Xero: The ideal online accounting solution for startups/SMBs?

When going through Jakob Nielsen’s list of the 10 Best Application UIs of 2008 [1], I’ve noticed there’s also an online(!) accounting(!) system for SMBs among the winners:

Xero – The world’s easiest accounting system.

This is a big surprise, as I’ve already tested quite many accounting systems for SMBs/SMEs, both standalone and web applications, but none of them was particularly easy to use. The point isn’t that I couldn’t use a complex accounting system [2], the point is that I don’t want to if it isn’t necessary. In other words, every hour I can save on accounting and invoicing, I can spend on business development and software development. Which obviously makes sense.

Considering this, the price of 49 NZD (34 USD) per month for Xero is a fair deal. The only thing that isn’t customer-friendly at all, is that they decided to go with an opt-out free trial model (i.e. if you don’t cancel the trial within 30 days, you’ll be charged). Definitely worth a try, though.

[UPDATE 20080813: Note that Xero is not available for purchase in Switzerland yet (hopefully soon). You can still try the demo though.]

[UPDATE 20080814: I've quickly tested Xero. Conclusion so far: I like it a lot! It delivers, what most startup companies need in regard to accounting and it makes things as easy as possible. In fact, I've never seen a more intuitive accounting system before! It will definitely set the new benchmark in its class. Let's hope there will be a Swiss edition soon. Kudos to the makers of Xero in NZ: You rock!]

[UPDATE 20080815: Xero's plans are to have a global version of Xero ready by early 2009, see my follow-up blog post]

[1] Also noteworthy: CMSBox, a very user-friendly CMS made in Switzerland.

[2] Among others, two of my majors at the University of Zurich were Management Accounting and Managerial Accounting.

[3] Of course, you could also outsource all your accounting duties, but particularly for a new startup with a minimal headcount, the outsourcing efforts generally outweigh the benefits.