Xro - xero

[Corporate]

Basic question, in the XRO presentation what does ACMR stand for?

[winner69]

Basic question, in the XRO presentation what does ACMR stand for?

Annualised Committed Monthly Revenue

Like what those signed up now will pay over the next 12 months

$130 odd million is pretty good eh

[Harvey Specter]

So Thiel&co are that dumb and unsavvy that they would poor millions into a company and buy shares at $18 when they are only worth $5??? Thiels net worth increased from 1.2 billion in 2012 to 2.2 billion in 2014 so like I said he must be pretty unsavvy aye, Hmmmm

whats really interesting with this is XRO is listed. Very unusual for Theil to still be investing once listed, let alone 3 times. Would love to ask him about it.

[couta1]

I never said that nor implied it, but nice try. I guess you have to start clutching at something when the wheels are falling off so rapidly.

But yes, in retrospect, I think that theil et al will be starting to really wonder whether this thing is actually going to work. We have new information now about lack of success in the states, which they didn't have at the time.

Not clutching at anything NG, i believe Thiel&co are in it for the long haul and are not that fickle to believe Xero would have cracked the states after a year, given there standing they will know what it means to ride out the tough times and will understand the culture in the States far better than any of us. If i didnt believe the story i would have sold out a while back or could any day i wanted to, its not as if im not used to taking a loss after my big CNU one and a few smaller ones as well along the way, only time will tell with this story

[Goldstein]

It's a good point. I'm assuming he, and the others, did some pretty hefty due diligence. And I reckon they're in for the long term (I wouldn't be too worried about those guys dumping shares over the next few months). And given they have skin in the game, I reckon people like Theil will be using their connections to push this thing along in the US especially.

Comments like the $5 one above, and the share price action over the past 12 months I think show that in NZ we have no idea how to value this sort of company. It has definitely been overvalued ($45) and I would say $5 is somewhat undervalued. I'm wondering if it has been oversold based on global fears and very reasonable concerns about the U.S. strategy. If you can get out of our quite small NZ mindset, a global SaaS company growing at 80% a year and that has executed largely to plan valued at US$2b could even be regarded as cheap (bearing in mind growth and potential far outweigh dividends and profit in terms of the market valuing this sort of business). Depends if you see the doubt as a risk or a buying opportunity... I'd still wait, personally, though looking at the volumes the last few days there is plenty of money piling in (it'd be great to see how much of that is from offshore- my guess, and I may be wrong, is that right now NZers are selling out of fear, and the shares are being snapped up by overseas interests).

What I'm suggesting with Inuit's SP is that the US market hasn't seen XRO as a serious threat this year. Depending on your view you might see XRO as a bargain at the moment.

It'll be interesting to see if the price stabilises around $18.

[Santiago]

Just wondering if anybody else on this thread watches dragon's den? Its one of my favourite TV shows. Provides very practical insights to how business risks and opportunities should be assessed.

The one thing that lets down most prospective companies on that shows is the absence of (i) IP protection, and (ii) barriers to entry. Xero faces both problems in spades. First, its code can be easily copied. Second, it cannot stop others entering the market. In fact, the situation is far worse. The market is already awash with other - much bigger - competitors.

I just can't understand why some of you can't see this or accept it??

Have you heard of "brand". They have a good one.

They're also the biggest and fastest growing at what they do (SaaS) in three of their four target markets, so I would say that their competitors have bigger barriers of entry than Xero, particularly because their brand is so strong.

I just can't understand why 80% a year growth isn't enough for you. Go ahead and do not buy the shares, stick to utilities or whatever it is you prefer, but give them some credit for growing from nothing to 371000 customers at a fast clip. Oops, that's probably 400000 now.

[Santiago]

Interview with Rod

http://www.nzherald.co.nz/business/n...ectid=11344259

Makes him sound like a nutter. Must be under stress...

[Casino]

You may be missing the fact that xero's recent SP action reflected a global overcooking of the market and was completely out of step with its underlying fundamental "value."

To put it slightly differently: $45 was bat**** insane. $17 is also ridiculous. Like. absurd. $5 looks like a worthy opportunity.

Cash per share is $1.35. $3.65 gives you an EV of $465 million. That's a revenue multiple of 3.6. Don't you think there is a happy middle between P/S ratios of 30 and 3 for a fast-growing company?

[Goldstein]

Just wondering if anybody else on this thread watches dragon's den? Its one of my favourite TV shows. Provides very practical insights to how business risks and opportunities should be assessed.

The one thing that lets down most prospective companies on that shows is the absence of (i) IP protection, and (ii) barriers to entry. Xero faces both problems in spades. First, its code can be easily copied. Second, it cannot stop others entering the market. In fact, the situation is far worse. The market is already awash with other - much bigger - competitors.

I just can't understand why some of you can't see this or accept it??

As far as IP goes, I'm not sure the code could be lifted. Regardless, they are simply doing what has been done before but in a modern way, using modern technology (data in the cloud available to many devices, etc)

As far as barriers to entry, Xero is trying to be best in breed. It has been written from the ground up with modern software engineering techniques. This should enable it to be flexible and easily modified/upgraded/tailored going forward. The other providers out there most likely have legacy code issues.

To my mind there isn't too much wrong with the product. It's the market penetration in the US that is the only concern to me.

[Casino]

As far as IP goes, I'm not sure the code could be lifted. Regardless, they are simply doing what has been done before but in a modern way, using modern technology (data in the cloud available to many devices, etc)

As far as barriers to entry, Xero is trying to be best in breed. It has been written from the ground up with modern software engineering techniques. This should enable it to be flexible and easily modified/upgraded/tailored going forward. The other providers out there most likely have legacy code issues.

To my mind there isn't too much wrong with the product. It's the market penetration in the US that is the only concern to me.

QuickBooks Online Vs. Myth #1: QuickBooks Online Uses “Legacy Code” (Busted!)

The belief that the current version of QuickBooks Online employs so-called legacy code, potentially a decade or more old owes much to a Forbes article from January of 2014. In that article, Gene Marks writes:
“Many current QuickBooks customers (perhaps you?) who are frustrated with the software’s older architecture but have suffered with it because they/you did not feel the need (or were just too lazy) to change will now be forced to change in the next few years.”
The weasel words here are “older architecture.” The truth is QuickBooks Online was redesigned in July of 2013, addressing the need for scalability and real-time data in modern, cloud-based accounting applications. The redesign that occurred in mid-2013 was from-the-ground-up – meaning no old code, no legacy cruft. Literally: none.
http://www.business2community.com/brandviews/getapp/quickbooks-online-vs-internet-rumor-mill-01007437