Odd that the company without middle tier product is happy to proclaim the sector dead. I don’t really follow the logic that says because building a small business is easier, medium business will disappear. Mid tier companies perform many essential roles within the economy and have the added bonus of generally co-existing with each other in a diverse market without transforming it into an olig/mon-opoly type situation, while still providing the staying power, national/international support presence and many of the other lovely midsize benefits!

I do see your reasoning.

With that, out dated IT infrastructure is something that sits comfortably in both large and small enterprises, traditionally due reluctance towered change, cost, complexity or because it is not seen as being of any financial or operational benefit. One might argue that the only reason this does not occur to the same extent in the small business market is because of the sales, almost subscription, model that the major vendors in this space use. Another may be because the system is often exceeded in scope (an issue that now Xero is vulnerable to, but later where the API may save you), or that the system was never given proper attention to initially (what with all the fame and glory of a small startup!).

I am acutely aware of the dealings if the three vendors you listed, and know that to 1 or 2 of them the mid market is absolutely everything. While manufacturing may be an increasingly offshore activity, this creates a larger requirement for sophisticated and integrated distribution and inventory management systems then ever before.

Just my 2 foot foresight….

Yes feature creep slowly kills everything. This is why I believe the API is so valuable to you and why tighter integration with it could really benefit you long term. Even just developing your internal products with the API mindset could be a way to stave off “girth”. I do believe it is a tactical error to not offer homebrand inventory management and payroll systems, as well as all those other niceties that modern accounting packages have come to be loved for. Not that I know your tactics that is, more that it is something that I desire and know is desired by others.

While experience is considered absolutely essential to loved products, you do not develop consumer software. Yes elegance is an advantage, but insufficiencies eventually do catch up to and overlap a simple to use interface. Steve Jobs is a pretty snazy CEO, and his design team are world class, but they also make many errors following the simplicity path and are still struggling in a large portion of the business community today (an issue that appears to be very slowly going away). Xero is currently in a unique position, take inspiration but don’t copy, it won’t work in the long run.

Judging by some other posts on the blog, you guys have developed a culture wherein you believe the traditional ERP/Accounting companies are inept. I can see how that idea could be formed, they have lagged in getting onto the web (generally due to the complexity of their existing codebase) and often they make huge tactical errors (beliiiieve me). While your pool is pretty quiet right now, don’t think that you own it just yet, Sage, SAP and even dear little Microsoft have the people, knowledge, customer base, partner network, funding and international presence to absolutely dominate when their time comes. I believe Xero can do it, but it can’t think that the war has already been one.

That should of been http://www.cooper.com