Basically parasites is what I think you wanted to say:cool:
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I for one cannot work this one out at all? Ever try currency trading Santiago? In every trade you take a short position. Stocks are different, granted, but if you are a trader, whether you buy or sell should be immaterial surely?
I love those that short stocks as it provides for better buying opportunities as the share price is artificially depressed. Without "shorters" these opportunities would not arise.
Well... shorter should not be legal as how could one trading something you don't own in the first place... that should belong to the black market IMO.
They already have possibly long before shorty... isn't it something called insider trading... :)
Didnt even have to check the XRO share price--i could tell it went down just by the comments made today
Well, the 'hanging man' daily candle (a reversal signal) wasn't confirmed Monday and the price bolted upwards! then today surged to the 61.8% fib on morning trade and slumped to back test the massive descending trendline (breakout) in the afternoon.
This volatile daily price action can tough on the nerves, so step back for a look at the weekly. There is reason for cheer as the current weekly price range has broken out of that nasty down trendline and is currently thrashing at both sides of major seller resistance and buyer support.
This could be a massive week for XRO, either way - if it closes above the down-trendline (now support) that's a good sign, or above the 61.8% fib a great sign for the bulls. Conversely, a close below the trendline would likely see a continuation of the down trend and a back-test of recent support in the $15-16 range.
Attachment 6460
I just think betting against a company's success is unpatriotic, unamerican, unproductive, and distorts the market short term. Ok for those of us that take long positions, but shorting seems to have become a kind of blood sport on other exchanges and I hope it doesn't become that way in NZ. It drives all sorts of unhealthy behavior like poor analysis designed to spread FUD so others can take advantage of nervous investors. Like I said in my first post- it's a prejudice, maybe not rational, but I don't like it.
Maybe a glimpse of the future...
https://www.xero.com/blog/2014/11/xe...es/#more-46061
I think we shall just agree to disagree then. Thanks for your response. You state "I just think betting against a company's success is unpatriotic.. ". In my way of thinking shorting is "betting against a company's short term share price". When I shorted XRO a while back it was not that I thought the company was inept nor was I betting against its success. I was just of the view that the share price had outdone itself. I believe XRO is a great company and think it will do exceptionally well. I have seen it in action as my brother uses it in his practice. However I do not feel the company's exceptional prospects do the share price justice and as such I had shorted. If XRO was at say $4.00 I would probably be a buyer. At $36 I was/am a seller.
Cheers for that.
It's the "big data" stuff, and hence the ability to make comparisons to other similar businesses across the key performance indicators that will, IMO be the future.
Assuming NZ will again be the testing ground for this stuff, and I suspect some seriously interesting research will be done in years to come on the change in NZ's productivity, in this respect, and several others that XRO is working on too!
I'm happy with that, I like an amicable disagreement. I should disclose that I'm also hypocritical in this regard, having sold some of my own shares in XRO in the high 30s and then buying back in at the low 20s for the same reasons you outline. However, in that case I was not borrowing someone else's shares and actively betting against the company. Nor would I have published trash about the company to try and force the price down to profit. It's the incentives that shorting drives that I don't like, and find unnecessarily destructive.
Interesting article ? Cost $1000/client to develop
http://www.digitalfirst.com/2014/08/...OutbrainWidget
Hi Kiaora,
I've been wondering for a while, with regards to the KPI dashboard they have been talking about, what rights (legally speaking) do Xero have to use information from their customers, which can then be aggregated (by sector maybe) and then fed back to their customers to provide benchmarking information so individual businesses can see how they are performing relative to other similar businesses?
Hi TT
That is an interesting & valid question regarding information from their customers.The same goes not just for Xero but I would suggest other software providers such as google & Facebook.I would think it is buried somewhere in the fine print when a customer signs up to their services that they can use information as long as its not of a private/personal nature ???
Yeah, I figure it's something the customer agrees to when they sign up. Maybe someone can confirm?
It's just in the recent vid XRO provided re KPIs, XRO alluded to benchmarking against comparable businesses, but the actual dashboard they displayed only contained indicators using the customers own data - trend over time.
Imagine how much productivity gains could be made within sectors if you could see how you are tracking relative to your competition in key areas.
From the T&C
My reading of that is they aren't allowed to aggregate your data with others and provide to others. The initial roll out will not provide comparison to others (this is confirmed on their blog). My guess is they will either update their T&C or comparisons will be opt in, in which case you will only be able to compare to others that have also opted in (or they may do opt out if you don't want your data).Quote:
Ownership of Data: Title to, and all Intellectual Property Rights in, the Data remain Your property. However, Your access to the Data is contingent on full payment of the Xero Access Fee when due. You grant Xero a licence to use, copy, transmit, store, and back-up Your information and Data for the purposes of enabling You to access and use the Services and for any other purpose related to provision of services to You.
Once they do do, I wonder how granular you will be able to be - business type/location/turnover/staff number/etc
Yup, sounds like it. Which is a rap shame. I would have thought it would be worth tweaking those T&Cs soon (in NZ only) so that as soon as possible they can start working on a benchmarking roll out. It would be fascinating stuff to see how, at a macro level, something like this could affect the productivity of certain sectors. the country.
Hmm Its a been a wonder to me for a while now who owns what, particularly with big data analysis by a number of companies.I hope all companies have got all their I's & T's crossed and it's a wonder no one has contested it up to now.Information is power,is money
Looks like their current T & C allow aggregation and feedback??
"You grant Xero a licence to use, copy, transmit, store, and back-up Your information and Data......and for any other purpose related to provision of services to You." (Edited from source post # 5617)
Get the customers, change the T&C's. Facebook once had near 95% privacy, it now sits at just over 5%. Not really apples and apples but I imagine that's how it will work. And rather than opting in I would guess you would have to opt out, and be penalised by not being able to access the data from other businesses by doing so.
This is a very valid point and an interesting ,if not scarey area--its any ones guess how the company will respond if leaned on hard by the US agencies(the National gov. will certainly not come to the rescue)John Key is a business man and seems to be happy to fall in with ''American interests''and the $$ that can be made from them.(sometimes at the expense of privacy issues.
Correct me if Im wrong but doesnt Xero have a policy of ''ownership'' of the customer information on the cloud?
i seem to remember them withholding it in certain situations.
These are some relevant 'excerpts'.
DYOR ... if you want to read the entire T&C's and Privacy Policy, they are in the public domain:
Xero T&C's: https://www.xero.com/about/terms/
"Confidential Information"includes all information exchanged between the parties to this Agreement, whether in writing, electronically or orally, including the Service but does not include information which is, or becomes, publicly available other than through unauthorized disclosure by the other party."Data"means any data inputted by You or with Your authority into the Website.
Confidentiality:
Unless the relevant party has the prior written consent of the other or unless required to do so by law:
- Each party will preserve the confidentiality of all Confidential Information of the other obtained in connection with these Terms. Neither party will, without the prior written consent of the other, disclose or make any Confidential Information available to any person, or use the same for its own benefit, other than as contemplated by these Terms.
- Each party's obligations under this clause will survive termination of these Terms.
Ownership of Data:
Title to, and all Intellectual Property Rights in, the Data remain Your property. However, Your access to the Data is contingent on full payment of the Xero Access Fee when due. You grant Xero a licence to use, copy, transmit, store, and back-up Your information and Data for the purposes of enabling You to access and use the Services and for any other purpose related to provision of services to You.
Privacy Policy: https://www.xero.com/about/privacy/
Xero can aggregate Your non-personally identifiable dataBy using the Service, You agree that Xero can access, aggregate and use non-personally identifiable data Xero has collected from You. This data will in no way identify You or any other individual.
Xero may use this aggregated non-personally identifiable data to:
- assist us to better understand how our customers are using the Service,
- provide our customers with further information regarding the uses and benefits of the Service,
- enhance small business productivity, including by creating useful business insights from that aggregated data and allowing You to benchmark Your business’ performance against that aggregated data, and
- otherwise to improve the Service.
In other news, I read that Rod expects Monchila integration to be complete by mid-next year and for Xero to have a payroll system that will be far beyond what the competition is currently offering and something that will take a long time to catch up.
Also, they've announced the USA Xerocon for around the same time, so obviously they look to launch it there with a big bang. Wonder if US listing will follow at the time to capitalize on what they hope to be a bit of good publicity for the company?
The key point is 'to You' at the end. Having said that, I missed the privacy policy (see below)
Probalby with changing T&C is you have to publish,then everyone complains. Looks liek they have already done it though.
Data is owned by the owner of the account, not the company whose data the account relates. So if your accounting firm sets up your account, then the account belongs to them. They do have a disputes policy.
I didn't read the privacy policy which appears to be the relevant one. I bolded the important line.
Since haters gonna hate:
http://exactcpa.blogspot.com.au/2014...ake-us-in.html
I've just worked my way through this long article along with the original Digital First article that it was based on (http://www.digitalfirst.com/2014/11/...take-us-hurry/).
I'm a little unsure what to make of it and it makes me wonder whether ExactCPA have an axe to grind. They are so unfailingly critical of of Xero that I'm suspicious of their motives. They seem to see a world of clover and honey where Intuit are the only provider of cloud accounting services.
There are definitely problems with Xero and getting customers in the US is going to be difficult but I don't feel as enlightened after reading this as I might've hoped.
I don't think anyone knows what Xero's prospects in the US are. Rod seems to think it's all sown up. ExactCPA think Intuit have got it sown up. Truth is going to be somewhere in the middle.
The first line reads "Last month thanks to Intuit" - well well no surprises there!
All this really tells me is that the war continues to escalate (as expected), Intuit are throwing everything they can into this (commissioning articles, over and over) - they obviously still feel very threatened. They playing field is slowly being levelled as Intuit have stated they cannot keep their monthly subscriptions at such low prices - and when they price is similar - which option do you choose? Also, they never have a bad thing to say about Xero's software - signalling Intuit's recognition of their inferior product.
Furthermore the article says previous comments on Xero's part were incorrect ("litigious nature of the US"), and that actually "one of the first things accountancy firms do is is recommend software" - If true Xero's is about to deliver a few kidney punches to goliath (tax for all states - opens up larger firms to poach, who probably expect all states to be covered before considering adoption).
More important things - Rod is happy as Larry today.
His new Boostedboard skateboard has arrived and he trying it out with other xero guys on the waterfront.
It's got brakes as well .....so now you know
I agree this article cannot be trusted. If anything, it only shows that Xero valuations neglect the payroll market. Until now, people used to add the market caps of Intuit (20b), Sage (5b) and MYOB (1B) multiplied by 2 to get to a future market cap of 50b for Xero. In reality, due to the acqui-hire of the 8 man strong Monchilla team, which gives them a clear edge over all competitors, one should also add Paychex (17b; 12000 employees), ADP (41b; 60000 employees) and multiply by 3. That gives us a conservative target of 250b for Xero, which is around $2000 per share. Again, that's just a conservative valuation
$20 by January? That's borderline stock knocking!
January will be bloody close to the release of quotes. That's a feature that only QBO, MYOB, Sage One, Wave, Freshbooks, Outright, Kashoo, Saasu, Freeagent and some others have. It will put them miles ahead of the competition who will never be able to catch up. They just can't turn the ship around. That's a fact. Also early next year will be close to the Nasdaq listing. That alone will drive the price above $80-90.
Casino that stuff you've been drinking today I'd like some:cool:
Perhaps he's feeling the burn of the recent pullback and had to substitute vodka for methylated spirits? lol, just playing Casino - but interested to know what your really getting at....
It was six men of Indostan
To learning much inclined,
Who went to see the Elephant
(Though all of them were blind),
That each by observation
Might satisfy his mind.
The First approach'd the Elephant,
And happening to fall
Against his broad and sturdy side,
At once began to bawl:
"God bless me! but the Elephant
Is very like a wall!"
The Second, feeling of the tusk,
Cried, -"Ho! what have we here
So very round and smooth and sharp?
To me 'tis mighty clear
This wonder of an Elephant
Is very like a spear!"
The Third approached the animal,
And happening to take
The squirming trunk within his hands,
Thus boldly up and spake:
"I see," quoth he, "the Elephant
Is very like a snake!"
The Fourth reached out his eager hand,
And felt about the knee.
"What most this wondrous beast is like
Is mighty plain," quoth he,
"'Tis clear enough the Elephant
Is very like a tree!"
The Fifth, who chanced to touch the ear,
Said: "E'en the blindest man
Can tell what this resembles most;
Deny the fact who can,
This marvel of an Elephant
Is very like a fan!"
The Sixth no sooner had begun
About the beast to grope,
Then, seizing on the swinging tail
That fell within his scope,
"I see," quoth he, "the Elephant
Is very like a rope!"
And so these men of Indostan
Disputed loud and long,
Each in his own opinion
Exceeding stiff and strong,
Though each was partly in the right,
And all were in the wrong!
MORAL.
So oft in theologic wars,
The disputants, I ween,
Rail on in utter ignorance
Of what each other mean,
And prate about an Elephant
Only Rod Drury has seen!
Hey blackcap - can you tell me what broker you used to short Xero ?
From my understanding the half yearly results should be released today, hopefully we will see some positive news.
Love some of the charts in the half year = amazing
Opening comment more bullish than usual
Xero Limited (XRO continue to deliver high growth as the business builds capability to serve millions of small businesses on its financial platform.
But snaps it is a monthly rate of 4.2% - 4.2% of customers They had at beginning of month) left every month. So plenty just trying it out or what.
However quite normal according to Rod's man as below but seems high to me and not providing that stickiness yet
Customer churn is the number of customers who leave Xero in a month as a percentage of the total customers at the start of that month. The percentage provided is the average of the monthly churn for the twelve months to 30 September for each year.
There has been a significant improvement in customer churn rates in New Zealand, Australia and United Kingdom which reflects the ability to create “stickiness” where Xero has a longer term presence and greater product awareness in the market. The comparatively high churn rate in North America is not unexpected given the stage of the market and is in line with other markets at the same time.
What would be more insightful is to know what the breakdown of the churn rate is of business closing up shop versus moving off to another accounting solution because one of those options is impossible to do much about.
Quick number Nort America for H1
Opening number customers 18,000
Customer defections 4,600
New customers 8,600
Customers Sep14 22,000
That's how I see it anyway .... unless my logic and understanding of churn rates is ****. Please correct me if wrong
But Rod's men says its expected to have such a high rate of defections
I suspect intitutional buyers will react and start to accumulate tomorrow as the report was released latish in the day. Today's late sellers would have been traders who got spooked. Strong support for $17 area at close of trade
In an odd sort of way, perhaps Intuit peddling QBO so hard will in fact accelerate the adoption of cloud accounting in the conservative US market much quicker than if Xero were trying to force the issue on their own.
DISC - glass is half full.
Give me 180million I bet I can burn less cash than Xero in 6 months. I'm confident my net loss would be less than 20M. It will only go towards my lavish lifestyle.
The results look pretty good to me. The speed it gains new customers does not matter as much as how many customers they will have long term, and how much money they will make long term. It looks like they can continue to gain customers at a reasonable rate. People just need to be more patient I guess. Perhaps we can compare US to when the company first started, and in a few short years, we'll see Xero become unstoppable in US. I'm looking forward to the day Xero reaches the next milestone of 500k customers, then 750k, 1m, 1.5m, 2m and beyond.
DISC no position in XRO, just really like the company.
Best way to explain it is in the words of Rod Drury: 'It will take Intuit a long time to catch up. Xero is developing at a faster cadence than Intuit and the gap in features will increase, not decrease because Intuit is such a big ship to turn around.' And like it says in the interim report today: 'Xero’s exceptional growth in New Zealand, Australia and the United Kingdom continues to extend its leadership in cloud accounting,...'
Intuit may have added 60k QBO subscribers over last three months alone, which is triple of Xero's total in North America but that would only prove one thing. Cloud accounting is synonymous with Xero. To say otherwise is like imagining the internet without AOL. Like Time Warner confronted with a new era, we may see a merger of Xero and Exxon to become the world's biggest oil small business cloud accounting conglomerate. Exxon Xero, EXXXero or Xerexxon? About the name I'm not so sure but you heard it here first!
Changing subject...
What does everyone think about the Business Dashboard?
Just to be clear, nothing I said was incorrect. What you calculated was the annual retention rate, extrapolated from the monthly churn rate - that I agree with. It was your inference (in relation to XRO) that I am not comfortable with.
"If 95.8% of the customers at the start of the month are still customers at the end of the month, then the total remaining at the end of 12 months is 95.8%^12 = 59.8%"
Your above statement is only true IF you assume no new customers - do you agree with that?
I don't have access to some of my historical data, but just to clarify, 18,000 to 22,000 is for the 6 months to Sep 30 2014 right?
If so, assuming a constant net growth rate in customers over time, and an average monthly churn rate (as per recent announcement), I get 4940 defections and 8940 new customers.
Out of interest what formula are you using to get your numbers (Winner & Mikey)?
Business Dashboard looks great. They're lining up their Xerocon's well. Biz Dash will be the centerpiece of Xerocon UK, and US Payroll the talking point of Xerocon USA mid year. Should be an exciting first 6 months for the company.
Again, your statement is only true IF you assume no new customers. Therefore, in the context of Xero, your statement is not accurate.
"If 95.8% of the customers at the start of the month are still customers at the end of the month, then the total remaining at the end of 12 months is 95.8%^12 = 59.8%"
Attachment 6494.
..........
Give it a rest. It's a "hypothetical situation", clearing indicated by the IF at the start of the sentence. I don't think you're adding anything here by labouring this point. I'd say it's not an inaccurate statement, just that the obvious effect of new customers might be left as an exercise to the reader.
However, considering that Xero only really had a net gain of 4000 customers in the US over the last six months, which should be a big growth market for them, I would consider 4000 new customers much closer to 0 new customers than I would like. It's basically no new customers. It's 50% annual growth when I wouldn't be surprised if the UK grows 200% this year.
And, 4.2% monthly churn (which might be described as 40% annual churn but you don't seem to like that) doesn't sound good at all, especially compared to the 1% churn in NZ, AU and UK.
Just on those churn rates, which are very low for NZ, Aust and UK. I wonder what percentage of those customers that do leave Xero leave because they're going out of business (the failure rate of SMEs being reasonably significant I would imagine) and how many leave due to dissatisfaction with the product or a preference for another service. Making some pretty simple assumptions, it does seem like the retention rates are impressive in those markets. Here's hoping the U.S. trends that way too...
Mikey, I don't have no problem with saying the annual churn rate as 40.2%, I never suggested or stated I do (it is after all a correct measure).
My post was largely in response to what I had read on this thread, where many people were clearly confused about what churn rates are, how to convert a monthly rate to an annual rate, and more importantly what these numbers actually mean. As you must surely appreciate, many on this thread had posted incorrect information. My interpretation is that these threads are for sharing information and/or learning. If info posted is wrong or unclear then typically neither will be achieved.
That being the case, I'm still interested in the way you calculated new customers vs costumers lost for the period as there is a bit of discrepancy between my calculations and yours and winners.
Just heard a Xero ad on the WTF with Marc Maron podcast one of the most popular podcasts in the world.
discl. do not hold
Here is what Rod Drury had to say about a year ago in regards to churn:
@Graeme churn is around a percent a month. All our numbers are net of churn. Our churn rate is less than the death rate of businesses and we of course monitor churn closely. We don’t see people going anywhere else and the main reasons for leaving ‘not ready for accounting’ or ‘out of business’.
The reason our churn numbers are low are
1. We are conservative about counting customers. We only count them when we have billing details and by then our customers are pretty committed.
2. Accounting software is sticky. So customers are hard won but when we have them they tend to stay if you treat them well.
You could argue that businesses with online accounting are more likely to survive on our numbers. That would be a useful study.
It’s very interesting to look at customers now as our numbers have become significant. As a pure-play SaaS accounting vendor our Customers, Revenue and therefore ARPU are clear to see. In MYOB’s recent update they did not disclose online customers or revenue. Intuit continues to obfuscate their QBO count and revenue in their reporting.
We challenge them to come clean with their numbers. It’s important for the industry to know where the customers are and who’s strategy and platform are working as their industry makes their investments.
Well, Intuit numbers are out as for every quarter...
QBO subscribers are at 739k up by 56k (slightly down from previous two quarters, 43% up y-o-y). That's only twice as many compared to the leading cloud accounting provider Xero.
Of those, 103k are non-US subscribers. Less than five times of Xero's US customers.
Revenue for this quarter came in 50m higher than analysts estimated. Xero reported 50m revenue for the past 6months.
This is clearly a big ship that can't be turned around.
In other news, Bain is planning a 2.6B IPO for MYOB. I checked the calendar and it's not April 1.
http://sixteenventures.com/saas-churn-rate
Acceptable Churn Rate
In line with my experience and as I cited in my Sandhill.com article, Bessemer Venture Partners says an acceptable churn rate is in the 5 – 7% range ANNUALLY, depending upon whether you measure customers or revenue.
1% monthly churn is 12-12.5% annual churn. 4% monthly churn is ~39% annual churn.
yeah but i'd take it with a grain of salt - xero make a good point that their churn is equal to the death rate of young businesses which makes sense. Xero are also growing revenue by 80% and thats no mean feat (revenue would be growing by even more with less churn).
The US churn would worry me - but I guess thats the reason they acted quickly to excise the tumour.
The only thing that bothers me, and this is consistent with all listed tech companies on the nzx, is the way they provide misleading news and outputs - eg why give monthly churn rather than annual churn if not because monthly churn looks very very small and to the uninformed punter would seem inconsequential.
I dont know all too much about churn but intuitively I would expect that any SAAS company with a lot of small businesses as clients would have a higher than usual churn, as young companies typically die off at around 15% - 20% per year (in the US at least).
4% monthly churn ≠ 40% annual churn.
Month New customers Leaving customers Churn Jan 100 4 4% Feb 100 4 4% Mar 100 4 4% Apr 100 4 4% May 100 4 4% Jun 100 4 4% Jul 100 4 4% Aug 100 4 4% Sep 100 4 4% Oct 100 4 4% Nov 100 4 4% Dec 100 4 4% 1200 48 4%
swandri,
At the risk of getting scolded again for making sure everyone is on the same page re these churn rates.
From the XRO report:
"Customer churn is the number of customers who leave Xero in a month as a percentage of the total customers at the start of that month."
In your calculation you are only calculating (and then summing) the number of customers lost as a percentage of new customers each month - what about the "total customers at the start of that month"
You will find you get quite a different answer if you calculate customers lost based on the total customers at the start of each month.
yeah guys - churn is a measure of how many people left that were customers at the start of the period - it defeats the purpose by adding new customers to the calculation (and by doing so you are starting to compare apples to oranges). The point is to measure loyalty/stickiness of existing customers.
Other people have already illustrated the calculations but using the USA 4% monthly churn - a reasonable approximation of annual churn might be 100% - (96% x 96% x 96% x 96% x 96% x 96% x 96% x 96% x 96% x 96% x 96% x 96%) = ~39%
Cheers
My original calcs more mental arithmetic and rather simplistic. I apologise for that
Using your assumptions I get close to your numbers.
Lets forget the maths and just agree in round terms in North America for every two customers Xero sign up one existing customer defects (and that's painting a slightly rosier picture than the numbers suggest)
*SIGHS*
Really guys, this day in age?
http://bit.ly/1zIDsnW
Cheers mate, yeah the States is an interesting one, but if you apply some logic to that one you can see how churn improves as geographical markets become more mature. It's a shame we don't have historical data on churn for NZ, OZ, and the UK, it would be interesting to see how they compared in the early stages of growth, my guess is they may have been quite similar to the US (probably not quite so high due to differences in business culture and market environment). Churn will certainly come down in the US though, give it a couple of years and I would say it will be well under 3%.
It may even drop in the short-term. My suspicion is that the H&R Block deal didn't go down well costing them a few partners over the last few months. May also be the reason why Karpas got the boot. But that's a one-off and out of the way now. Churn will always sit a bit higher in the US because of direct business but I see that as a positive.
Brave assertion - the churn has INCREASED 2014 over 2013.Quote:
Churn will certainly come down in the US though, give it a couple of years and I would say it will be well under 3%.
I don't/haven't owned any of these other than very early on, and haven't taken too much interest other than to watch the rising price in complete disbelief, but it seems to me that this churn rate statistic might have been the catalyst for the price collapse from the $45 heady days, but only those with an understanding of the underlying consequences were able to take advantage of the idiotic prices and get out.
Seems the dawn of realisation is only just hitting the mainstream?
But 5000 odd defections in the last half is a staggering number.
Assume there is some 'stickability' and customers don't just give it away after a few months that 5,000 needs to put in the context of say the number of customers thy had a year ago .....seems mass desertion to me
It is. So is the number of negative comments the H&R deal drew on the Sleeter blog:
http://www.sleeter.com/blog/2014/05/xero-and-hr-block/
I'm baffled by the outrage. Accountants in the US seem extremely insecure and react allergic to any change. Lesson learned.
I agree with you in that cloud customers are sticky but perhaps not as sticky as Xero makes it out to be. You could argue that this works both ways. If Intuit can get Xero partners on the new QBOA, lots of existing customers will be in jeopardy. Xero may in turn be able to flip some of the 739000 QBO customers somehow.
The stickyness would increase over time. If you have been using it 3 months, not such a big deal, if you've been using it for 3 years, then more sticky. I think this is one reason the churn will decrease. As a very high % of customers are new (of total US customers), so the product isn't that sticky yet.
Exactly. It would be useful if XRO broke down the churn by length of time since the customer signed up. That would show a clearer picture and allow comparison across geographies. With any product you will have tire kickers who try it out for a few months and then drop it. With the base number in the US being lower, and the growth rate higher than NZ/Aus, those that drop out in the first few months will have a greater impact on overall churn %. Losing customers in the first few months is expected, losing long term customers would be a worry.
Bilbo and Harvey, you guys are bang on the money - that point appears to have been lost on some people. For that reason alone, churn will improve over time (and is why it has done so in other regions). Casino's point/hunch re the H&R Block deal (if correct) would have had a significant impact as well, and would help to explain the small increase in churn in the US over the last 12 months.