Catching up with Xero: Tweetstorm edition
The Motley Fool Pro team caught up with XERO FP NZ (ASX:XRO) CEO Rod Drury, who is swinging through Australia for the company’s big Xerocon event later this week. Here’s a quick morsel-sized, Twitter-tastic take on the team’s latest thinking.
Great catch up with @RodDrury today. @Xero has so many futures and Rod has the focus and patience to bring them to life. 1/N
— Motley Fool Pro (@MotleyFoolProAU) August 11, 2015
$XRO has been punched in the nose since we first bought shares last year, but the business case keeps strengthening… 2/N — Motley Fool Pro (@MotleyFoolProAU) August 11, 2015
Subscription revenue grew 81% last year and $XRO‘s 87% retention rate is Foxtel-esque. Gaining share in all markets and… (3/N)
— Motley Fool Pro (@MotleyFoolProAU) August 11, 2015
Xero has rounded out the accounting product suite. Also expanding those markets, as many user-first disrupters do. 4/N — Motley Fool Pro (@MotleyFoolProAU) August 11, 2015
Gains will come in the US with time. Fixed the US leadership team and will have payroll in 50 US states by year end. It’s a slow burn. 5/N
— Motley Fool Pro (@MotleyFoolProAU) August 11, 2015
Speaking of burn, losses have risen, but for good reason. Customer acquisition costs booked immediately but value accrues over years. 6/N — Motley Fool Pro (@MotleyFoolProAU) August 11, 2015
We estimate the present value of $XRO’s incremental profit on a new customer is almost 3X the acquisition cost. 7/N pic.twitter.com/CL5qK5EAiY
— Motley Fool Pro (@MotleyFoolProAU) August 11, 2015
Very attractive economics on just the existing suite. New markets and products are eventualities, and will leverage strong, loyal base. 8/N — Motley Fool Pro (@MotleyFoolProAU) August 11, 2015
And plenty more room to run in the existing accounting channels (9/N). pic.twitter.com/V9UpXVmrKf
— Motley Fool Pro (@MotleyFoolProAU) August 11, 2015
Bottom Line: It’ll be a bumpy ride — comes with hyper-growth territory — but we’ve booked seats for the very long-haul. 10/N — Motley Fool Pro (@MotleyFoolProAU) August 11, 2015
Joe Magyer does not own shares of any companies mentioned this article. The Motley Fool owns shares of Xero. We have a disclosure policy.
Prior to launching Lakehouse, Joe served as the Portfolio Manager of Motley Fool Pro and the Director of Research at Motley Fool Australia. Before taking on leadership roles in Australia Joe, served as the lead advisor of US-based Motley Fool Inside Value, which was recognised by The Wall Street Journal, Hulbert Financial Digest, and MarketWatch for its outstanding returns.
Joe also writes a weekly column for the Australian Financial Review and makes regular appearances on the likes of CNBC and Sky Business. A CFA charter holder, Joe is also a graduate of the University of Georgia (BBA Finance) and Georgia State University (MS Finance).
You can see Joe’s personal holdings here.
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