The archive · Developer & Business Tools · Strategic decision · 2002–2024
Odoo bootstraps open-source ERP to €5B valuation, still cash profitable
Belgium's Odoo bet affordable open-source ERP could win SMEs from SAP; two decades bootstrapped, cash profitable, €5B valuation on a 2024 secondary.
Odoo
What the business is
Odoo sells an open-source suite of 80+ integrated business apps (accounting, CRM, inventory, e-commerce, HR) to small and mid-size companies, monetizing through paid Enterprise subscriptions on top of a free community version.
How it started
Fabien Pinckaers founded Odoo (originally OpenERP) in April 2002 from a farm in Belgium that was all he could afford, betting that open-source software could crack the ERP market that SAP and Oracle served mainly at large-company prices.
What happened
Odoo grew into 80+ integrated apps plus an app store of 50,000+ community applications, with revenue and customers growing about 50% a year for a decade. It raised little and early — its last primary capital was a $10M Series B in 2014 — and stayed cash profitable. In November 2024, CapitalG and Sequoia led a €500M mostly-secondary transaction at a €5B valuation, letting early investors and employees sell shares while the company took no primary capital.
How it ended up
Still private, profitable and expanding: on track for €650M+ billings in 2025 with a stated ambition of €1B by 2027; Pinckaers has never sold his own shares and says there is no rush to IPO.
Background
Odoo, founded by Fabien Pinckaers in April 2002 on a Belgian farm, sells an open-source enterprise resource planning suite — 80+ integrated apps covering accounting, CRM, inventory, e-commerce and HR — to small and mid-size businesses. Its bet was that the open-source model could undercut SAP and Oracle in a market those giants served only at enterprise prices.
For two decades Odoo grew on that formula: a free community edition as the wedge, paid Enterprise subscriptions as the revenue, and an app store of 50,000+ community applications as the ecosystem. Revenue and customers grew around 50% a year, and the company stayed cash profitable with only early, small rounds — its last primary capital was a $10M Series B in 2014.
By 2023 billings reached €370M, and in November 2024 CapitalG and Sequoia led a €500M mostly-secondary transaction valuing the company at €5B — investors and employees sold shares, the company raised no new primary capital, and Pinckaers kept his own stake. Odoo was on track to top €650M in billings in 2025, aiming for €1B by 2027, with no hurry to IPO.
What has to be true
- It attacked the biggest enterprise-software incumbent with the opposite motion: give the product away, then charge only for upgrades — a wedge SAP's sales model couldn't copy cheaply.
- The profitability was public and repeated: cash profitable with ~50% annual growth and €370M billings, so the €5B valuation rested on revenue, not a funding story.
- The secondary structure proved the model: investors cashed out at €5B while the company took no primary capital, keeping independence intact.
- A two-decade horizon let Odoo build breadth (80+ apps, 50k+ community apps) that a venture-burn sprint would have made impossible.
What can be applied
The wedge matters more than the war: Odoo didn't out-feature SAP; it gave SMEs a genuinely free, simple ERP and monetized upgrades, funding 20 years of independent, profitable growth.
Aftermath
As of November 2024, Odoo remained private and cash profitable with 5M+ users, €370M billings in 2023, and projections of €650M+ billings in 2025 and €1B by 2027. The €500M secondary led by CapitalG and Sequoia (with BlackRock, Mubadala, HarbourVest and others) valued it at €5B; Summit Partners stayed its largest institutional shareholder and Pinckaers retained his personal stake. The company said proceeds would go to R&D and product acceleration, particularly around AI, with no IPO timeline.
Sources
- Alphabet's VC arm backs little-known SAP rival Odoo, boosting valuation to $5.3 billion
- Riding high on open source ERP, Odoo raises $527M via secondaries, lifting its valuation to $5.26B
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