Startup Finance: Xero Powers Accounting in the Cloud
This post is part of our ReadWriteStart channel, which is a resource and guide for first-time entrepreneurs and startups. The channel is sponsored by Microsoft BizSpark. To sign up for BizSpark, click here.
When New Zealand-based entrepreneur Rod Drury began researching his market he could hardly believe what he was seeing. As seen in Drury's comments last week on the state of the online finance ecosystem, only a handful of players like Saasu and MYOB were targeting small business clients. While Drury saw that a number of cloud-based personal finance companies like Mint were gaining traction with users, small businesses had been stuck with the same tired desktop accounting software they'd been using for the last ten years. Drury built Xero with the intent to help small businesses manage their accounts in the cloud.
When asked why the cloud is so important for accounting services he explains, "In the past small businesses rarely shared their business data with accountants as the majority of billable hours were spent simply extracting the right information." Says Drury, "The fact that your entire business can now look at your accounts in the cloud means that the accountant can finally act as a business advisor and improve your cash flow."
Xero also works with a number of banking institutions. This means that rather than waiting 5 business days for a bank to reconcile your accounts, they're up-to-date with your daily transactions.
There are currently 12,000 companies working with Xero (including ReadWriteWeb) and the company recently launched integration with invoicing service FreshBooks and CRM-tool Salesforce. For between $19-39 dollars per month startups can access their accounts from anywhere and reduce the anxiety around the accounts payable and receivable process. To try it for yourself visit xero.com.
Editor's note: This story is part of ReadWriteWeb's Online Finance series, a weekly, three-month long look at how the Internet has transformed finance. Up until April 15, the deadline for U.S. readers to file their taxes, we'll be looking at how finance software has evolved, analyzing top web tools and posting video of our conversations with the people who are shaping online finance. If you are interested in sponsoring the rest of this Content Series, please contact our COO Sean Ammirati.
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I'm a big fan of Xero!
I also use another great web tool http://www.streetfolio.com.
I use Streetfolio to manage my real estate finances (mortgage, rent and property expenses).
Both Xero and streetfolio are cloud based and simple to use!
The excellent British-based (with coverage of all the relevant UK taxes, whether you're a sole trader, partnership or limited company with employees etc.) alternative to Xero is FreeAgent - sign up for a free trial then get 10% off if you subscribe here: http://www.freeagentcentral.com/?referrer=2jo837qt
Definitely check out MinuteDock if you like Xero - it's a slick time tracker that plugs right into Xero. It automagically creates invoices based on your time entries, and lays them out in a coherent way that won't leave your customers asking questions! http://minutedock.com
This is a good idea for start-up business.
The people at XERO have created their Network API that allows partners to integrate smoothly without any problems. It basically requires a simple line of code to transfer to and from XERO. Out of all my experience in integration with outside applications, XERO is one of my favourites!
12,000 companies with Xero as of Sep 31st 2009. 15,000 today!
When we're talking business accounting and doing it online...QuickBooks has a stellar app. (Quickbooks online)
To your point in the article, managing that multi user access and sharing the right information is critical. QuickBooks Online makes it effortless to connect with other users...setting someone up to share your books real time or to access time tracking is as easy as e-mailing them an invitation. Away with the complicated set up or IT specialist.
Kristen Berman
QuickBooks Online Product Manager
Kristen - correct me if I'm wrong but isn't Quicken Online is being phased out? Not so steller perhaps?
http://www.businessweek.com/technology/content/jan2010/tc2010018_451437.htm
"Four months after Intuit (INTU) bought personal finance Web site Mint.com, the company is preparing to phase out its Quicken Online software, moving Intuit's Web users to Mint."
Is it not irresponsible for Quicken to be generating this product at it is being phased out?
I use saasu.com for a fair few businesses now, as a business owner and angel investor it makes it very easy since it is all online and I can switch between businesses easily and you don't have to pay a ridiculous amount to get all the real features like payroll/salaries and inventory plus all the usual stuff like multi-currency and cool sales analysis reports. Cheers, Pete.
Oh, I forgot to mention, saasu integrates with heaps of banks, has had salesforce integration for years plus timesheets inside and via integrated partners like 88miles. There are also point of sale integrations like touch cashier and content management systems integrations, payment systems and hundreds of partners. - Pete.
@peter and Daniel...Quicken Online is being phased out, you are correct. Quicken focuses on helping manage personal finance.
I was/am referring to QuickBooks Online. QuickBooks Online is Intuit's web accounting product for small businesses. We're not phasing out this at all! In fact, we're completely energized around helping solve small business accounting with a QuickBooks online solution. LMK if you have questions on this. Thanks for seeking the clarification.
Xero is a great offering if QuickBooks does not meet your needs. That is why our CPA firm is one of the first in the US to deploy, install and support Xero.
Kristen is right in that QuickBooks Online is a great tool as well, but many clients of our CPA firm are uncomfortable with QB Online as it is so different than the QuickBooks desktop version.
But our firm now hosts QB desktop version for our clients so that they still have the freedom of SaaS and the flexibity of paying for their software monthly. Works on the Mac too.
Whether we are implementing Xero or QB in a remote hosted environment, we are pushing our clients online and watching them enjoy the freedom of online accounting.
Great post!
Jason M. Blumer