Target for Xero: $100m a month

Software firm’s new chief, tech veteran Steve Vamos, is expected to aim high

Thirty-year tech veteran Steve Vamos has been charged with making Xero a $100 million a month global firm when he takes over the reins from founder Rod Drury next month.

Sydney-based Vamos will take over as chief executive on April 1, with Drury stepping down but maintaining a role as a non-executive director.

Drury said the pair had known each other for 20 years, and he credited Vamos with helping build Xero's success in Australia.

After joining the company in a consulting role 18 months ago, Vamos said he was looking forward to taking on the day-to-day operations.

“I've been working with Rod and the leadership team for the past 18 months and I'm well aligned with the company's strategy. I'm looking forward to working with the team to execute it,” he said.

“What Rod and Xero have accom- plished is rare and remarkable. I'm excited to have this opportunity to lead Xero's growth and development going forward.”

With the company breaking even, on an earnings before interest, taxes, depreciation and amortisation basis, for the first time last year and passing one million subscribers, it was the right time to change the leadership and bring on a chief executive that could help continue Xero’s expansion, Drury said.

The company had considered several candidates internally, but Vamos was the right fit, Drury said.

“Two-and-a-half years ago we passed that important $100m annualised revenue mark, and over the last year we've got to $100m a quarter, so we're now looking at how do we get that up to $100m a month,'' Drury said.

“We realised we needed someone who knows how to take a business from this great foundation to really getting that international connectivity working and that's really not my set of skills.

“We've got to know Steve really well and we trust him, and we're very confident that he has the skills the business needs right now.”

Vamos has no plans to shift the company's headquarters from Wellington and would remain in Australia for now, travelling between the two countries.

Chairman Graham Smith said the appointment offers a smooth suc- cession for Wellington-based Xero to transform from a founder-led company to a multinational entity, with the scaling up of the business requiring a different set of skills.

“The board had been discussing succession over the past year, and that “came to a head towards the end of the year”.

During his time as a consultant, Vamos had helped developed Xero’s leadership structures for that transition. His availability was one of the factors the board considered, Smith said.

“Success of the next phase relies very much on leadership alignment and continuing to hire the very best

talent for global execution.”

Tech commentator Bill Bennett said that throughout his career Vamos had been viewed as a solid leader.

“During his time at Apple and at Microsoft, he had a reputation of being a very competent CEO,” Bennett said.

“He was very much a button-down-collar guy and he was very solid in those roles. He was well-regarded.”

Vamos will start on a base salary of A$900,000 ($965,800) per year plus superannuation and shortand long-term incentives.

Drury said he planned to focus on the innovation side of the company and was not looking at taking on roles or directorships with other companies.

The founder retains a 12.8 per cent share in the business.

“Rod has identified that he’s not a corporate man, whereas Vamos is. The other thing about Steve is he can manage a business of that scale,” Bennett said.

“Rod has done 11 years there and he probably wants to enjoy himself now.”

Vamos currently serves as a non-executive director of Telstra and Fletcher Building.

Xero shares last night closed down A$2.03 or 6.17 per cent to A$30.85 on the ASX.