Executive Success: Accountant with global goals

Even when you're retired, you can't relax and play golf every day, says Hamish Edwards. Photo / Supplied

Co-founder of Xero is putting its tools to work in his latest business venture

Unfinished business has kept Xero co-founder Hamish Edwards from slipping into complete retirement.

The 42-year-old accountant says Xero is to blame for taking him off on a tangent, away from his plan to create the ultimate accounting firm.

It's been several years since he had any involvement with the company, though he still has a small shareholding, but he believes Xero is the missing technology piece he needs to turn the accounting services model on its head.

"I had to take seven years out and build the software so that I could go back to doing what I wanted to."

That vision is realised in RightWay, an advisory firm with global ambitions that he created several years ago with Wairarapa-based accountants Greg Sheehan, David Shaw and Edwin Read.

The firm is focused on small-to-medium-sized businesses. Those firms need advice and help, but traditionally the majority of the fee spent on an accountant goes on doing a tax return, says Edwards.

"I started out as a young accountant in BDO years and years and years ago and learned how to do tax returns probably inside six to eight months.

"Yes, there's other complicated things in tax and tax is a lot more complicated than it used to be and that's fine but to be completely frank, it's not that hard to get a tax return done and get their annual reports done and all those sorts of things.

You don't need someone with 25 years' experience to knock out a tax return.

Hamish Edwards, RightWay

Xero is used to minimise the time spent on number-crunching, freeing up RightWay practitioners to work like a virtual CFO on growing client businesses.

"Every entrepreneur needs a great CFO - just ask Rod Drury, he knows all about that," laughs Edwards.

RightWay is hiring chartered accountants, who are paid a base salary and commissions, backed up with operational support from RightWay's head office.

"The key thing for us is finding the best possible people so our HR strategy is, in my opinion, the most important part of our business." Edwards says great people who are "sick and tired" of working in traditional accounting firms are coming out of the woodwork, and RightWay already has four lined up in Sydney, despite having only just touched down in the Australian market.

"Basically what we're going to do is, we're just going to rip around the world and find all these great young guys and girls that want to help people and support them to do that.

"We've got the model so we know how to do it; we're going to get better and better at it and we're going to build better and more improved systems as we go along, as you would with any business, and the only other big issue we've got is capital raising." Edwards says the team has realised it wants to go faster, and doing that needs an injection of several million dollars, hard on the heels of a recent successful capital raising.

Looking back, he says one of the mistakes made at Xero was not going fast enough. And he admits that sounds weird to anyone looking in from the outside at a business that seemed to explode out of nowhere to become a leading listed company.

But Edwards says, with the benefit of hindsight, Xero should have put more sales staff on the road earlier to get out and meet local accountants, not once but several times over, to establish a relationship of trust.

"We were trying to play catch-up football in the end trying to get round them all." Wisdom gleaned from growing Xero is being put into use powering up the next tranche of companies, like RightWay, but Edwards says it's not his style to invest in a start-up run by a bunch of guys he doesn't know.

Drury was originally a client of Openside, the accounting firm Edwards ran with his father, when the pair laid the foundations for Xero.

Edwards has invested in Atomic, a software firm created by a colleague from Xero days. He also chairs Trustworks, a cloud-based software company streamlining the management of trusts, based on an idea he cooked up while riding a chairlift with university mate and lawyer Andrew Finch.

It's run by school friend Jeremy Buckley. Finch also works alongside him on the Ski Racing NZ charitable trust, a venture the pair established to support elite ski racers.

Edwards says he has no interest in going back to working 80-hour weeks, preferring to gather the right people around an idea.

His claims of giving up work are backed by 76 days of skiing and 56 rounds of golf last year, plus his ability to be at home after school for his three children.

"I am completely retired. I only do this stuff because it interests me.

"Occasionally it rains and you can't play golf so you might as well do something with your time, and helping friends out who have got businesses that you're involved in is just a lot of fun and it's something I've had some success with in the past and feel reasonably confident to provide some thoughts and advice to people in terms of what they should do and work with them.

"I don't think I'll ever stop doing it; I'll always be involved in business in some way."