TCV invests $20m in New Zealand's Xero, Martix part exits

According to a filing, the off-market share transfer will reduce Matrix’s stake in the company from 9.8% to 8.5% and result in TCV taking about a 1.3% holding. Xero stock has traded steadily since the announcement and was at NZ$20.50 as of mid-morning April 20, giving the company a market capitalization of around NZ$2.8 billion.

Matrix invested NZ$147.2 million in Xero alongside Accel Partners in 2015 as part of an R&D push and expansion effort into the US and UK. It backed a NZ$180 million round in 2013 and NZ$60 million round 2012 with US-based VC Valar Ventures, a firm backed by PayPal and Facebook co-founder Peter Thiel.

Xero, which trades on both the Australian and New Zealand bourses, was founded is 2006 and focuses on cloud-based accounting software that is accessible via a standard browser. The platform lets users create invoices, pay bills and wages, reconcile bank accounts and numerous other functions needed to run a small business.

Operating and subscription revenue both improved 67% year-on-year during financial 2016 to about NZ$207 million and $202 million, respectively. The company recorded a net loss of NZ$82.4 million during the year, compared to a loss of NZ$69.5 million in 2015.

TCV claims to have raised $12 billion and invested some $9 billion in more than 200 technology companies since 1995. It has previously been active in Australasia with participation in a $30 million round for SiteMinder, a Sydney-based company that provides cloud-based distribution products for the hospitality industry - including a booking engine and connectivity tools.

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