Xero has topped Forbes' Most Innovative Growth Companies list for a second year running.

The list ranks companies by what what Forbes calls their "innovation premium" - the proportion of a company's market value that cannot be accounted for from the net present value of cash flows of its current products in its current markets.

Xero topped the list with an innovation premium of 90.1 per cent, a shred above American software company NetSuite, which came in at number two with 90 per cent.

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Xero chief executive Rod Drury said the list placing was great profiling and validation for the company as he worked to build Xero's global brand.

"I think, if you look at the growth rates now you're seeing the quality of the Xero business globally.

"I know that we're kind of seen as a bit odd in New Zealand because we've grown so fast and we're investing so much to do that, but those results now are quite clear to people overseas.

"Our sheer growth rates over the last five years is so much higher than some of the well-established brands that people talk about in the technology space."

Drury said he believed Xero could maintain its growth rates due to the size of its addressable market.

"Way less than one per cent of the entire small business software market has online accounting software, so that's what's so exciting about Xero, it's still so early."

Only industries that are known to invest in innovation are included in the Forbes list - banks are excluded, as are energy and mining firms, "whose market value is tied more to commodity prices than it is to innovation," Forbes says.

Also featured in the list was UK-based retailing giant Asos (#4) and Austraslian job listing site Seek (#14).

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The full list can be seen here.