Australian small business accounting service provider Xero is on the up and not just on its home turf. The company has seen significant traction in the U.S. market, and that led to reports that Xero was planning an initial public offering in the country early next year.
But reports in The Sydney Morning Herald suggest that a U.S. IPO isn’t quite yet ready to happen. That’s despite a recent IPO of cloud SaaS company Atlassian, another Australian firm that saw an $8 billion valuation in the U.S. with its debut.
While that means Xero wouldn’t have to be the first Australian tech company to have a successful IPO in the Northern Hemisphere, reports said that the company will be waiting at least a year until it can follow suit.
"The Atlassian experience now gives us a really nice local benchmark of what those numbers look like for our listing,” said Xero Founder Rod Drury to the publication in a recent interview. And while he added that the company has enough financial success in the U.S. to list and even beat out its top local rival, Intuit, Drury suggested that U.S. investors will need more time to provide the same financial backing they did to Atlassian.
"The difficulty of listing in the U.S. is that U.S. investors primarily look at the U.S. performance,” he told the publication. “We have really been focused for the right years outside the U.S.”
According to reports, Xero has only been operating for about two years in the U.S.
Drury added that the company will continue to secure new SME customers and focus on strategic investments in order to ready itself for an IPO in the U.S., a move he said would be crucial to Xero from a marketing standpoint.
[bctt tweet=”‘Once you are listed in the U.S., you are truly a global company.'”]
"Once you are listed in the U.S., you are truly a global company, and it is much easier for those big tech investors to invest in you,” he told reporters. “We are still seen as slightly weird being listed outside the U.S."