Xero Live is an online Web 2.0 accounting software as as service company. What makes their listing on the NZAX public market quite so remarkable is that the product is barely out of beta, and is only available as a limited public release to New Zealand companies. They obviously plan to take on offshore markets, with the UK and Australia being top of their list, however, at the moment their revenues are negligible, like $4 grand per month. The offer was fully subscribed, but they had hoped they would get up to $18 million. Founders and strategic investment partners made up about $6 million so that is still about $9 million in public money.

The brand, website, software and offer document all looks fantastic, and is a credit to whoever put it all together, but this is still an unprecedented event I believe. The CEO Rod Drury, has a great track record, and I know he is very smart, with his most recent success being the sale of Aftermail for $60 million and assisting in the sale of TradeMe. Even so, I’m pretty amazed that this went through. I’m also a little confused as to why someone like Rod would want to go public so early. He could easily raise that sort of money elsewhere without the expense and hassle of an IPO. Maybe he is just proving a point that it is possible to raise significant funds from the New Zealand public markets.

It is without doubt a pioneering move and will hopefully pave the way for future listings like this. It also comes with a huge responsibility, if things don’t go well, they will be used as the benchmark example for other companies.

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