When I first started using Xero, I came from a background rooted in large ERPs like NetSuite and the complex financial systems of big listed companies, which I’d worked with during my time at PwC. My introduction to Xero happened when I joined RORA (previously Quantico), where I was working with seed to Series A businesses. Switching from those big ERP systems to Xero’s ecosystem was a big adjustment for me.
At Arbolus, we rely on Xero to manage our global financial operations. This was actually a key part of the conversation during my hiring process. The company was clear that they needed a finance leader who understood the importance of automation and tech stacks. My familiarity with Xero and its ecosystem ended up being a big factor in landing the role, as Arbolus needed someone who could work creatively with the ecosystem to ensure scalability and efficiency.
From ERP to Xero: Adapting to an ecosystem model
Coming from an ERP-heavy background, I initially had some doubts about whether Xero could really meet the needs of a fast-growing business. With larger ERP systems, everything tends to be centralised—your accounting, reporting, and even workflow automations are all housed in one place. Xero, on the other hand, acts as the hub of an ecosystem, meaning you often need to integrate multiple apps to get the full range of functionality needed to support a scaling business.
At first, this ecosystem approach felt a bit overwhelming as there were a lot of different systems to juggle. But once I got more familiar with Xero’s ecosystem and the power of its integrations, my concerns started to ease. While a centralised ERP has its perks, especially in terms of native functionalities, Xero really shines in its flexibility and the wide range of tools available through its ecosystem.
That said, the transition wasn’t without its challenges. I had concerns about Xero’s handling of detailed financial data, particularly when it came to automating things like prepayments and managing granularity like tracking categories. There’s definitely more potential for human error here. But with the right processes in place—whether it’s additional reviews, team training, or using third-party apps that specialise in these areas—those challenges are manageable.
Using Xero’s ecosystem to tackle our pain points
Setting up consolidated management accounts was one of the first hurdles we faced at Arbolus. Before I joined, the system we had in place wasn’t the most reliable. Thankfully, with Joiin—the multi-entity consolidation software that integrates with Xero—we were able to overhaul our monthly reporting and produce much more accurate, streamlined financial data.
Managing a multi-entity setup on Xero is not without its challenges. Intercompany recharges, for instance, initially would take us over half a day each month—plus extra time for any adjustments. Luckily, we discovered Mayday, which automated the entire process. I would say that it is very important to stay disciplined with your accounting system, especially when using Xero in a multi-entity setup. Consistency with things like the chart of accounts and a disciplined approach to data entry are crucial to avoid mistakes that could snowball as the business scales.
Another challenge came with the sheer volume of transactions we needed to process. For example, once we started self-billing for our experts, the number of bill transactions skyrocketed. I was initially concerned about whether Xero could handle that kind of volume, especially since it has published guidelines around the transaction limits. But despite pushing those limits, Xero has been surprisingly robust, managing thousands of transactions a month. Hearing from others about how far they’ve been able to take those limits (for instance in this CFO Techstack article), gives me more confidence in its ability to scale with us.
Another hurdle we encountered was managing mass payouts to our experts, this required some creative problem-solving. Initially, these payments were being processed manually, which quickly became unsustainable as we grew. We originally implemented Trolley which worked well for a number of years and helped streamline the process. This year we migrated to Tipalti to ensure continued scalability.
Staying agile in a fast-paced world
What I’ve really come to appreciate about Xero is the quality of the specialised apps in its ecosystem. In my experience, some ERP systems bundle features like OCR for invoice scanning or bank reconciliation modules, but they often don’t perform as well as dedicated solutions. In contrast, apps like Spendesk for spend management or Dext for document processing tend to outperform the built-in modules of larger ERPs. These “best-in-class” tools, combined with Xero’s flexibility, create a powerful, tailored solution for a business’s specific needs.
That said, not every app in the ecosystem is of the same quality, and one challenge is finding providers who are constantly innovating. Sometimes, well-established apps can become complacent over time, with product updates becoming less frequent and missing out on the latest technological advancements. We’ve had to switch apps a few times for example when we outgrow them or when they weren’t ultimately a good fit for our business, which can feel disruptive, but staying agile and open to change is crucial to getting the most out of Xero’s ecosystem. It's tempting to stick with what's familiar (change can be scary!), but in a fast-evolving tech landscape, staying ahead requires adaptability—sometimes switching providers entirely.
Looking ahead
I’m confident that Xero will continue to support our growth for some time. Our business model, which involves high-value, lower-volume invoicing, aligns well with what Xero and its ecosystem offer. That said, I’m mindful that we may eventually outgrow the system, and when that day comes, I’d rather be proactive than reactive. Migrating to a more complex system when the volume of data is still manageable would be far easier than waiting until it’s overwhelming.
But for now, I’m optimistic that Xero will meet our needs. It’s true that some external factors—like investor requirements or the complexity of our entity structure—might prompt a switch to a larger ERP before absolutely necessary. But with strong processes and organisational discipline in place, Xero remains a great tool for managing our finances as we scale.
My advice to fellow finance pros
For finance leaders in a growing business, my advice is simple: connect with others in your position who are also using Xero. There's a lot of valuable knowledge out there from companies that have faced similar scaling challenges. Often, getting advice from someone familiar with the Xero ecosystem can be much more cost-effective than jumping straight into an ERP.
Carefully designing your tech stack and putting solid processes in place from the start will save you time, money, and a lot of frustration later on. And as your business grows, think about bringing in a financial operations specialist to keep your stack strong, scalable, and secure.
In the end, while Xero might not be the best fit for every business, for companies like Arbolus, it provides the agility, flexibility, and integration potential we need to scale effectively—for the foreseeable future at least.
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