Accounting software giant Xero has announced its acquisition of South African cloud-based reporting platform Syft for $70 million. The deal is expected to close by the end of 2024, subject to regulatory approval.
Founded in 2016, Syft offers AI-powered financial reporting tools to small and medium-sized businesses worldwide. With a customer base of 75,000 across 80 countries, the company generated $4.4 million in revenue in 2023.
Xero will pay $40 million upfront, including $10 million in shares. The remaining amount will be paid over three years in earn-outs and employee-restricted shares. Syft’s 70 employees will join Xero’s team.
Syft CEO Vangelis Kyriazis expressed excitement about the acquisition, stating that joining Xero was a natural fit given the companies’ shared mission of helping small businesses succeed.
This acquisition aligns with a broader trend of global tech giants acquiring South African SaaS startups. In March 2024, Deel, a US-based payroll provider, acquired PaySpace, a South African payroll startup.
Syft will continue to operate as a standalone offering while its functionality, including visualizations, analytics, and reporting capabilities, will be integrated into Xero’s platform. This will enhance Xero’s insights and reporting capabilities in key markets such as Australia, the UK, the US, and others.
The acquisition of Syft is a strategic move for Xero, as it strengthens the company’s position in the global accounting software market. By combining Syft’s advanced reporting capabilities with Xero’s core accounting functionality, Xero can offer its customers a more comprehensive and valuable solution.
