Cloud a cure for Australasian tech's stunted growth, says Xero CEO and start-ups

And it's giving native new enterprises a spurt, says panel at AWS Summit

Public cloud services have removed the historic barriers that stymied the global ambitions of Australasian companies, Xero's CEO Rod Drury said yesterday.

Speaking as part of a panel of cloud-first businesses at the Amazon Web Services summit in Sydney, Drury explained that in the past, companies in the region were often forced to sell out if they were to succeed.

“Back in the old days the playbook for Australian companies was: build your enterprise software company up to a certain point, then flog it off to a US public company,” he said.

“So what we saw was a premature stunting of Australasian companies... we’ve always built great technology but we never really followed through because it was too tempting to basically sell the businesses.”

Xero has always run its infrastructure in the cloud, since it was founded in 2006. Initially hosted with Rackspace, late last year the New Zealand company completed a mammoth migration to Amazon Web Services — moving some 1.4 petabytes of data, 59 billion records, 3000 apps and 120 databases.

The accounting software-as-a-service provider now operates across Australia, the UK and the US. Last week, Xero announced it now had more than a million subscribers.

"What the [cloud is] doing now is allowing us to grow truly native companies that can be global," Drury said. “We’ve always had a great technology industry and now we’re able to really build these really global platform businesses. So, pretty cool.”

Businesses in the region also had an advantage now they were on a world stage: their values, Drury added.

“Most people around the world have a fantasy relationship with Australia and New Zealand. It’s a long way away, they know the lifestyle here’s pretty relaxed and all those sort of things,” he said. “Businesses from this part of the world have a really clear set of values and the world needs our values.”

All eyes on Oz

The Xero chief was joined on the panel by a number of Australian cloud-based young start-ups – kids health platform Elanation, social media influencer app Social Soup, electricity retailer Mojo and Roames, which captures 3D image data of utility infrastructure and its surrounds and was acquired by Dutch surveying company Fugro last year – each keen to emulate Xero's success.

Elanation CEO and co-founder Katherine Maree Pace said she felt Australian innovation's time had come.

“We’re at a real tipping point. There’s more eyeballs on Australia,” she said.

“It had been – how are we going compared to America, Asia or China? But it seems like today we don’t really need to compare ourselves any more... all of a sudden you’re going to get these countries going – how are we doing in comparison to Australia?”

Joining them on the panel, chief architect of AWS Glenn Gore, former CTO at Melbourne IT, said cloud had levelled the playing field for Australian companies seeking to compete on a world stage.

While the summit's opening keynote the previous day, given by Amazon CTO Werner Vogels had featured well established brands like Westpac Bank, Seven Group Holdings and Atlassian, Gore's address on Thursday, gave start-ups a chance to shine.

“It doesn’t matter if you’re big or small trying to go overseas. It’s fascinating how many brands from Australia are getting to that point I hear them mentioned by other big global nationals...brands are getting out there,” Gore said.

“For a country this size it punches well above its weight.”

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