Hosted Xero accounting system opens for business in UK | AccountingWEB

Hosted Xero accounting system opens for business in UK

It's another week, and another web hosted accounting software system has hit the UK, this time from New Zealand-listed start-up Xero, which is promising to unleash a life-changing "purple cow" that will introduce small businesses to technology's next evolutionary phase.

The £29 a month Xero system is the brainchild of technology entrepreneur Rod Drury, who worked with Wellington-based accountancy firm Openside to create a "disruptive" Web-powered accounting system.


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still not proven as disruptive ....

Anonymous | | Permalink

You may be right about being illogical but nothing in your posting backs up this statement. The problem with leaving much unsaid is that the audience remains in the dark

Business models - chargeable ones are not new and the 'free to air' approach (advertising revenue) is becoming more accepted; not revolutionary

'..600 year old methodology..' - some of us began addressing the Software Service concepts back in 2000 & earlier; way before others joined the show

I would challenge your 'green field' statement. Surely both suppliers are operating on a 'brown field' basis because they are delivering a flavour of a mainstream product on a well defined existing platform using tried & tested delivery methods. On the basis of Christensen's work, this is a natural progression (sustaining) and cannot be classed as 'disruptive'

To analyse each part:

  • accounts packages are mainstream & have been for many years - a different 'look & feel' has been adopted by many over the years but underlying concepts have not changed
  • As for 'look & feel' - Intuit introduced an alternative non accountant user friendly approach many years ago on the desktop
  • the concept of SaaS may have been 'disruptive' at one time, but that was 7-10 years ago and one can tell how mature it is by the fact that M$ has currently woken up to it
  • '..our signups tell a different story..' - the whole point about 'Disruptive Technology' is that it is so far off track (advanced?) that it simply doesn't attract this sort of uptake because it is outside the comfort zone of many
  • By definition two similar products cannot make the same claim - to be classed as disruptive in the same area they must be mutually exclusive. For example are they as ground breaking as the GUI conceived at Rank Xerox which evolved into Windows - this was truly disruptive?

    I am sure that both products are probably very good but quite frankly after taking the above into consideration they don't stack up as being disruptive

    dahowlett's picture

    Drunk in frist class?

    dahowlett | | Permalink

    @jc - you love to stir the pot but on this occasion you're way off base with a wholly illogical argument. Fact of the matter is that new business models are being created that are disrupting the status quo. You may not see it but I do about which I'll be giving explicit examples in a future post on AW.

    You may see 'self sustaining' but I see green fields. We're obviously not looking in the same place but that's OK. While much of the profession continues navel gazing at a 600 year old methodology, companies like Xero and others will be busy quietly eating their lunch.

    As to FreeAgent: our signups tell a different story. I'd invite you to check this out to see what people who use this stuff think. At the end of the day, it doesn't matter what I say, it's what customers say that really counts.

    Refer 'The Innovator's Dilemma' ....

    Anonymous | | Permalink


    In the context used

    '.. technology entrepreneur Rod Drury ... to create a "disruptive" Web-powered accounting system ..'

    indicates that 'disruptive technology' is being referred as defined in 1997 by Clayton Christensen in 'The Innovator's Dilemma'

    The following links expand

    Wikipedia: Disruptive_technology

    What is?: Disruptive technology

    Innovator's Dilemma by Clayton M Christensen, extract covering "disruptive technologies versus rational investments".

    To summarise

  • Sustaining technology relies on incremental improvements to an already established technology
  • Disruptive technology lacks refinement, often has performance problems because it is new, appeals to a limited audience, and may not yet have a proven practical application
  • Not more 'disruptive' claims ....

    Anonymous | | Permalink

    Yet another accounts system labelling itself as 'Disruptive'

    '.. create a "disruptive" Web-powered accounting system ..'

    Here is another:
    Opinion: Tales from the IT Edge by Dennis Howlett about his involvement with FreeAgent Central.

    Neither of these can really lay claim to this status - they are just an updated approach to a well trodden path (i.e. 'sustaining'). New they may be - disruptive they are not

    Anyway by definition they cannot both be 'disruptive' !

    Disruptive = Change

    Hamishxero | | Permalink

    Disruptive means (according to the Cambridge Dictionary online) causing trouble and therefore stopping something from continuing as usual, and that is exactly what Xero (and FreeAgentCentral who you also reference) are doing for small businesses and freelancers respectively. They are saying you don’t have to ‘do’ your accounts like an accountant, but you can instead manage your business finances in a way that suits how you work. That is stopping things ‘continuing as usual’.

    So if both solutions are causing trouble (to the existing approach of doing accounts for small businesses – such as using PC-based solutions) then by definition they can both be disruptive.

    We’re not ‘sustaining’ anything as users are ditching PC based solutions that are designed for ‘accounting’ and switching to our online system that focuses on ‘business information’.

    I like the debate, it is very helpful for all of us.


    Co-founder of Xero