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Xero CEO Sukhinder Singh Cassidy
Xero

Xero CEO Sukhinder Singh Cassidy talks strategy, risk and pricing

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Sukhinder Singh Cassidy, CEO of Xero, tells AccountingWEB technology editor Tom Herbert why the cloud accounting platform has shifted to a more focused approach, how accounting firms can take more risks, and what doing the books for her family’s business taught her about the profession.

23rd Jun 2024
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In a wide-ranging interview conducted at the developer’s Xerocon 2024 conference, Xero CEO Sukhinder Singh Cassidy (above) discussed the company’s plans for the future, recent changes to Xero’s strategy, where she sees the artificial intelligence (AI) landscape going, and the success and failures in her career. You can listen to the full conversation by clicking on the podcast player below or searching for “AccountingWEB” on your podcast app of choice.

Singh Cassidy is somewhat of a Silicon Valley doyen, holding senior positions at Google and StubHub and co-founding successful start-ups Yodlee and theBoardlist, before joining Xero as CEO last year after Steve Vamos stepped down. 

She explained that Xero is honing in on three core areas: core accounting, payments and payroll, targeting its largest markets of Australia, the UK and the US. Last year, this shift led to the layoff of 700 employees, the divestment from finance platform Waddle and project management tool WorkflowMax, and the discontinuation of Xero Go. These moves are aimed at streamlining operations and ensuring resources are allocated to the most impactful areas.

“We were over-invested as a company, so we pared back in order to give ourselves room,” said Singh Cassidy. “The things we’re exiting are just trying to bring focus. Because if you think about those three jobs we talk about – core accounting, payments and payroll – they’re massive at Xero. We call them super jobs because inside of them there are so many other jobs [for example, core accounting might contain tax, analytics, pre-accounting and so on].

“If we don’t buckle down, and at least deliver the core, we risk losing focus,” she added. “And we already run a complex business.”

Addressing recent pricing changes to Xero, Singh Cassidy explained that Xero has simplified its pricing plans to bundle more value and streamline customer choices. While recognising customer frustrations, she emphasised the importance of aligning prices with the value provided, ensuring that users see tangible benefits from the adjustments.

“We announced a price increase on the current plans,” she said. “We always look to where we are situated relative to competitors, relative to the value we provide. We feel really good about the value we provide at Xero. Having said all of that, I understand that price is a trigger for people, and I think our job is to understand it, to feel like we are always being conscious of the value we provide relative to our prices.”

She also flagged artificial intelligence’s significant impact on Xero’s products, with machine learning powering optical character recognition (OCR) scanning, bank reconciliation and cashflow predictions. However, she feels that developing and integrating generative AI products, as demonstrated at Xerocon by Xero’s AI agent JAX, could enhance user interactions and simplify tasks, reflecting the broader trend towards conversational interfaces in technology.

Singh Cassidy also shared insights from her early experience with bookkeeping, ploughing through the books for her parents’ medical practice. For her, this hands-on experience, involving manual ledgers and late-night tax filings, underscored the transformative potential of technology such as Xero for small businesses.

Replies (5)

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By ireallyshouldknowthisbut
24th Jun 2024 19:16

I am afraid for most clients there is virtually no more 'value' than there was 10 years ago.

General inflation in the past 10 years is about 35%

Xero have more than doubled their fees in this period.

In the last four year alone its massive.

2020 to 2024 goes £10 to £16 starter, £24 to £33 Regular and £30 to £47 for premium.

I think 2014 was £9 / £17 / £22 ?? Or close to it.

All plus VAT of course!

Whilst existing users are going to be reluctant to move, and what Xero are banking on, its makes it almost impossible to recommend this product any more so they are going to be effectively signally "and now we keep on mugging you until you leave", ie the IRIS business model.

Its a shame to see them destroy thier goodwill in this manner. Its decent software.

Anyone remember Kashflow? Used to be the no.1 on the market.

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Replying to ireallyshouldknowthisbut:
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By DWordley29
27th Jun 2024 09:59

Have you seen the proposed rises from September 24? Some of the optional extras e.g. payroll, projects, expenses are no longer optional and only available on certain levels of plan. Many of our clients are looking at 20-40% increases in subscriptions because of this. As we include the subscriptions in the overall fee we charge our clients, we have either a big hit to our profits or months of difficult discussions with clients trying to renegotiate fees. The pricing and plans are becoming more and more of an issue yet basic functionality issues that have not reached the top of their to do list after many years are concerning. Starting to remind me of the way Sage took advantage of their position years ago and why everyone abandoned them for Xero once there was an alternative.

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By alfredpennypinch
25th Jun 2024 09:30

I'm afraid if you want to make any inroads into the UK payroll market you're going to have to up your game considerably.

Xero Payroll is absolutely dreadful AND absurdly expensive. My advice to anyone using the bookkeeping software (which is good) who needs anything other than straight bog standard payroll software with no complications at all for more than a few employees is to use something else. Anything else.

I used it for two horribly stressful months before reverting to Brightpay. It's been 4 years and I'm still scarred by the experience.

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Replying to alfredpennypinch:
By ireallyshouldknowthisbut
25th Jun 2024 10:44

I have looked at it a couple of times and its really bad software. I always stop clients using it. Payroll is complex, and you need a really sophisticated system.

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By indomitable
27th Jun 2024 17:08

"We feel really good about the value we provide at Xero. Having said all of that, I understand that price is a trigger for people, and I think our job is to understand it, to feel like we are always being conscious of the value we provide relative to our prices.”

I really don't think you do understand the value you provide relative to the price!!

Many of the modules e.g. payroll add NO VALUE and actually add cost by the time you've wasted your time evaluating them, same with expenses, workflow max, stat accounts production - list goes on.

Delusional in my view.

The bookkeeping software is good but is stops there!!

And Freeagent (also a very good product) is FREE if you have a Natwest account or around £15 monthly through a practice. Why would you pick Xero if you were starting out and had a choice?

Thanks (1)