Xero slows costs by extending training beyond partners

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Xero slows costs by extending training beyond partners

Cloud accounting vendor Xero has posted stellar results, landed its two-millionth customer and explained that ending partners’ exclusive access to some of its certifications has become a money-saver.

The company’s H1 FY 2020 report (pdf), released yesterday, contained some beautiful numbers: annualised monthly recurring revenue rose thirty percent to $764 million. EBITDA hit $65.9 million, up $31m year on year. Gross margin is 85.2 percent. And subscriber count topped two million and kept going to reach 2.057 million.

The company even made a profit of $1.3 million.

The channel helped the company get there: the report lauds the North American and UK channels for being big contributors to growth in those territories.

But there’s also a barb for Xero’s accounting partners, in the form of the observation that a customer education push has seen the company open its Xero Advisor certification to all customers. Previously the certification was only available to Xero accounting partners, who typically accountants that resell the service to their business clients.

Xero said allowing customers to attain the certification has “allowed headcount to increase at a much lower rate than subscribers and revenue,” suggesting the larger pool of trained users means the company’s support burden has reduced commensurately.

Offering customers the same certifications as partners is nothing new - an end-user or partner can take the same Cisco or Microsoft or VMware exams and those vendors encourage partners and users alike to do so.

Yet Xero talks up its advisor certification as offering "the knowledge and skills you need to serve clients" and "a solid foundation for becoming a proficient and effective advisor."

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