This document discusses strategies for building a global platform and ecosystem. It emphasizes thinking big but staying focused. Key metrics for a financial and operating performance update are provided, showing subscriber growth and increases in annual recurring revenue, total lifetime value, operating revenue, and EBITDA. It is noted that this only touches the tip of the iceberg in terms of potential. The rest of the document provides advice on strategies for continued growth, including obsessing over talent acquisition, understanding what makes a company different, being open and helping others grow, focusing on key metrics, showing a clear path to profitability, embedding practices early, and maintaining focus on commerciality and profitability.
Building Global Platforms Through Focus and Collaboration
1. The Secrets to Building a Global Platform and
Ecosystem
Thinking BIG, but staying focussed
1
Damien Tampling
Global Chief Strategy Officer
Xero
@Xero
2. My last four years
Xero’s financial and operating performance highlights for the half year ended 30 September 2022
Subscribers
3.496m
+ 483,000 net subscriber
additions or 16% YOY
+ 225,000 net subscriber
additions in H1 FY23
APRU
$35.30
+ 13% YOY
(6% in constant currency)
AMRR
$1,480.8m
+ 31% YOY
(23% in constant currency)
Total lifetime value
$13.0b
+ 3.1b or 30% YOY
Operating revenue
$658.5m
+ 30% YOY
(27% in constant currency)
EBITDA
$108.6M
+ $10.5m YOY
Net loss
-$16.1m
- $10.2m YOY
Free cash flow
-$15.6m
+ $9.2m YOY
4. Obsess over who and how you bring on talent
1. Screening
a. CV Screen
b. Hiring manger review
c. Telephone review
2. Background & Case 1
a. CV Screen
b. CV deep dive
c. Case 1 – structured
problem solving
3. Case 2
a. Case 2a – Structured
problem solving
b. Case 2b – financial
acumen
4. Leadership review
a. EGM of other area/region
b. XLT member
0. ABILITY TO LIVE OUR XERO VALUES: #HUMAN, #TEAM, #CHALLENGE, #OW NERSHIP & #BEAUTIFUL
5. Understand what really
makes you different or better?
Profit Model Network Structure Process Product
Performance
Product
System
Service Channel Brand Customer
Engagement
Configuration Offering Experience
The way in
which you
make
money
Connection
s with
others to
create value
Alignment
of your
talent and
assets
Signature or
superior
methods for
doing your
work
Distinguishi
ng features
and
functionality
Compliment
ary products
and
services
Support and
enhanceme
nts that
surround
your
offerings
How your
offerings
are
delivered to
customers
and users
Representat
ion of your
offerings
and
business
Distinctive
interactions
you foster
Source: Deloitte, The ten types of innovation
3 is better than 1; 5 is better than 3
6. Be open and seek
ways to help others
grow on or
alongside you
Karma
What you put out will
come back to you in
unexpected ways. Give
only what you don’t mind
getting back to you
7. “All we have to decide is what to do with the
time that is given to us.”
Be focused and deliberate
9. Be able to show a clear
path to profitability
Now, more than ever
10. Good business and most certainly building
an ecosystem is about sharing ideas, value,
tools, with partners.
Embed your hiring practices early
Know what makes you different
Remain focussed, be deliberate - make it your
mantra
Find what metrics matter most and pour over them
Understand the commerciality of your investments
and maintain a line of site to profit - It’s not a 2023
thing, but good business practice
Takeaways
12. 7 Strategies for Optimizing
Growth with Profitability
12
Prashanth Prakash
Founding Partner
Accel
Hinweis der Redaktion
I’ve worked for Xero for the last four years – a global cloud accounting platform
Over the last four years we doubled subscriber and operating revenue, tripled annualized monthly recurring revenue; and more than quadrupled subscriber lifetime
Today - only touching the tip of the iceberg
Is so much we could talk about at a very tactical level, but for a room this size and with the time we have there too much of a risk of going to niche, so today my advice is more a set of observations, principles and ideas from my time as an entrepreneur, investor and executive
With more time, other topics could include: Sales incentives, hiring, product strategy, development practices, managing legacy code, building ecosystems, sales channels, rev ops, entering new geo markets, the key to great partnerships, what makes a good term sheet, pitfalls in due diligence, understanding how businesses are valued, budgeting and planning at 1m, 10m, 100m and 1bn+, the science and art of negotiating, managing dilution, setting up advisory boards, investor reporting, culture, OKRs, crisis management, Employee Share Plans / Incentive programs,
People pipelining, screening and nurturing
Would contest, your employees are more important than you customers – if you get the former right, they will take care of your customers
Doblin’s 10 types of innovation model
Reasons that innovation and/or a business can only be different in one of 10 ways and those that are multiples of these ways have shown to be some of the most successful in the World
Be open; share more
In Hinduism and Buddhism an action, seen as bringing upon oneself inevitable results, good or bad, either in this life or in a reincarnation
Also sometimes used as a word to describe the cosmic principle according to which each person is rewarded or punished in one incarnation according to that person's deeds in the previous incarnation.
So why is this relevant to starting and scaling a company, to SaaS, to this conference, to my presentation
In building a business, a good business, a sustainable business including an Ecosystem or other platform a focus on sharing and helping others is critical
I’ve found a different but very useful way to think about this is anchored in “what are you sharing” and a model a former mentor termed over 20 years ago – Karma business
Karma business is an idea grounded in “what comes around, goes around”; reciprocity
About being open and sharing
The model had four parts – Sharing, Refining, Proposing and Delivering – which leads to trust and more Sharing.
I truly believe this is an important concept at the core of the best organisations, companies, the best software and many modern day ecosystems.
So in your business and business model – how do you share value, share knowledge, share networks
Relevant to this conference because at its core I view it as about sharing – not promoting companies or products, but sharing knowledge and experience
Perhaps more focus could be achieved from drinking more coffee, prioritizing more sleep or setting clear goals ☺ but removing distractions is the single because driver and an area of I spent a lot of time on as a Founder, Investor, Chief Strategy Officer and dad – making choices about where you spend your time is critical, so to get others better than you in areas
As a founder or even a large company executive you can be:
Unfocussed – everything is a good idea or a possibility; leading to a clear case of spreading peanut butter (to lend a well trodden term) and most likely lacking deliberate
Focused, but not deliberate enough e.g. focused on half a dozen things, but some of them you are lead to without much thought or because it “pays the bills” or because saying no is hard or doing nothing feels uncomfortable. You see this a lot with products, customer types and even new market entries
Focused and deliberate – invest in a few things and concentrate their efforts; very deliberate about what they do and don’t do; where they’ll go and where they wont go; canreference what they say no to as much as what they say yes to
Understand your customers behavior from the process they go through to even consider your domain, you and your competitors, hopefully your product and then from there, their engagement with it.
Understand what you can control and what you cannot.
Obsess over the moments that matter in this journey and in particular be clear on the most important of these that you know are critical to influence early and measure as they are the best of the best lead indicators for further downstream results e.g. conversion, greater usage, cross selling, upselling, referrals etc
Don’t track everything equally