Fabien Pinckaers, CEO @Odoo: The Billionaire Founder Who Doesn’t Care About Money | E1259

Fabien, I am so excited for this. I am a SaaS nerd, and Odoo is one of the most incredible stories. Thank you so much for joining me today.

Thank you for having me.

I would love to start with the fact that you started your first business at 13 with a business-management software company. What is the story there?

I was a developer, and I also liked management. I was reading a lot of books. It was just friends of my father and me doing management software for them. I started with 1 customer, then 2, and then a lot of people.

You started with 1, then 2, then a lot of people. Were you aware that you were building a business and that you wanted to make money at the time? How were you thinking about it?

It was not so much about getting money. It was more about building something. What I like is building software that people use and that has an impact on them. The money was great, but it was €150 at the time, so it was really just about doing something.

What happens next? You are in school, 15 or 16 years old. Were you the smartest kid in school, with school being easy?

I did not go to the lectures. I was more focused on doing business, having fun, and drinking beers. But I continued developing software for companies during university. I did a lot of things, including e-commerce, antivirus software, games, and a T-shirt company.

You had a T-shirt company? What was that about?

I am passionate about open source, Linux, and that kind of thing. I created an e-commerce business selling Linux T-shirts, ties, Debian, and everything related to it. I sold a lot, but it was really painful to post all those T-shirts every day. It became a logistics challenge for a student who wanted to drink beer. It was not great.

You realized the challenges of actually selling physical products.

What would you say was your first real business?

I think the first real business was the art marketplace.

That was a big one. You outsold eBay?

Yes, I was selling more objects than eBay Belgium—around 15,000 artworks per month at the time. I was working with auction houses, antique dealers, and art galleries. I actually became one of the biggest in Belgium.

Was it making much money?

Not so much. The business model was bad. I was making something like €5,000 per month, which was great for me as a student, but for what I had built, it was nothing.

We have that, and then Odoo. How does Odoo come about?

I am passionate about development, of course, and management. Odoo was a way for me to put all my passions together in a single piece of software. I had all these different activities—T-shirts, the art marketplace, antivirus software, and everything else—and at some point I said, “I will stop everything and focus on the one thing I really like, which is building management software.”

That is what I did with Odoo. I started small with the auction houses, which had been my customers for e-commerce websites.

What was your first product?

My first product with Odoo was the opposite of the traditional approach. Usually, you start with an MVP—a small product. I did the complete opposite. I started with everything: accounting, logistics, purchasing, and all the other functions at once. It took 2 years to build the first version of the product.

Was that the right decision? We are trained in MVPs and the Lean Startup. My team calls what you did the “fat startup,” which is doing it all first.

I remember an article by Paul Graham at the time. He said that if you want to have a big impact and build a big company, you have to fix a big problem. I had that story in mind. I wanted to do something very complex, and doing everything companies need is a big problem. I started to tackle that challenge.

Do you worry that by doing everything, you lose focus?

Yes, it was very risky because it took time to monetize and get to something I could sell. But now that I look back, it is probably what made Odoo what it is today. I thought about the big picture, with everything working smoothly together. It is not a patchwork of different software.

How do you have feature parity? How are the products as good as the single-point solutions when there are 50 of them?

Initially, I started as a service company. I built whatever customers asked for, so I built features, features, and more features.

Which is what we are told not to do.

Yes, but I bootstrapped the company. When you bootstrap a company, you need money, and my way of getting money was to sell services and development. It is not a good business model, but I grew the company to 100 people on that basis. It worked, but I struggled a lot. For a few years, we were close to bankruptcy.

You scaled to 100 people with a professional-services, hands-on approach, and during that time you said bankruptcy loomed. Take me to one of those moments. What happened?

It is not that there was 1 specific moment. When you are close to bankruptcy, it lasts for months and months. You do not sleep, you work much harder, and you take customers simply because they pay faster, not because it is a good deal. You make bad trade-offs.

Because I was the main shareholder and remained so, I did not need to raise money at the time.

Why did you not raise money initially?

I was not thinking about it. I was building the business, growing the company, and focusing on that. I wanted to keep the majority of the shares. In 2010, I had to pivot the business model. I wanted to stop the services activities and refocus as a software vendor. That is when I raised my first round.

In 2010, you wanted to focus on software and be less focused on services. Talk to me about that decision and how you came to it.

That is what I wanted to do from the beginning, but we reached a point where the software was very complete and had a terrible user interface. I was not happy with it, and I thought it was time to refocus, invest in R&D, and build a software model with recurring revenues.

I decided to stop all my services activities from 1 day to the next. To fund that, I needed to raise my first round.

How much did you raise in that round?

€3 million.

How did it go? This was your first round.

Very well, actually. As a Belgian company, there are not many big VCs in Belgium, so you basically go to Paris, London, and Germany and meet all of them. The investment community was not that large, and I got around 10 offers, which was quite good. I picked the best one.

Who did you pick?

Sofinnova Partners, which led the round.

What was the price?

€7 million pre-money, so €10 million post-money.

That is 30% of the company.

Yes. That was not a good valuation.

A good deal for them, though. You raised that money and replaced the services side of the business. Now you could focus on the user interface. What happens next?

Odoo is open source, so even though I had started a software-vendor model, we were still open source. What we were selling was maintenance, software support, bug fixes, and similar services—essentially, maintenance contracts.

We stopped our service activities and built a partner network all around the world. It worked well, but most customers paid for the first year and then told us, “The software is good. I do not need maintenance anymore.” The business model was not great because the product was open source. They could continue using the software without paying me.

What do you do now? That is a problem.

After 2 years, I was close to having zero money in the bank account again. I had to do another pivot in the business model. This time, I switched to an open-core business model, where 80% of the features are open source and 20% are paid.

How did that go? Did we have much money at this point?

No, I was close to zero. I think I had something like 2 weeks left.

Were you sleeping?

Not that much. When you have problems, there is pressure from the board, issues with the business, and everything comes together when you do not have money. It is very hard. But we made it, so it is okay.

You are doing open core, with 20% of the features paid. What happens then?

Then everything gets really good. During all those years, Odoo built a software product and a community. We had a big software product and a big community, but no revenues or limited revenues. Once we started to monetize efficiently, everything went very smoothly.

It was different because we used to fight to survive. That was our main motivation: survival and optimizing everything because we had no cash. Then, from 1 year to the next, we had a lot of cash, the business model worked, and we had no more cash issues. We had to find our motivation elsewhere.

I love that. Open core starts going really well. What sort of revenues are we at now?

Something like €15–50 million.

What happens then? Do we just progress with open core and continue to scale?

Yes, that is the business model we still have today. We grew on top of that. If you look at the past 20 years, we basically grew at 50% per year, year after year. There was not a big bang. Odoo has just had continuous growth year after year.

With that growth, there are always challenges with culture and scaling teams. What were the first things that broke?

One of the big issues I had at the time was that I deceived the community. I built the community with an open-source mindset: “We are open source, we will always be open source, proprietary software is bad, and we are not like that.”

I fought to keep that open-source business model to the point where we were close to bankruptcy. When I switched to open core, it started a big fight with the community. They were disappointed because we had built them on a different story.

The marketing was very bad. A lot of people criticized us, and many partners left to find competitors. But the product was good, so the majority of them stayed with the product. Looking back, if I had pitched it correctly—“We are open source today, but maybe in the future we will need to monetize”—I would not have had that many issues.

Do you think a great product wins?

I am sure about that. We have had difficulties, but the thing that kept us going was the product.

Why, then, are we told to focus on distribution, marketing, and brand? If a great product always won, the world would look very different.

Great products do not always win. You can save 2 or 3 years with marketing, and you can grow the company faster, but at some point you cannot avoid the importance of the product.

I am in a market that is very slow. ERP systems are very slow. SAP is still terrible after 20 years, and Microsoft Dynamics is also in a slow market. In that market, the best product wins.

What product decision did you make that, with the benefit of hindsight, you wish you had not made?

The worst decision I made—and some of the best decisions—was around pricing. I made a very bad pricing change. When you have difficulties, you try to change everything: the product, the business model, the services you sell, and the pricing.

At the time, we were changing the pricing every year. We were experimenting, and one of the worst decisions I made was one of those price changes. We probably lost 1 year of growth because, when you work with partners, if something does not work, it takes time to rebuild trust.

What was wrong with the pricing?

Odoo is a suite of business applications: CRM, e-commerce, accounting, and many other products. I wanted to have a price that grew with the value of the software—the more users you have, the higher the price, as usual. But I also wanted the price to increase with the number of applications you used.

I created a price that was €10 multiplied by the number of users and multiplied by the number of applications. It was growing very aggressively, and it was too high. The partners did not like it and pushed back hard. They refused to sell it, so it became very difficult.

When you have a partner network and change the price, the partners always react. You never know whether the price is wrong or whether it is simply the transition and resistance to change. For a few months, we tried to convince them that the price was good and aligned with the value. It took us around 9 months to go back to the old price, so it was very hard for the company.

It is incredibly challenging to work with partner networks and pricing. You also did a pricing change in 2022, and the numbers after the change were up and to the right. Why was that such a good decision, with the benefit of hindsight?

This price change decreased the price for small customers and increased it for larger customers. For small customers, we were too expensive across all applications. It was around €120 per user per month, but if you have 1 or 2 users, €120 is still a budget.

We decreased it to €20 at a time when everyone else was increasing prices because of inflation. We said, “Let us decrease it to €20.” Acquisition started to increase very quickly, and we attracted 2.8 times more clients from that date.

That is insane. How were we acquiring customers in the early days? What did the marketing and acquisition funnel look like then?

In the early days and today, it is still the same. Our main user acquisition channel is word of mouth. We have clients who are very happy, they talk to other clients, and they bring us more clients. Even today, the majority of our leads come from word of mouth.

Going back to the point about a product winning, you need a strong product to turn your users into fans. What do you think about the common saying in startups that speed is the single most important factor in success?

I agree, but I see speed in terms of how quickly you build your assets. For me, the main asset is the product. It is very important to move fast, evolve quickly, innovate, and build the business.

It is not so much about building revenue. At least in my case, revenue grew by 50% per year. That is not huge, but it is still good. We did it for 20 years, and that is what leads to such large revenue numbers today.

What were the hardest things in those early days?

It was always a matter of survival. When you do not have cash to pay employees at the end of the month, it is really hard. When you have to dismiss people you like because you have no other options, it is very hard.

Why did you not raise more? Talk to me about the second fundraise. You said the first one was good, but you sold 30% of the company. What about the second one? How did that go, and where was the business?

In every fundraising, timing is the most important thing. For me, the timing was not right. We raised €7 million at a valuation of €23 million pre-money, or €30 million post-money. It was a time when we needed money.

How much revenue were we at?

I do not know exactly. Maybe €20 million.

You were doing it at a €30 million post-money valuation?

Yes. It was not a good valuation.

How did that fundraise go?

We got 1 offer from XAnge, but only 1.

Did you meet many investors?

Yes.

Why were they saying no?

I think they were scared because we had pivoted, the business model was not there, the traction was not there, we had difficulties becoming profitable, and although we were growing, it was not exceptional growth. It was regular growth.

People particularly like vertical SaaS because it is targeted. You know your customer profile, how to message to them, and where to find them. You have a very horizontal product. You did the opposite. How do you think about winning with a horizontal product when your customer is everyone, rather than being the best in 1 industry?

What we wanted was to be the best in applications. We wanted to be the best CRM, the best accounting software, and the best website builder. That is how we approach things—not based on the customer, but based on the application.

As these applications mature, pretty much all CRMs look the same today. It is not so much about having a CRM for one specific business or another; they are largely the same. It is more about the quality of the product than how you customize it for a specific segment.

Part of my vision is to commoditize the management-software market. When that happens, everybody will use the same CRM, accounting software, and website builder. It does not have to be dedicated to 1 industry. It is like a phone: whatever your industry, you use the same phone.

What do you mean by the commoditization of software? There are so many different people and markets within your product lineup, with different views on user interface, workflows, and messaging. What do you mean by the commoditization of business software?

Today, small and midsize companies do not have a single application. They have a mix of many different applications and a lot of spreadsheets. They use Slack for discussions, Mailchimp for sending email, WordPress for a website, and plenty of other applications.

Those applications do not integrate well with one another, they cost a lot to maintain, and they are not completely efficient. Nobody has succeeded in offering 1 platform that does everything a company needs in just a few clicks.

That is what we started to do. Everybody else has failed. Microsoft tried with Dynamics, SAP tried, and NetSuite tried, but the adoption rate in the market is still very low—less than 10%.

I believe that once the market reaches maturity, management software will be like Office. Everybody uses the same Word, Excel, Slides, PowerPoint, and everything. I think management software will be the same. When it becomes mature, perfectly integrated, and very affordable, it will transform the market.

Why do you think you have done so well and grown to this scale when Microsoft and SAP have tried and failed?

Our product is years ahead of the competition. There is no way they can do what we do.

They have the money and the talent. Why can they not do it?

It is not so much about money. In order to build such complex software—because companies are complex—and make it extremely easy to use, it is more about having the right people. You need a few genius people rather than an army of 10,000 developers.

We have extremely good developers and good management, and we are extremely focused. As companies grow, they lose focus. You have middle management that wants to launch new departments and new products. We have been focused all along on 1 single thing: improving our product.

I wanted to talk about the team because you said something to me earlier that surprised me. You said Odoo never recruits VPs, managers, or even team leaders.

We have a very strong culture. We are a startup that grew very fast, and our culture is very strong. One way to keep the culture alive is to avoid external managers and team leaders coming in with their own habits. Those habits might be good, but they might not be good for our environment.

The other reason is that team leaders are not there to manage people. At Odoo, we have no planning, no budget, no forecasts, and none of those processes. What I expect from a team leader is simply that they make their team better. That is the only objective.

To do that, you have to be the best person on the team. There is no way you can make a team of developers become better developers if you are not the best developer on the team yourself. When you recruit external managers, they are probably not as good as your existing team.

I am confused. If you do not have a budget, how do you plan the business?

We do have a budget, but it is the responsibility of the CFO and the finance team. We do not share it with the teams. The budget is simply about whether we can recruit, how many people we can recruit, and how much we can spend. That is it.

Team leaders do not have to worry about that. Even directors do not have to worry about that. They only have to worry about making their team more efficient.

How do you measure “more efficient”?

You do not need to measure it. When you work with a team, you know who is good and who is not. What I expect from a team leader is to work with the people. When you work with people, you know who is good. You do not need to create a KPI.

You do not set goals?

What kind of goal can you give to a developer? You could say, “Develop this task by this deadline,” but when you are agile, the tasks change all the time.

What about hitting a certain number of users, activities, or a retention target?

For some teams, such as sales, we obviously have goals and sales targets. That is an exception. Most teams do not have them.

I have a story about that.

Please.

This is so different. I love it.

When I was in Belgium, our company in the United States was struggling to grow 10 years ago. I needed to relocate there, so I went for 3 years. When I arrived, we had 10 consultants, and they were completely overloaded. There were too many clients and projects, and it was a real mess. The quality of what we delivered was not great.

I asked one of our best consultants from Belgium to come to the United States and help me restructure the operation, grow the team, take on the most complex projects, and deliver them. At that time, we had a director in the United States who told me, “Here is how I manage the team. I have KPIs for customer satisfaction, time to deliver projects, and the number of applications deployed.”

I told him, “No, do not do that. Just focus on delivering your projects.” He said, “I need these KPIs. How can you manage without them?”

I could not convince him to drop the KPIs, so I waited to see what happened. After 3 months, the person with the worst KPIs was the top expert I had brought from Belgium to deliver all the projects. The director said, “You see?”

When we looked at the numbers, we understood why he had the worst KPIs: we had given him all the difficult projects that were complex to deliver. Things are very subjective. It was obvious to the whole team that this person was the best, yet according to the KPIs, he was the worst. It was simply because we had given him the worst projects.

When you do not have titles and you have team leaders, does that make it harder to hire really great people? Great people often want big titles.

I think it is easier to scale when you do not need to hire the top people. You can recruit young people, recruit a lot of them, train them, and help them evolve. That is easier than always looking for the best VP of this or the best manager of that.

Tell me about how you recruit young people so successfully. You have a large team now—1,800 in Belgium and 5,000 in total. How do you recruit young people so well?

We assess them on the job. If it is a developer, we ask them to develop something. If it is a salesperson, we ask them to do a demo and pitch the product. That is all. We do not look at résumés. We simply give them practical exercises and assess the results.

One thing I noticed is that we also do an IQ test, and it is the second-best predictor of performance. The first is how good you are at development, and the second is the IQ test.

One issue I had with recruiters was that if they spent 30 or 40 minutes discussing the résumé but only 2 hours doing the test, the way they assessed people was influenced by how much time they spent talking about each topic. I asked them to stop focusing on the résumé.

With the logic test, they simply get a number—19%, 20%, or 90%—and they do not spend much time discussing it. I had to train the recruiters to understand that the IQ test was important and the résumé discussion was not.

So the IQ test is the second-biggest predictor?

Yes.

We get them through the practical exercise, assess how good they are at development or sales, and give them an IQ test. What else is involved in the process?

That is it. Our process is extremely fast. There is 1 meeting, and we decide right away. Usually, we recruit within 5 days, and everything is automated.

You apply online, book a meeting with the interviewer directly in their calendar, and get a meeting within 2 to 4 days. The day after the meeting, you get an offer. We beat the market simply because we are fast.

How often are you right? We are often told that good hiring decisions are right only 50% of the time.

If you are recruiting smart people, it is quite easy to notice. If you watch a developer develop for 3 hours, you probably know at the end whether they are good or not.

You assess how good they are at development or sales, and you give them the IQ test. But that is not a culture fit. You can have smart people who are not pleasant. How do you think about that human component?

Those are exceptions. Most of the time, people will fit into your culture if your culture is good. Sometimes you have an issue, but it is exceptional—probably less than 1% of the time.

When someone is not great, how quickly do you know?

Quite quickly—within 6 months.

What takes so long?

It is harder for a young team leader to act. Nobody wants to dismiss someone, so it is difficult to act. But you notice the problem quickly.

What are the reasons younger people struggle when you bring them in?

For me, it is always competence. You will either succeed or you will not. More than 90% of the people we dismiss are dismissed because of competence: they are not good developers, or they do not understand sales.

We are both European. I am a proud Londoner, and you are a proud Belgian. People often say that young people in Europe do not want to work as hard as people in the United States. Do you agree with that statement?

I think young people are different from what they were 20 years ago, but the new generation wants to work. They need a purpose. They are ready to work a lot to do something great.

We have done something great because the average age at Odoo is 26. We built a company of 5,000 people with an average age of 26. We built something big, with millions of users. Young people are capable of working; they just need purpose, passion, and the feeling that they are having an impact. They will not work if they feel they have no impact.

The average age is 26. Do you ever worry about emotional maturity? As I get older, I realize how much I have changed. When I was younger, I was more rash, fast, and emotional. Now I am slower, more thoughtful, deliberate, and calm. Is that ever a challenge?

No. I think the key is to train people and help them evolve quickly. You can hire younger people, but if they evolve quickly, it works.

How do you structure the training?

We have 1 month of onboarding, with a lot of e-learning, tests, exercises, and certifications. After that, it is more about coaching on the job by the team leader.

The team leader is responsible for the training of that team?

Not during the first month. We have a dedicated team that trains everybody during the first month. After that, they join their team, and the team leader takes over.

How many people are on a team?

The teams are quite small—around 10 people. There is 1 team leader for around 10 people.

Do they have weekly team meetings?

We do not have a lot of meetings. I forbid recurring meetings at the company. They can have meetings for specific tasks or training, but not recurring meetings.

Recurring meetings are a way to manage people, and we try to avoid managers. We want team leaders who work with their teams, so we try to avoid recurring meetings.

They do not have a weekly recurring team meeting?

No. They work with each other every day, so they do not need one.

Do you like remote work?

It is okay. It has benefits, but I do not do it myself.

Are there any other elements of traditional management that we always hear about—recurring meetings, a huge emphasis on culture fit—that you think are wrong?

I think a lot of CEOs are wrong.

Why?

If you look at their agendas, they are constantly meeting people, having coffee with someone, going to events, and so on. I think the company needs them more than external people do.

How do you spend your day?

Around 50% of my time is spent on the product—research and development with the product owners and developers. The other 50% is spent improving internal processes.

What does improving internal processes mean?

It changes month by month. If our marketing is not good enough, I will work with marketing for 1 or 2 months. If the services department needs a pivot or improvement, I will work there. Sometimes it is in a country.

I spent 1 year in India because the company was not growing enough, so I relocated myself there for a year. It changes depending on what is needed.

You relocated yourself to India for a year?

Yes. I have a wife and children, and they came with me. They also came when I went to the United States, although that was not as easy.

You were in Gujarat?

Yes.

How was going to India for you—packing up with your wife and 2 children?

I loved it. India is an experience. It is colorful, noisy, and full of activity.

Why was Odoo India not growing?

When you grow a company from 1 to 10 people, it is a real challenge. Growing from 10 to 100 is a different challenge, and growing from 100 to 1,000 is another one.

The director in India was one of our first employees. I started with him when he was a student, and he grew the company to 200 people. Then it struggled. For 7 years, the company stayed at around 200 employees. He could not grow it further, even though he was good. He simply needed help.

I went there to help, and we grew to 800 people. It is still the same team, with the same managers. I replaced nobody because they were all very good. They just needed a little help.

Where is Odoo India now?

We have 800 employees, and we grew significantly. When I arrived, we were signing 16 new clients per month, which is nothing. Now we are around 800 per month, and it continues to grow.

If I asked you to describe the challenges of going from 1 to 10, 10 to 100, and 100 to 500 or 1,000, how would you describe them?

Going from 1 to 10 is about building the business. It could be the product or the service offering. It is all about you and the team working on improving the business and the product.

Going from 10 to 100 is when your job changes as a founder. You start to have middle managers, so the culture is no longer just you. It is the middle managers and the way they behave with people. We spend much more time communicating to ensure the culture is aligned and everybody is aligned.

Going above 1,000 is all about scalability—making things smooth and clean so that you can keep growing.

When we speak about the team, I spoke to one of your investors or team members—I cannot remember which—who said that you hire people for being world class at something. The flip side is that they can be catastrophic at other things. Can you talk to me about that?

If you look for people who are perfect at everything, you will get people who are average at everything. If you want someone who speaks multiple languages, is a good developer, and is a good communicator, they will probably be average.

If you dismiss people because they are bad at something, expect to have average people at everything. If you want people who transform your company, they have to be extremely good at something. To get that, you have to accept their weaknesses.

I train our recruiters to look for strengths and accept some weaknesses. When we discuss the interview afterward, it is more about whether the person is a very good developer or very good at something, rather than whether they do not speak a language very well. You focus on where they are good rather than on their weaknesses.

Are there unacceptable weaknesses versus acceptable weaknesses, or does it depend on how strong the person’s strength is?

It depends on the department. Some departments are extremely flexible. If someone is not social, you can put them in a separate office, and that is fine. It depends on the context.

What have been your biggest hiring mistakes?

It is not so much about hiring; it is about firing. I am always too late, like a lot of people.

How do you think about improving that moving forward?

I keep saying to myself, “When there is doubt, there is no doubt.” We are entrepreneurs, and entrepreneurs are always optimistic. We want things to work, and we think things will get better. You cannot survive as an entrepreneur if you are not optimistic.

When you start thinking negatively about someone—“It does not work. I do not want to work with them”—it is probably already too late.

So you would fire sooner?

Yes.

You mentioned India and the incredible scaling from 16 to 800 clients per month. Going into different geographies and expanding internationally is a massive strategic decision for companies. You seem to have done it early and all over the world. You have people in Dubai, India, and many other places. How did you think about going global? What worked, and what did not?

For me, the key is not so much the country or the city. The key is finding the right director. You can go to San Francisco or Silicon Valley and have an average director, and it will not work. You will spend a lot of money, and everything will be bad.

If you have the right director, the city is not that important, especially for us as a SaaS company, because we sell everything online. That is why we have a company in Buffalo. Nobody goes to Buffalo in the United States, but we had an amazing person on the team. We wanted to do something with him, and he wanted to go to Buffalo, so we said, “Create a company and build something there.”

He hired a team in Buffalo and opened an office. We always proceed that way: we first find the person, and only afterward does the person define where we go.

How do you think about budgeting for those leaders?

We do not work with budgets, but we have people who are responsible. Because we only promote internally, these are people we have worked with for years, so we know they will be good and spend efficiently. We do not have that kind of issue.

You only do internal promotions?

Yes. We never recruit managers or directors—never. Even when we open a subsidiary in a different country, we send someone from inside the company.

You send them out?

Yes.

You also said that you never go to Tier 1 cities. You prefer Tier 2 cities. Why?

The key to scaling a business is retention. We have an office in San Francisco, so we did not always follow this rule, but we learned from it. When you are next to Google, Microsoft, and Apple, how can you get the best people? You have a higher turnover than in other cities.

In Buffalo, we have no issue. Nobody leaves. People are happy, and they have a very high salary for the area. Retention is very good, and retention is the key to growing your business.

Why do you think retention is the key to growing your business?

Take a salesperson. In their first 2 years, they will sell a certain amount. With 3, 4, or 5 years of experience, they will sell twice as much. If you keep them for only 3 years, you will have far less efficiency than if you keep them for 5, 6, or 7 years.

Do you think people are destined for certain stages of company development? There is a Silicon Valley trope that someone is a “zero-to-one person” but not a scale person.

It is possible for some people, but smart people can evolve. The majority of the people still working with me have been with me since the beginning. We grew from 1 to 5,000 people, so they evolved with the company.

You are in intensely competitive markets. I interviewed Marc Benioff at Salesforce this week, and people often say Salesforce is the company to be disrupted. You compete with some of the biggest companies in the world. How do you think about competition?

I feel that we have no competition, although we have plenty of competitors. I will explain why.

We are a suite of business applications. Whatever you need, we have it: CRM, accounting, logistics, and so on. We do everything companies need, and we do it at an extremely affordable price. You start at €20 per user and get all these applications.

Nobody has succeeded in doing that in the market. There are 2 types of competitors. You have the large players, such as SAP and Microsoft. They offer several applications, but the software is slow, expensive, and people are not happy using it.

Then you have the smaller players, such as Slack, Mailchimp, Trello, Asana, and others. They do 1 thing very well, acquire a lot of users, and only do that 1 thing.

Nobody has succeeded in offering the benefits of both: all the applications a company needs while being extremely simple and affordable. For me, it is more about cracking something that nobody else has cracked than competing against individual companies.

How would you feel if someone said, “We like Odoo because it is the cheapest”?

It is true. Part of my goal is to be the cheapest. If I can decrease the price, I will do it immediately because I want to commoditize the market and make technology affordable.

That goes against many lessons. Marc Andreessen always says that if you are a small company, charge small prices; if you are a medium company, charge medium prices; and if you are a big company, charge big prices.

In a way, that is true. But if you want to commoditize the market and have every company use your software, you need a very low price.

Are we in a race to the bottom? Google Workspace and Microsoft Office are not very expensive, but everybody uses them.

They monetize those businesses with other cash cows, such as Google Search. We do not have that.

How do you think about your ultimate cash cow if you are commoditizing all the way down?

Why is that important? We do not have cash issues. Since 2014, we have not raised money. We are growing, and we have enough cash.

I do not know if your revenues are public.

They are €550 million this year.

€550 million this year. You were at around €200 million in a deck from 2023, so you are growing by 50%.

Yes, we grow by 50%.

If you want to become a $100 billion business, you need to keep tripling your revenue first.

I do not care about the valuation. I care about revenue because cash is a way to finance what I need to do.

You do not care about the valuation?

No. What I want to do is develop Odoo. That is the thing I would like to do. I do not care about money, and I do not need money, so why should I care about valuation?

You have to understand, Fabien, this show is very strange for me. You say you do not hire VPs, and you do not care about valuation.

It is a good side effect to have a good valuation, but it is not what should drive you. It is much more important to deliver software that transforms companies and has an impact on your clients.

Do you think we build companies completely wrong today? All I talk about with founders is how much revenue they need to raise a Series B, and how much revenue they need to raise a Series C.

I am not an investor, but what I would look at is the product and the capability to build the product. In the end, it is always the best product that wins, in my opinion. I am not an expert; I have only scaled 1 company.

You said you care about financing what you need. What can you not spend money on?

We get so much cash that I cannot spend it. I am trying to recruit as fast as I can, and I have enough money.

Is there anything you would love to spend on that you do not have the cash to spend on?

No. I could spend much more on marketing, but I do not think it would help a lot.

What do you think about the Odoo brand? Respectfully, for the size of company you are and the number of customers you have, it is not the biggest brand in traditional technology circles or VC circles.

In small and midsize companies, it is starting to become a brand.

At what stage did you start to see the brand build?

When we started investing in marketing more aggressively, around 4 or 5 years ago.

Jason Lemkin says that when you get to around €10 million in revenue, you start to have a mini brand. Do you think that is true?

Yes.

You also mentioned that you have to be optimistic as a founder. That is core to what we do; otherwise, you do not survive. How important is naivety to being a successful founder?

I think I was very naive. I do not know whether it was good or bad, but I was very naive. When I was 26, I purchased the domain name Sorry.com because I thought that one day I would be much bigger than SAP, and then I would use that domain name.

At 26, I really thought I would disrupt SAP within 5 years. I was very naive.

That is absolutely amazing. Do you still have the domain name?

Yes. We used it when we released version 14 because it was a really good version. In my opinion, it was much better than SAP at the time. We replaced the home page with 1 big word: “Sorry, SAP.”

How is SAP still so big?

They are a monster. They are the clear and nearly only leader for large companies. For very large companies, there is only SAP. Oracle tries to do something, but it is all about SAP.

Do you still want to displace SAP?

Yes.

What do you think the timeline is now?

First, I think it is just a matter of time. I do not know how they can survive what is coming. We are so far ahead, and we are taking so many clients from them that it is just a matter of time.

But it will take time—maybe 10 or 20 years.

Where is SAP better than you today, in terms of the product?

Nowhere.

What about marketing?

Not even there. They are much more well-known, but they do not have a good brand. They have a huge market, so their customer base is massive. Where they succeed today is with large corporations. With small and midsize companies, they failed. In large companies, they are still the main option.

You spoke earlier about your sales team. Sales teams are really hard to build, and building a go-to-market function is tough. What have been your biggest lessons in building the sales team effectively? How did you recruit the VP of sales?

It was not about recruiting. It was about promoting internally. For me, a leader is someone who trains others, can explain things, and can help people improve. That is important when scaling the company.

For us, it is all about the product. We teach salespeople how to do demos, and they do 2 demos per day. After they do that for a few weeks, they start to become good.

Two demos per day. When the product is so cheap, what is the average contract value?

Around €3,500 in annual recurring revenue.

That is not enough to justify outbound sales.

We do not do outbound. We only do inbound.

Why do we not do outbound, even now?

We started a few months ago, but it is only a small team—around 30 people at the company.

So, before half a billion in revenue, you were only doing inbound leads?

Yes, but we get a lot of leads.

Why did you decide to do outbound now?

We are becoming very mature, and we are starting to launch applications by industry. We have applications for plumbers, restaurants, and many other industries. We are launching in 50 industries, and that is easier with an outbound strategy.

We are just testing it. We have 30 people out of around 1,800 in sales.

How did you determine which industries to enter?

It is a matter of product-market fit. We already have the product, and it is used in many industries. We started with the industries where we are already strong.

This is the most unique story I have done. Where else do most other companies fail as they grow?

We have touched on a lot of it. CEOs lose focus. Many companies lose focus as they grow.

You have not done that?

No. We have 1 product, 1 way to deliver the service, and only 3 big departments. All our companies, everywhere, operate in the same way.

Our product has only 400,000 lines of code. Even though it looks complex because it does a lot of things, it is still extremely simple. I still feel that we are a very simple company.

How do other companies lose focus?

They launch new products and new departments. They have marketing ideas, spend time meeting clients and the press, and do many other things.

When you start having managers, managers of managers, and team leaders, they all want to do something. They all have ideas. There is a kind of dark force pushing everyone to make the company more complex. To keep the company simple, you always have to fight back against that.

My favorite example is brainstorming meetings.

When you look back on this incredible journey, what did you do that you wish you had not done?

I wish I had communicated better with the community. I built the open-source community on the belief that we were open source and would always remain open source.

I think I would have saved 1 year in the development of the company if we had said, “We are open source today, but maybe in the future we will need to monetize.”

How long did it take to rebuild that trust?

Probably 1 year. Even today, there are people who say, “You are not really open source.” We still get negative comments about that from time to time.

You said earlier that you are not really focused on the money. That is a very interesting thing to say to a venture capitalist.

You recently did a secondary transaction. What was the transaction?

It was €500 million at a €5 billion valuation. Summit Partners, one of our early investors, sold to Sequoia Capital, BlackRock, Mubadala, and CapitalG.

Do you think that was the right price?

I think it is still quite low.

You are doing €550 million in revenue and growing by 50%, and your margins are good.

You have to understand something: I always wanted the price to be low. In every transaction, I was purchasing shares. All the managers at Odoo are always buying shares; we never sold shares. So, for us, if the price is low, that is fine.

You were buying shares in every round?

In every round. We bought shares to the point where we had to get a large loan because we did not have the money. We are just simple people, so we got a large loan to acquire shares.

In every round, were investors emailing you constantly saying, “We want to meet”?

Yes.

Why did you not meet them?

It was a waste of time. I meet them when we have a transaction. Once every 3 years, we have a transaction, and then I am happy to meet everybody.

Do you not think it is helpful to build a relationship beforehand?

I think it is, but I had better things to do, such as developing the company.

You have €500 million in secondaries now. Who does that go to? Early employees?

No. It was mostly Summit Partners.

They acquired shares in a secondary transaction in 2019 as well?

Yes.

You did not sell any shares in this round?

No. Since 2014, we have not done any fundraising. We have only done secondary transactions.

How much of the company do you have?

57%.

You only did 2 fundraises, at very bad valuations, and still kept the majority of the shares.

Yes.

Do you factor in that this means you are worth $2.8 billion?

As I said, it is on paper. I do not care. It is not like I have that money in my bank account. It simply means the company is huge.

But you have a real company. It is much more important.

Most valuations are fake. Ours is real because we are extremely profitable.

You could sell to SAP or someone else today.

We will never sell. At least, there will never be an industrial exit.

Why do you not want to sell?

It is much better to transform companies, change the world, and disrupt SAP than to have money and go to the beach.

Would you like to IPO?

No. There will never be an IPO. I do not want to.

Why?

Public companies tend to refocus on the short term. Our success has always come from building for the long term, and I do not want to refocus everybody on quarterly earnings and results.

Second, I do not want the constraints and complexity that come with being public. I like being able to say whatever I want. I could say that I think Odoo is worth much more than €5 billion—perhaps €7 billion—but if I were public, I could not say that. I would have to disclose everything.

I want to keep the company simple, and for that reason I prefer to avoid an IPO.

How do you think about liquidity for the other 43% of the cap table, who will want some financial return at some point?

We were aligned from the beginning. It was very clear with every investor that there would be no IPO and no industrial exit. It would be secondary transactions.

They all agreed for 1 reason: if you have a really good business—one that is growing quickly, is profitable, and has the best key performance indicators you can get—it will be easy to sell shares. We do that on a schedule, every 3 or 4 years, when 1 of the investors wants to sell. We help them sell.

Do you have any investors who would like to sell now?

No, because we just did this €500 million transaction. We had more buyers than people selling.

How did you choose the people you selected?

We are working with Sequoia Capital, CapitalG, BlackRock, and Mubadala. They are the best investors you can get.

How do you think about the future of Salesforce? I had Marc Benioff on the show, and everyone says Salesforce is the company to be disrupted.

I think it is the same as SAP. They will continue for a while, but new challengers like us will grow much faster.

Do agents help or hurt you?

Both, but I also think agents are overrated. There are plenty of good use cases in AI, but there is also plenty of overrating.

What is overrated?

Agentforce, which Salesforce presented during Dreamforce. I do not know whether you saw the video. There was a use case in the keynote where you could call a help desk, ask for information about your order, and then change your order.

For that, you could have a very good user experience and a good portal. You click on a button in an email and change your order. It is much more efficient.

I am pretty sure that if I call a help desk with my terrible English accent, it will not recognize me. It will ask me complex questions to identify me. In many cases, having a very good user experience and a good product is more efficient than AI.

There are also many use cases where AI is good. In accounting, it is transforming the market. We now have 98.5% recognition on invoices and bills, which is better than humans. That transforms the market because accountants no longer need to enter data into the system; they simply validate it.

How do you think about integrating AI most effectively into Odoo today and moving forward?

You have to start with the problem. A lot of people start with the solution: “I want to do AI.” But if you start with the problem and look at where people are wasting time or being inefficient, you find good use cases.

Then you ask what the best solution is. Sometimes it is simply a well-designed user experience or a feature that saves people time. Sometimes it is AI, and sometimes it is a different algorithm. AI is 1 tool for improving software, but there are many others.

Do you think we will go through an AI winter in the next few years, where the promised return on investment is not delivered within the expected timeframe?

It is going to be interesting. I do not know. But there will definitely be very disruptive use cases, so even if that happens, we will win in many areas.

Do you have a board for the company?

Yes, 5 people.

Do you like it?

It is one of the only things I do not like. I do not like giving presentations in general.

Why?

I prefer working on the product, improving the marketing department, or working with the salespeople rather than writing PowerPoint presentations.

Having said that, there was a time when I did not like it. Now it is good because we have good investors.

When you look at your own CEO role, where do you need to improve? Where would you like to spend more time?

I do not want to get older. As time goes on, I feel that I am not as smart as I was before. I am slowing down a little, and I do not like that.

You are also the chief product officer?

Yes. I am also the head of marketing, and I work a lot with the other departments, including services. I do many things.

Which part is least natural for you?

I am a generalist, so I think I am good at many things. Perhaps what we are doing now.

Trust me, I think you are very good at this.

When we think about Odoo becoming a $100 billion company, I know you said you do not care about valuation, but what does Odoo need to do to become a $100 billion company?

Continue doing what we do today. Do not lose focus, innovate year after year at the same pace, and grow the company by 50% per year while keeping the culture.

When do you really need to go into the enterprise?

We are doing enterprise now. We are taking clients from SAP. Thanks to SAP S/4HANA, which has been a disaster and nobody wants to move to, the door is open for new entrants.

Do you need to build an entirely different company to go into the enterprise?

I had to create a different department and methodology. The way we pitch and sell is different. Having said that, we kept part of our culture. Even though it is a different department, it is still part of our company.

How is it different?

This market is owned by services companies. When you want to buy an ERP, it costs millions in services, implementation, and everything else.

As a software vendor, I want to reduce the amount of services as much as possible. I am not interested in service revenue. Services are only 18% of our revenue, but they are necessary to deliver the product and put the client into production.

Because we try to sell as little service as possible, that changed our implementation methodologies. Over time, we developed methodologies that are extremely efficient. They do not focus too much on the heaviness of traditional methodologies.

What was the biggest challenge in building out enterprise?

For us, it was the culture. There is something funny that happens when we start working with a large client. During the demos, when they see the product, everybody is excited and dreaming about what is possible.

But I know that the first 1 or 2 months will be difficult because there will be a culture clash. Our teams are extremely efficient and direct. They want to deliver and move forward, and that sometimes does not work well with the culture of large companies.

We often have a culture clash during the first or second month. Then both companies align, and the project becomes smooth. But we often have that initial clash.

How do you think about your culture more broadly? Company culture is one of the hardest things, and you said to me that it matters more than processes.

Obviously. For me, Odoo's culture has 3 elements, at least for the people: autonomy, responsibility, and evolution. Everybody says that, but for us it is true. For many companies, it is not.

Autonomy means that everyone can make decisions?

Yes. You give them the authority and the tools to do it, even for one-way-door decisions. People are smart. If they are not sure, they will still ask. They can decide what they want, but they are smart enough not to do things that go against the company.

What was the second element?

Responsibility. People must take responsibility. Young people are not responsible by default. The education system has taken that away, so we have to train them to make decisions.

You train them through the way you behave with them. Suppose a salesperson needs to give a demo to a customer and comes to your office saying, “I need a barcode scanner for my demo. Can I buy one for $50?”

If you answer the question for them, they will always ask you in the future. If you tell them, “You are smart. You know whether it is worth it or not. Decide,” they will take responsibility. The way you behave with people forces them to take responsibility.

How do you think about the expenses element? Netflix says, “You are the owner. If you think it is reasonable to spend company money on it, do it.” How do you feel about that?

Having a process to control what people spend would cost more. If you have a purchasing department and someone has to ask permission to buy a $30 scanner, it will cost more than $30. It might waste 5 days just to get the product.

At Odoo, people can buy it online on Amazon and get reimbursed immediately. It is a good trade-off.

You mentioned evolution and growth. People want titles when they grow because titles show their progression. They want to become VP of sales or head of product. When you do not have those titles and you have team leaders, how do you think about evolution and signifying it?

At Odoo, everyone chooses their own title. Some people choose funny titles; others say “Director of X.” We do not care. We print the business card with whatever title they choose.

I want to eliminate the idea that the title matters. What matters is what you do, not the title you have.

Do you worry about what that says to the external world? If I am 23 or 24 and a junior salesperson, I could put “VP of Sales” on my business card.

People are smart. Most people will not do that. They will choose something like “Director of Sales,” and that is fine.

When you think about your biggest strategic mistake in building the business, what comes to mind?

The business model was difficult. It took me 15 years to get to the right business model. I tried operating as a services company, then selling maintenance and support, and only later moved to SaaS. SaaS worked, and then we moved to open core.

I have so enjoyed doing this. You are an incredible CEO, CMO, and CPO. You have built this incredible business, and you also have 2 children. How do you balance being a father to 2 children and the CEO of a 5,000-person company?

Like everybody else. It is not difficult to be a father.

But most people do not run a 5,000-person company.

I think my life is easier now than it was when we had 100 people. We do not have cash issues anymore. When you do not have cash and pay salaries late, you do not sleep. You feel terrible, and you have to work twice as much.

My life is still complex, but it is much easier than before.

So it gets easier over time?

It gets easier as the company matures and becomes financially sustainable.

What does great fatherhood mean to you?

I do not know. Just make them evolve, like my teams at Odoo.

If you could change anything about the journey—anything at all—what would you change?

I would tell my younger self to take better care of how I managed the community during the switch in the business model. That is the thing that really stayed with me because I went too far.

I really wanted to build open-source software. That was my passion, and I took it to the point where I could not pay salaries for years. The funny thing is that what I wanted to do was build open-source software. When I switched to open core, with 80% open source and 20% paid, I could increase the development team by 10 times.

I am now contributing much more to open source than before, so it was a bad calculation on my part.

What would you do if you were not doing this?

I think I would do the same. I do not know what I could do better than this. Odoo is such a part of me.

Do you know what I mean?

Yes, it is. When you build a fast-growing company like this, you have to be obsessed. I do not think you can succeed if you are not obsessed and thinking about it all the time.

If you look at it as just a job, I do not think you can build such a fast-growing company.

Do you mind people looking at it as a job? What I struggle with is that my expectations are misaligned with theirs. I work like a founder, I work extremely hard, and I am obsessed. But for many people who work in our companies, it is a job.

That is fine. I understand. They do not own 56% of the company, so I understand. It is normal.

I have so enjoyed this. Let us move to a quick-fire round. I will give you a short statement, and you give me your immediate thoughts. Does that sound okay?

Yes.

Venture capital.

It is hard to say, but it is very difficult for some venture capitalists to participate a few hours per month—perhaps 2 hours per month—and understand the business as deeply as you do.

I believe they add value by pointing out elements and challenging you, but ultimately the solution has to come from you. They can offer a point of view and challenge you, but they will never tell you what to do. If you treat them that way, you might make a lot of mistakes.

What have you changed your mind on most in the last 12 months?

I change my mind a lot. It is usually about product features. We argue a lot about product features, but they are details that are complex to explain. Usually, it is small details.

Who do you not have on the board whom you would most like to have on the board?

I do not care. As I said, the board is not the most important thing for me. The executive committee and the team leaders I work with are much more important than the board.

I probably should not say that.

It is fine. Nobody listens to this.

At the end, it is the people who do the work. They challenge me even more than the board.

You can be CEO of any other company for a day. Which company do you choose?

The government.

The government?

Yes. I would have to be president of Belgium.

What would you change?

Education.

Why is education broken?

It is very slow, and it does not set good expectations for children. In Belgium, they do not even teach computers. My children were in India, and at 11 years old, they had lessons in entrepreneurship, leadership, Python development, chess, and similar subjects.

In Belgium, we have none of that. We only have mathematics, French, physics, and biology.

Is Indian education better than Belgian education?

No. In Belgium, all the schools are average or good. In India, the range is much broader, from very bad to very good. But India has extremely good schools.

Do you pay people differently depending on geography?

Of course.

Is it not a uniform salary across the company?

No. You can buy things in different places, and I think you should also pay people very differently based on competence. The best people should earn much more than the others.

Do you have transparency around salaries?

We publish our average salaries on our website because it is part of our recruitment process. We tell candidates the exact salary they will have. They can configure it, choose their car—there are cars in Belgium—choose their benefits, and everything is available online.

People say that if a candidate is obsessed with titles, they are not good. Do you agree?

No. I understand that some people like titles, and that is okay. That is why, at Odoo, they can choose their own title. If they like titles, they can choose one. If they do not care, they can choose a funny title.

You are an investor for a second. You can buy OpenAI at $160 billion, Anthropic at $40 billion, or xAI at $50 billion. Which do you choose?

I do not like any of them.

Why not?

They are both risky and difficult. It is difficult to say what will happen with either of them.

First, I do not want to be an investor. The thing I like least is going to board meetings, so that does not interest me.

What do you do with your money today?

If I have money, I buy Odoo shares. It is the best investment I can make. I do not know another company that can give me 50% growth year after year, and I am quite sure about Odoo.

You say it is purely financial, but you do not really care about the financials. If you cashed out, what would you do?

If you gave me the small amount of money I have in my bank account, I would still have to decide what to do with it. Because I do not need money, I simply invest it in Odoo.

Does having money make raising children easier?

It does not change anything because I am still the same person I was 10 years ago. I have a very small car, I do not have a house, and I live in my wife's house. When we were in India, we lived in an ordinary apartment. It does not change anything for me.

What about the way your parents brought you up? Have you done anything differently with your children?

My father was an auctioneer who sold old things, more traditional things. He taught me that hard work is important. He was, and still is, working 10 to 12 hours per day. Sometimes he works even more than I do.

What question have I not asked that I should have asked?

I think you are good at your job.

If I asked you about Odoo 10 years from now, what would be a great answer?

To predict the future, you have to understand the past. If you look at the past, it started with operating systems. You are probably too young, but it started with many operating systems. Fast-forward to today, and there are only Windows, iOS, and Linux.

Then came Office. After the complexity of operating systems, which were purely technical, Office brought the complexity of user experience: Word, Excel, and similar tools. There was Lotus 1-2-3 and many other office tools. Fast-forward to today, and there is Microsoft Office and Google Workspace.

Now, in addition to technical complexity and user-experience complexity, we have the complexity of businesses. I believe management software will follow the same trend. Today, there are plenty of players, but in the future, this technology will become so mature and commoditized that there will be 1, 2, or 3 players with the entire world market.

That is my goal.

It is so special for me to do shows like this. What an incredible business, but also—and I do not mean this sycophantically—what an incredible person.

It is so rare to find someone whose love for the company and the product is so pure. It is genuinely inspiring.

You said this is your least natural habitat, but you have been incredible. Thank you so much for being so fantastic.

It is good for my ego to come here.