Xero announces strategic partnership with Dropbox aimed at securing the small business market

- June 30, 2015 3 MIN READ

New Zealand cloud accounting software startup Xero has today announced a strategic partnership with Dropbox aimed at securing a significant share of the small business market.

The partnership will see the companies integrating their services in order to facilitate easier collaboration across the two platforms, like enabling Xero users to access and share Dropbox files from within Xero.

Dropbox, which is headquartered in San Francisco with a strong presence in Australia, has also signed on to be the major sponsor of Xerocon 2015 this August, where it will look to showcase the product integration to accountants and small businesses. It will also be present at Xero’s Developer Day to discuss how developers can better leverage Dropbox APIs.

Charlie Wood, managing director for Dropbox in Australia and New Zealand, said that by partnering with Xero, it is Dropbox’s vision to be at the heart of every growing organisation.

“Business continuity, accounting and collaboration are at the core of any successful business…cloud solutions from Dropbox and Xero provide an opportunity for rapidly growing businesses to accelerate and differentiate their services and offerings. Together, we’ll be able to offer everything a small business needs to get up and running from day one.”

Xero and Dropbox will soon be launching a special joint offer for small business customers.

Chris Ridd, managing director of Xero in Australia, said that the partnership with Dropbox is another step in the startup’s efforts to demonstrate continuing innovation and support for small businesses.

“We have seen huge, global growth over the last four years in particular, and earlier this month announced that we now have 500,000 subscribers. Combining our efforts with Dropbox will support us in becoming a smarter and even-better connected platform for small businesses,” Ridd said.

The partnership comes after Xero raised US$111 million in February from US venture capital firms Accel Partners and Matrix Capital, with Accel investing $100 million after seeing Xero’s potential to grow in the small business market.

Xero has cemented itself as the accounting partner of choice for startups across Australia and New Zealand. It also partnered with StartupAUS last year in a move that saw Chris Ridd join the organisation’s advisory board. It is now steadily chipping away at MYOB’s position in the small business market.

The partnership with StartupAUS followed a string of other alliances with high-growth business communities, like The League of Extraordinary Women, Startup Grind, and the ‘Xero for Startups’ program that the company launched with startup co-working space Fishburners. Part of the Fishburners program includes a six month free subscription to all new users of the platform, and it’s these initiatives that have helped Xero garner more than 160,000 paying customers across Australia.

Dropbox has also been getting closer to the startup space, announcing a partnership with Fishburners earlier this month that will see it deliver 12 months access to its Dropbox for Business service to Fishburners members for free – with the service otherwise charging a minimum of $85 per month, that’s around $11,000 worth of value per month for 12 months.

Dropbox will also also offer technical mentoring to Fishburners’ startups on how to utilise the Dropbox for Business API to enable team-level app management and integration with third-party services.

It’s not difficult to see how Dropbox’s focus on startups can support its growth strategy as it looks to transfer users from its free consumer product over to its paid business service: people pay attention to what startups are using, and when startups use a particular product, it creates a viral effect.

As well as startups wanting to use what their peers are using – with the domino effect working particularly fast in coworking spaces – larger businesses are increasingly looking at what startups are doing in order to systemise processes and maximise efficiency.

Image: Chris Ridd, Xero. Source: Provided.