Some of Xero's first employees have left to create the country's next big tech export

Atomic CEO Darryl Gray.

Darryl Gray was employee number five at cloud accounting software company Xero. He joined about a month after it was launched in 2006 and worked overtime as a designer and marketer in a space which he estimates was about 20 square metres.

Reminiscing on his old job, he said even in the early days, Xero was growing quickly — it was a job he took on to learn how to launch a company which could travel on a fast and steep growth trajectory.

“It was so first hand. I was there for the first two years and had the opportunity to build the brand of Xero out and start when it was just a few people and really fun,” Gray told Business Insider, adding working at a company that was running an IPO when it had almost no revenue and no customers was “kind of crazy”.

He describes Rod Drury, Xero CEO, as a “business genius” who sees business as a “fun game to play”.

“He was that classically intense entrepreneur who was 100% all the time,” he said. “There was so much to learn.”

The references at that time were sites like Flickr, there was no sense of what today’s powerhouses like Facebook, Twitter or Google were doing back then.

“We were trying things out and were still convincing people that the cloud was ok. That debate’s over,” Gray said, adding now he’s launching his own venture he appreciates “how hard it is to tell those stories in the public.”

“The Xero story now feels like one success after the other but being there I know it was always destined to be successful because of that attitude that we’re pouring everything into this but there was no clear line.”

The key thing Gray took away from his time at Xero was learning to be comfortable with experimentation, and if a strategy doesn’t work, moving on quickly. “Throw things against the wall and eventually something will stick,” he said.

For the past 18 months Gray has been building his design platform startup Atomic. Two of the three Atomic co-founders were original Xero employees. Atomic CTO Vim Jobanputra also worked at the accounting company in the early days, while head of product Grant Robinson worked with Gray in a previous job.

Gray said one of the big things propelling original employees like him and Jobanputra to go out on their own was the growth in Xero’s share price, which gave them some capital to play with.

“Those original people were attracted to a really risky idea and I don’t think you lose that,” he said, adding it’s now his turn, something Drury actively encouraged within the Xero ranks.

“He always said to us, ‘this should be your second-to-last job’,” he said.

Design has been a market sewn up by Adobe Photoshop for years. But recently richer prototyping tools like Invision have started to emerge. At the same time, many of the new design tools focus on small parts of the process rather than offering an end-to-end solution, which Atomic is looking to do.

The Atomic platform, launched last week after being in private beta for the past 6 months, includes drawing, prototyping, collaboration and version control tools.

“The industry can’t afford to be fragmented anymore,” Gray said. “No matter which way you cut it, within five years there are tens of millions of people with huge amounts of market cap riding on the decisions that are made in tools like this.”

The startup has raised almost $NZ2 million in funding over two rounds, and, like Xero, Gray said it’s a capital intensive business.

“We don’t have any current plans to be turning a profit, our goal is to just dig as deep as we can,” he said.

“Two years from now we’re not going to be talking about what the tool’s going to be, it’s either going to be Atomic or someone else.

“We still feel like we’re five or 10 years off really hitting scale.

“The next phase of the business is building out the depth in each of those function areas.”

Gray said the startup had been approached by a number of investors and the founders are heading over to the US shortly to have a couple of conversations about funding.

Part of the next round would be used to boost staffing levels from the current 11 to closer to 100 — Gray isn’t mucking around.

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