Odoo’s new round with Summit Partners means all this was just a beginning
By: Cyril Bertrand
Odoo is raising a stunning new round with Summit Partners, the first since the 2014 Series A lead by XAnge. What a ride! In just a few years, the Belgian startup has become one of the sexiest ventures in the Saas world. We couldn’t be prouder to open this new chapter with Summit Partners, and we will remain as involved (and excited) as we were since day 1.
Like us, you should follow Odoo very closely. Here’s why:
State-of-the art ERP, for all
Odoo offers small business the ERP they wouldn’t have dared to ask for in their wildest dreams.
An ERP is the modern business management software of any company. It allows teams to manage inventory, accounting, CRM & project management all together, in coherence with one another. ERPs like SAP and Netsuite are vital to large companies, but ERPs in general have become vital to small businesses too.
The problem is that equipping small businesses with state-of-the-art ERP is like complex. It demands perfect articulation between production, supply chain, orders and finances. Only the best solutions do it well. Netsuite (Oracle) does it. Odoo does it better, simpler and cheaper too.
Until Odoo appeared on the market, most businesses were reluctant to use an ERP because of the quality of their databases. Migrating them into the tool could be so painful that the migration caused more harm than good. That’s where Odoo’s genius came in : its offer is so simple that it can be used as Saas. The migration is supported by a mix of powerful tech tools and expert integration partners.
Open source = global by design
As an open source software, Odoo relies on a community of independent integrators and developers to spread and evolve. This same community plays the role of developers, and therefore of software contributors. Anywhere a business needs an ERP, it will find local experts from the open source community that can adapt Odoo’s generic modules to its specs. There are thousands of them around the world.
Just like that, Odoo became the preferred solution for small businesses in over 45 countries. No need to “open” new markets: it is global by design. From our perspective, the way Fabien leveraged the power of open source to generate organic growth is simply stunning, and totally unique in the world of B2B Saas.
Made it in America!
Odoo makes a third of its business in the US. Benchmark that against most of European software companies and you’ll realize this is already a strong achievement. Then add that Odoo’s US operations are profitable and you’re sitting in front an exceptional execution.
There’s no one quite like Fabien
“I want to be surrounded only by people with the highest qualities — which also means they tend to have serious flaws. My job is to make them work together.”
Fabien owns over 50% of his company. He’s the only founder in our portfolio to be in his position, and it’s easy to see why: for a VC this equates to giving the man a carte blanche, and full autonomy on the destiny of the venture.
The last (and only) time I agreed to such a deal was with the founders of Chauffeur Privé, now Kapten and owned by Daimler Chrysler.
There’s probably a lesson for us here.
Coders delight ❤
Fabien launched Tiny ERP out of University, which then became OpenERP and eventually Odoo as we know it. Back then, he was the only coder of the company. He’s now one of 150 — not 150 employees, 150 developers. There is a broadly accepted rule of thumb that tech teams become ‘less efficient’ above 80. Well — yet another universal truth does not seem to apply to Odoo.
Fabien recently dived-in and rewrote one of Odoo’s modules, which was too slow but considered untouchable by the dev community. It’s his thing. For us investors, this can be scary — the CEO of a 800 employee company going back to coding for a few weeks .. but it’s the Odoo way and we’ve learned to not only accept it, but observe and — sometimes — learn from it.
The culture is unique
Thankfully, Fabien is surrounded by the best devs you can find. How does he attract and keep them? He’s one of them.
In 2017 the startup published the salary grids of its tech teams. Everybody knows how much a department makes on average, and applicants for a job can predict their wage on the company’s website. A tech guy can change jobs at any moment and keep his salary. This says a lot about the mentality at Odoo. It’s your contribution to the project that matters, not the position.
This transparency initiative also had impact outside the startup’s walls: it set the standard for the entire western European software industry. If you’re a headhunter, a recruiter or a manager somewhere and you need to recruit, you better double check your offer corresponds to the standards.
With transparency also comes autonomy. Within the total compensation package, Odoo gives its employee maximal freedom on how they want to get paid, depending on their life priorities. Is it a car you need? A family insurance package? Maybe just more cash? The choice is yours. Just like that, the startup ensures it is as appealing for 20 the year-olds as it is for the senior developers.
Full thrust, full trust
Now, we’re selling a portion of our stake in Odoo to Summit Partners. For most startup management teams, this is “re-risking” time! It’s very common if not automatic: founders and managers that hustled for years will sell a reasonable fraction of their stakes and grab a chunk of the beautiful value they created for their investors.
Not Fabien and his team. They’re not selling. Actually they’re raising their stake in Odoo. And they even borrowed money from the bank to do so!
It’s not enough for them to sit on top of the cap table: they want more. Where most of us see rest & fortune (and rightfully so), they see leverage and trajectory. Their confidence is mindblowing. It is also very justified.
Summit is stepping in
Fabien has a thing for product-obsessed investors.
It was Xavier Niel and Sofinnova Partners at seed stage. We joined-in 2014 for Series A. The business never stopped expanding — it is now more than 10x what it was in 2014 — and stayed profitable all along. Because the startup never needed money (and because Fabien is so averse to dilution), Series B never happened.
It is now time for Summit Partners to step-in. They are the perfect partner for Odoo, and we couldn’t be prouder of this deal. There is still a lot to build. Remember how we mentioned Netsuite earlier? It’s a 10+ billion dollar business. Odoo is on this kind of trajectory, and there is no way Fabien will stop until he gets there.
