Posted on 22-Oct-2010 12:25.
Filed under: News
Online accounting software provider Xero Limited has announced that Peter Thiel, the San Francisco based investor and Silicon Valley authority, has agreed to invest NZ$4 million to support Xero’s expansion into the US market. He will also join Xero’s US Advisory Board.
Mr Thiel co-founded and led PayPal, the online payments company, which was acquired in 2002 by eBay for US$1.5 billion. He was also the first external investor in Facebook, and serves on its board. He is currently President of Clarium, a San Francisco based global macro fund manager.
The investment in Xero will be made through Valar Ventures LP, Mr Thiel’s New Zealand investment firm. Valar Ventures focuses on helping New Zealand companies in the post-revenue phase move into global markets. The Xero placement is the firm’s inaugural investment.
The capital raising, made via a placement, is expected to close next week and will be priced at NZ$1.4918 – the volume-weighted average share price of Xero over the thirty trading days prior to 20 October 2010.
“Millions of small and medium-sized businesses need an online accounting solution, especially in this time of increasing regulatory and tax complexity,” said Peter Thiel. “Xero’s tight focus, robust product, and strong team should enable it to expand tremendously in the United States.”
“We are delighted to welcome Peter and his team at Valar Ventures as strategic investors in Xero,” said Xero CEO Rod Drury. “Access to their extensive networks will provide a major boost as we take on Quickbooks in the vast US small business market. We have taken a measured approach to our US market entry so far. With the support of Peter and his team, we believe we are now strongly positioned to enter the US and capitalise on the opportunity that this market represents.”