Data-driven innovation will only accelerate in the years to come. Headlines continue to flash bold predictions about a future in which technology that relies on massive data sets, such as AI and machine learning, will increasingly dictate the way we work, communicate and consume.
It’s clear how tech giants will continue to thrive in this new world. But what about the rest of the economy? How will small businesses — and the people who support them, such as accountants and bookkeepers — come out ahead?
At Xero, we’re hard at work building a platform that is tailor-made to deliver on the promise of leading-edge, data-driven technology on behalf of small businesses and their advisors. We want to connect millions of small businesses around the world so that their collective power is equal to, or greater than, the biggest companies.
Today, the reality is that despite huge advances in technology, small business owners continue to be at a distinct disadvantage compared to large corporations. This disadvantage arises primarily because small businesses are isolated, and often left to tackle the huge challenge of building a business on their own.
This isolation and self-reliance is easy to see in the way small businesses go about handling their finances — managing cash-flow, getting paid on time, or securing a loan. According to a recent Federal Reserve study:
64 percent of US small businesses owners faced a financial challenge in the past year. The top challenges were: paying expenses (40%), accessing credit (30%), and managing debt (25%).
These financial challenges lead small businesses to making choices a big company would never have to confront — 67 percent used their own personal funds to compensate for shortfalls in their business. These business owners also resorted to tactics such as taking on additional debt (39%), cutting staff or downsizing (33%), and make late payments on bills due (28%).
At Xero, we believe that we can use the power of technology to help solve these problems. Small businesses don’t need to be isolated or self-reliant. Through our global platform, we can create deep connections with millions of small businesses and their advisors. And we can leverage the collective power of those connections and the trillions of data points that result to put the data-driven technologies tech giants are using, such as AI and machine learning, to work making small business, big business.
The Xero platform is already facilitating the flow of a massive amount of small business data. Our 1.6 million subscribers produce 62 million customer connections and $2.4 trillion in transactions each year. We are committed to acting as a trusted steward of this data, putting it to work on behalf of small businesses and their advisors.
We are already putting this data to work to deliver some tangible benefits to small businesses. For example, we recently announced that Xero has delivered more than one billion machine learning recommendations, making it easy to quickly code and reconcile transactions so that a small businesses books are always in order.
The future is even more dynamic and exciting. Truly putting the data in the Xero ecosystem to work means delivering breakthrough solutions that help small businesses and advisors tackle the biggest financial challenges:
Money: Xero will make it easier for small business to get paid faster, access a loan when needed, and deliver a real-time view of their cash-flow position. For example, Xero automates the invoicing process and makes it easy to see whether a customer has seen an invoice and if it’s been paid.
Efficiency: Xero will increasingly automate mundane data entry task so that small businesses and advisors can focus on making sense of their data, instead of collecting it. For example, Hubdoc (a Xero product) auto-fetches financial documents from over 700 utilities, telecom providers, and online vendors.
Confidence: Xero will enable even more seamless collaboration between small businesses and their most trusted advisors. For example, the real-time data within a Xero account will integrate with all of the solutions small businesses need, from payroll to tax to customer management.
We believe that technology shouldn’t exist to favor the big guys alone. Instead, we believe that it should be used as a force for good, enabling entrepreneurs and small businesses to succeed on a global scale.
With Xero, small businesses aren’t so little after all. They are connected through a global platform that, for the first time, will tip the odds in their favor.