Posted by Doug Morris on September 1, 2014
It’s been a week since Xerocon. Since then we’ve been busy admiring our award for Add-On of the Year and following up terrific leads from accountants and financial advisers. For us, Xerocon still serves as an excellent brand awareness event; a chance to introduce people to what we do and how we do it.
For the existing clients who visited our booth, thanks for dropping by! The most common thing we heard was “I have a few client portfolios on Sharesight, but I need to add more.” That’s great to hear – don’t forget we offer portfolio setup and training for free. All done in-house by the same people you met at the event.
This was our fifth Xerocon, the largest to date. Over 1,300 attendees and 80 exhibitors. The theme of each has evolved. Once upon a time the discussion was all about cloud; amazement at how it worked, skepticism about how on earth it could succeed. Now the conversation has shifted to fundamentally changing the way business works.
Rod Drury and co. have a proclivity for speaking about their global ambitions in strokes broad enough to match. One thing he’s instilled in all “Xeros” is positivity with a noticeable lack of excuses. Besides a few Kiwi jokes here and there, you never hear Rod mention geographical, technological, or financial barriers to expanding the Xero ecosystem worldwide. We love this approach. We had an opportunity to spend some time with Rod earlier in the week at a small event and his enthusiasm was identical to that on stage in front of thousands of people.
Xero’s continued support of their professional partners is impressive. On a global scale, Xero isn’t that big (less than 1,000 employees), but their business model is ingeniously profuse. By providing digital marketing and general cloud umph to the accounting firms and (now) financial advisers using their product, those partners in turn evangelise the product to their client bases.
We mentioned via Instagram that Xero serves all types of business, from “sheep to shares.” This isn’t marketing bullshit, it’s real. This creates an engaged community of Xero enablers. At this point it seems that Xero is truly determined to changing global business, and oh by the way they’re doing it via an accounting application. This is clever. Accounting (and payroll) touches all businesses.
Xero is taking real steps to becoming a big time financial services platform. For Xero, this will initially involve tighter bank integration and better connectivity with tax and business registration offices. At Sharesight we’ve noticed that fintech firms have already worked out that instead of competing or partnering with slow-moving banks, it’s more effective circumventing them altogether. What if one day Xero has its own PayPal type payments system?
Several Xero speakers mentioned expansion, both horizontally and vertically. The Add-Ons have a lot to do with this strategy and it was good to hear Xero reconfirm this. Sharesight represents a horizontal expansion in that we can introduce Xero to parts of the market who might not have otherwise considered their product. Other Add-Ons (or core Xero functionality) enable vertical expansion. Float is an example of vertical expansion. Xero was quick to point out that their plan is not to buy supplemental services, but to partner with them as opposed to say Intuit.
The Xero product team is taking a concerted look backward (in a good way). Now that Xero is so widely used in Australia, Xero can analyse some of their truly big data. According to one stat, Xero has singlehandedly decreased accounts receivable time nationally from 42 to 31 days. Expect more insights in this regard – not just to gain headlines either – they announced more functionality inside individual Xero accounts in terms of analysing client behaviour, complete with charts and reports. With this will come some welcome UI improvements to Xero too.
A noticeably absent topic was investing. Yeah, we’re biased. Xero has only just begun wading into the financial advice space and of course we’re doing our part to bring Xero to the investing community. To date their concentration has been on introducing financial advisers to their budgeting tools and national practices to the benefits of partner edition.
These are good first steps. But if Xero wants to get noticed inside a dealer group, investing and insurance will need to play more prominent roles. FOFA, mFunds, and the evaporation of commissions could prove to be a boon for Xero – more financial advisers will need to prove that they’re adding value. Australian financial adviser software focuses on product distribution and commission tracking. Xero and their app ecosystem would bring a long-needed change to this by empowering the end client: the investor.
All up, it was an excellent event. We estimated that we met over 300 accountants and financial advisers – well worth the price to exhibit. Of, course being named one of the best Add-Ons means a lot of follow-up interest! Kudos to all Xero employees, especially the event staff. The event is growing so large, with expectations to match. Next year it might be difficult to retain a cohesive feel and raise the bar even higher, but Xero is up to the task.