Interview with Peter Karpas, CEO of North America, Xero
What role does your organization play in supporting small businesses?
At Xero we make beautifully-designed online financial accounting tools. We make it easy for business owners to stay on top of their finances no matter where they are, and to get quick, real-time insights to make smarter business decisions. In my role here as CEO, I talk to a lot of business owners and it’s very clear that none of them have gone into business because they want to do accounting or follow up on unpaid bills. I’ve heard time and time again how busy they are and as a result their finances slip through the cracks — they lose checks or quite simply forget to bill or follow up on an overdue payment. And when they do get paid, they often don’t have real-time insight into their cash flow to know if they’re going to have enough funds in the bank to buy extra inventory or hire a new employee. These are the important problems that Xero solves for small businesses.
Running a successful small business is hard work. What are some of the key challenges that face small business owners today?
The two biggest challenges are getting customers and getting cash flow. But what really stops a small business from growing is cash flow — that’s why it’s so important. As a small business it’s hard to get loans, but if you have a healthy cash flow you can spend money on marketing, hire people, get more inventory, etc. — any of the things people can do to make their business thrive.
What is the best piece of small business advice you would like to share with our audience?
The biggest single piece of advice I’d give small businesses is to know when to do it yourself, know when to do it with assistance, and know when to get someone else to do it for you. Many small business owners I talk to want to do it themselves. They think they are saving money by not hiring a bookkeeper or accountant. So they spend their weekends doing accounting when they could be growing their business or spending quality time with their family. Then there are other things that they should do themselves but they outsource them instead. So think hard and make thoughtful choices about what you do or do not do. But always keep in mind, the more you do yourself, the less able you are to scale.
What is the next big thing that will shape small business?
The rise of cloud and mobile is transforming small businesses today. To simply be able to access your information and data from anywhere on any device. And we’re still in the infancy of the impact that these tools have on society and small businesses. As smartphone penetration and internet bandwidth increases, cloud and mobile tools like Xero get more robust. So now you see even non-tech oriented businesses such as brick and mortar stores giving salespeople tablets so they can provide better customer service by walking around with customers and ringing up orders in the middle of the store. This data is then immediately synced with the store’s point of sale system, and with the power of the cloud it is seamlessly transferred to the accounting solution. There’s no more waiting until the end of the day to account for that day’s sales. It’s happening in real-time and immediately going to all the right places without having to waste time manually re-entering data at the end of a busy day or week.
San Francisco is a hotbed of entrepreneurial activity. Can you share one brief story about how your company is helping San Francisco businesses to thrive?
As more startups, artisanal, and established businesses in San Francisco turn to mobile and the cloud, Xero is helping them take full advantage of these tools to save time and better run their businesses. We serve a variety of businesses here in San Francisco including specialty boutiques, creative agencies, cafes, tech startups, non-profits and restaurants. I believe helping these kinds of businesses succeed helps keep San Francisco’s unique flavor and culture alive. You can read and watch videos of the types of businesses we help at: http://www.xero.com/us/customers/.
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