Taking a chance on Xero

‘I’m starting my next big thing – you start Monday’

‘I’m starting my next big thing – you start Monday’

Faced with such a proposition, would you chuck in your job and risk it all? This is exactly what Xero founder Rod Drury asked chief technology officer Craig Walker, writes Ryan Willoughby.

Massey alumnus Craig Walker took the night to think over the offer but decided it was a no-brainer. Who would refuse the chance to be on the ground floor of a global accounting software company, which now employs more than 2000 people in 20 offices around the world? But on that night it wasn’t a global company, not even close.

Walker was being asked to sign up with a company without an office, a name or even a single employee. But come Monday he would begin work, tasked with translating the company’s vision into technical reality as the chief technology officer, from the kitchen table of his apartment.

A common theme of Walker’s re-telling of how he came to this position is luck. “I am kind of the living embodiment of, ‘It’s not what you know, it’s who you know,’ ” Walker says. “But at the same time, the only way that it benefits you is if you work hard and earn people’s trust – for them to take you along on their journeys, so you in effect make your own luck.” One of those people for Walker was Rod Drury, who proposed the job to Walker at Drury’s 40th birthday party.

“We had a five-second interaction in which he said, ‘Are you about done with this contracting bullshit? I’m doing my next big thing, you start on Monday.’ I think I took the night to think it over but I was never saying no. I had trust in Rod – we had worked together previously.

“At the time I was a small business owner, operating my business on an accounting system that was awful. So, to commit to a new venture that would solve problems that I was having myself just made sense. Rod had been talking for years about starting a company around online accounting services for small businesses. It was, in his view, the biggest modernisation opportunity on the web at that time. He was just waiting for the right time to do it.

“Our challenge was in building the solution, but not creating a market need. The need was already there. A lot of startups are solutions looking for problems, but in our case we had a problem in need of a solution. We figured it would be a slam dunk if we did deliver the technology.”

That said, the man who could see what Xero could become had struggled to decide what he wanted to do for much of his life. As a child, Walker dreamt of being an astronomer, as a teenager he reckoned he would be a pretty decent criminologist, and on leaving high school he was going to join his brothers studying law. But at the last minute he withdrew his application to Victoria University of Wellington and followed his mates to Massey’s Manawatu – campus.

After his mum was able to grind down the accommodation staff, he secured his choice of place in the halls of residence and began studying. But rather than study computing he pursued a Bachelor of Business Studies, not knowing what to specialise in.

When he took an information management paper as part of his first-year, that choice become clear. “I realised I liked it, and I was also quite good at it, so I switched to a Bachelor of Science. I began learning about IT management, databases, information architecture. These were topics I had never thought about before and my brain latched on to them.

“They have been critical, foundational skills for me throughout my career. In a nutshell, what I do is build data architecture and tools for data analysis. Essentially, turning data into useable information.”

However interested he may have been, the now-driven businessman describes himself then as a “lazy student” who would only fire on all cylinders when he had a project to work on that he was passionate about. This work ethic never ceased to antagonise his teachers but would end up landing him his first job.

“I remember a tutor pulled me aside in class, telling me off about how I didn’t pay enough attention,” he says. Coincidentally, right behind his tutor was a poster for graduate positions at Glazier Systems.

“That was one of Rod Drury’s and Andrew Kissling’s first ventures and I got the joke – they were a Windows development company and they called themselves Glazier Systems. I sent an email to the company based on that poster. I’d never heard of them, and I probably would’ve never heard of them if I hadn’t been paying attention [to the poster]. And that’s how I got my first job.”

After a few years with Glazier, Walker’s career began to gain speed and Drury singled him out to join his new spinout company VIATX after seeing Walker develop a new way of building software.

“The new company was selling software as a service, before this was even a term. I went from being a graduate developer to being an intermediate developer suddenly, then a chief technology officer of this little start-up. We ran it for a couple of years, and it died,” he says cheerfully. “I think any true serial entrepreneur has failures.

I wouldn’t class myself as one but that’s how you learn. The learnings from that I took into my next role.”

After running a virtual chief-technology officer consulting company for a number of years thereafter, Walker decided to pop along to his old boss’s birthday party, where he would be asked the question that would change his professional life.

How Xero took form

“My first days at Xero were at my kitchen table. It was fun. We would get there in the morning and fly by the seat of our pants. Designing and building on the fly and having arguments, but good arguments. Throwing ideas at the wall and seeing how they stuck. We didn’t want to build an accounting system that was rehashing what other accounting systems were doing. We wanted to build something new. Take a fresh look at the problem.

“If you had told me we would be a multi-milliondollar company with more than 2000 employees worldwide and more than one million customers, I would’ve laughed at you. I had no idea how big it could be. But I knew what we were trying to do. What’s weird for me, despite doing this for 13 years, is that Xero still feels early in its lifecycle. There’s more I want to achieve here – more growth I want to help the company pursue, more milestones around the corner.”

Walker is working on achieving some of those milestones in the United States, where he runs a New York City-based engineering team that builds new solutions for Xero’s customers. “I’ve wanted to live in New York ever since I was a kid. My first stop in the United States was in San Francisco. Once that office was up and running, New York was the clear next stop.

“The thing I’m most proud of is the teams that I have built. I’ve worked with some incredible people who possess what people in the technology world call ‘soft skills’, but I hate the term. Soft skills are core skills. I don’t really care about a technology background. Technology can be learned.

“Things that can’t be learned are core skills like empathy, which is critical to understanding who the customer is, what they want, what makes them tick, why you are building something. ‘Is this something that a customer truly wants?’ ‘How does it make the customer feel?’

“Those are questions that get a little lost sometimes. Sometimes product teams outsource these questions to designers, creating silos. Product managers worry about this stuff, and the technical people worry about other things. I just don’t buy in to that. I feel that it is everyone’s role to understand why they are building what they are building and to remember that there is a real person using this thing.”