I came across the Bronte blog last week, after seeing Hempton's...

I came across the Bronte blog last week, after seeing Hempton's comments in the news about XRO potentially being worth $100B. I think he's spot on. When he envisages XRO as being the 'backbone' of the accounting world, I imagine he's thinking of XRO becoming to the accounting world something akin to what Microsoft has been to PC's.

As an avid PC user in the 90's, I distinctly remembering no one having a real choice of operating systems on the PC. This was because all the best software was written for the Windows operating system. Competing operating systems couldn't attract customers due to the lack of software available for their product, and software makers stopped making software for OS's with no customers.

Today, I look at Xero and see its market leading position in terms of the number of external software written for XRO. I can't help but think that this could do a Microsoft in the future. The current CEO being a former Microsoft executive also increases the probability of this scenario playing out, I think.

I'm looking to take a position in XRO during the next dip, which I think is likely to occur as I think its high earnings multiple makes it susceptible to a pull back.  In any case, I know it's a much better bet than some other tech darlings, like Afterpay. At least with XRO, I know for a fact that customers are sticky and loyal to Xero's particular offering. With Afterpay, the customers are loyal only to the generic service of a digital layby company. There's nothing to stop Afterpay customers from switching to rival digital layby services if they are offered appropriate inducements. However, the same cannot be said for Xero.

Just my 2c.