have with Xero a global platform from which to launch their success. Those apps that integrate most deeply are likeliest to create frictionless experiences, and in turn build customer advocacy.
“We’re building a transformational company that changes the fabric of how services companies can run their business,” says Pearson. ““It feels like the end of the beginning, and it’s super exciting.”