Dropbox is now working with Xero to build up its paid subscriber base

Dropbox Australia MD Charlie Wood. Image: Supplied.

US-based cloud storage company Dropbox and Xero have partnered to develop products to better serve small businesses, the cloud-accounting company’s bread and butter market.

The strategic partnership means Xero and Dropbox will collaborate to integrate both companies’ products. It will include a number of workflow enhancements such as enabling Xero users to access Dropbox files from within its platform.

“Our partnership with Dropbox is another big step in our efforts to demonstrate continuing innovation and support for small businesses,” Xero Australia MD Chris Ridd said.

Just last month Xero struck a similar agreement with Google so users could create invoices from within Gmail.

Xero Australia Managing Director Chris Ridd.

Teaming up with big tech players is one strategy Xero is using to boost its customer numbers. Earlier this month the cloud-accounting firm hit 500,000 global subscribers, of which just over 200,000 are based in Australia. Integrating with commonly-used solutions is important as it gears up to take market share from competitors like the newly listed MYOB, Reckon and Intuit. It is also in the middle of building out its US market base.

Dropbox is on a mission to convert some of its 8 million Australian users from its free service onto its paid business product. Founded back in 2007, Dropbox has more than 400 million registered users globally, of which about 100,000 are paying business customers.

But it is reportedly battling an internal struggle to build a more stable business model and revenue stream. Deals like this one with Xero could be one way to mount the conversion of free users to paid customers.

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