Odoo CEO Fabien Pinckaers: The Billionaire Who Refuses IPOs and VPs

Meet the Belgian entrepreneur who started coding at 13, survived near-bankruptcy multiple times, and built Odoo into a global software giant through unconventional management principles.

Key Takeaways

• Fabien Pinckaers owns 57% of Odoo, valued at €5 billion, making him worth approximately €2.8 billion on paper
• Odoo generates €550 million in annual revenue while growing 50% year-over-year for two decades straight
• The company operates with no VPs, no budgets for teams, no forecasts, and prohibits recurring meetings across departments
• Pinckaers switched from pure open source to "open core" model, keeping 80% free and charging for 20% of features
• Despite half-billion revenue scale, Odoo only started outbound sales a few months ago with just 30 people
• The company maintains 98.5% invoice recognition accuracy using AI, outperforming human accountants in data processing
• Average employee age is 26 years old across 5,000 global employees, with internal promotions exclusively for management roles
• Pinckaers bought the domain "sorry.com" at age 26, planning to eventually surpass SAP and redirect their traffic
• There will never be an IPO - the company commits to secondary transactions every 3-4 years for investor liquidity

The Unconventional Path to Billion-Dollar Success

• Pinckaers started his entrepreneurial journey at 13, developing business management software for friends and family members
• His first major success was an art marketplace that sold 15,000 pieces monthly, actually outselling eBay in Belgium
• The art business generated around €5,000 per month for a student but had fundamental business model flaws
• Unlike typical startup advice, he deliberately chose the "fat startup" approach, building a complete ERP system from day one
• This comprehensive approach took two years to develop the first sellable version, defying lean startup methodology
• The decision to build everything simultaneously created the foundation for Odoo's integrated platform advantage today

The Belgian entrepreneur's journey contradicts conventional startup wisdom at nearly every turn. While most founders are advised to start small with MVPs, Pinckaers intentionally built a comprehensive business management suite. This approach nearly killed the company multiple times but ultimately became its greatest competitive advantage.

• Odoo survived several near-bankruptcy periods, with Pinckaers sometimes having only two weeks of cash remaining in accounts
• The company scaled to 100 employees purely through professional services revenue before transitioning to software licensing
• Early funding rounds were completed at "very bad valuations" according to Pinckaers, but he maintained majority ownership
• His first €3 million funding round in 2010 valued the company at just €7 million pre-money
• The second round raised €7 million at €23 million pre-money, still considered undervalued for the company's potential
• Despite poor early valuations, maintaining control allowed Pinckaers to execute his long-term vision without external pressure

The Open Source Betrayal and Recovery Strategy

• Odoo originally built a passionate open source community based on promises of permanent free access to all features
• Financial pressures forced a pivot to "open core" model, keeping 80% of features free while charging for 20%
• The community felt betrayed and created significant backlash, with partners attempting to migrate to competitor solutions
• This transition cost approximately one year of growth and damaged relationships with key stakeholders and advocates
• Pinckaers admits he should have communicated future monetization plans from the beginning rather than promising permanent free access
• The superior product quality ultimately retained most customers despite initial community anger and negative publicity

The open source community controversy represents one of the most challenging periods in Odoo's history. When survival necessitated monetization, the company faced a choice between staying true to open source principles or ensuring business continuity.

• Marketing became "very bad" during this period with constant criticism from former supporters and community members
• Many partners initially tried to find competitive alternatives but ultimately returned due to product superiority
• The lesson learned was about setting proper expectations rather than making absolute commitments about business models
• Today, negative comments still occasionally surface about this historical decision, showing lasting impact on brand perception
• However, the open core model proved essential for scaling development and improving the product for all users
• Pinckaers now contributes more to open source development than ever before, with a team 10 times larger than previously possible

Revolutionary Management Philosophy That Defies Silicon Valley

• Odoo never recruits external VPs, managers, or team leaders - all leadership positions are filled through internal promotions exclusively
• The company operates without budgets for individual teams, forecasts, planning processes, or formal KPI systems for most departments
• Team leaders have one primary responsibility: making their teams more efficient through direct collaboration and skill development
• Recurring meetings are explicitly forbidden across the organization, with exceptions only for specific tasks or training purposes
• Decision-making authority is distributed throughout the organization, with employees empowered to make autonomous choices within reason
• The hiring process consists of practical demonstrations, IQ testing, and single interviews with decisions made within five days

This management approach stems from Pinckaers' belief that traditional corporate structures create unnecessary complexity and reduce efficiency. Teams of approximately 10 people report to leaders who must be the best performers in their respective areas.

• Team leaders cannot effectively improve developer skills unless they are superior developers themselves, according to company philosophy
• Financial planning and budgeting remain exclusively with the CFO and finance team, removing these concerns from operational teams
• Employees can purchase necessary equipment or tools without approval processes, trusting individual judgment over bureaucratic controls
• The average employee age of 26 demonstrates the company's success in developing young talent through intensive coaching
• IQ testing serves as the second-best predictor of employee performance, after domain-specific skill demonstrations
• Cultural fit issues affect less than 1% of hires, with most problems stemming from competency rather than personality conflicts

Pricing Strategy That Breaks Industry Rules

• Odoo decreased prices to €20 per user monthly in 2022 while competitors increased rates during inflation periods
• This contrarian pricing strategy resulted in 2.8 times more customer acquisition since implementation, dramatically expanding market reach
• The company intentionally pursues commoditization of business software, believing it will follow patterns of operating systems and office suites
• Historical pricing changes included disastrous experiments with usage-based models that nearly destroyed partner relationships for nine months
• Current average contract value stands at €3,500 annually, considered too low for traditional outbound sales approaches
• Revenue growth maintains 50% year-over-year rates despite lower per-customer pricing, proving volume strategy effectiveness

The pricing philosophy reflects Pinckaers' vision of making business software as ubiquitous as Microsoft Office or Google Workspace. Rather than maximizing short-term revenue per customer, Odoo focuses on market penetration and long-term ecosystem development.

• Traditional SaaS wisdom suggests higher prices for enterprise customers, but Odoo maintains consistent affordable pricing across segments
• The goal is making management software accessible to companies of all sizes, from small businesses to enterprise clients
• Low pricing enables the company to compete effectively against both expensive enterprise solutions and point solutions
• Customer acquisition cost remains sustainable due to strong word-of-mouth referrals from satisfied users
• The strategy assumes that software categories eventually consolidate around dominant platforms, similar to historical technology adoption patterns
• Maintaining affordability while improving functionality creates barriers for competitors trying to match value propositions

Global Expansion Through Strategic Talent Placement

• International expansion strategy prioritizes finding exceptional local directors over selecting optimal geographic locations for operations
• The company operates offices in unconventional locations like Buffalo, New York, chosen purely based on talent availability
• Tier-two cities are preferred over Silicon Valley-type locations to reduce employee turnover and recruitment competition
• India operations grew from 16 new clients monthly to 800 after Pinckaers relocated his family there for one year
• The Indian team expanded from 200 to 800 employees during his residency, demonstrating hands-on leadership effectiveness
• All international managers are promoted internally and relocated from existing operations rather than hiring locally

This approach contradicts typical expansion strategies that emphasize market research and geographic optimization. Instead, Odoo builds around exceptional individuals regardless of their location preferences.

• Retention rates in tier-two cities significantly exceed those in major tech hubs due to reduced competition and higher relative compensation
• The Buffalo office exemplifies this strategy, created specifically because an outstanding team member wanted to establish operations there
• Employee retention becomes the critical factor for sustainable growth, making location selection secondary to talent development
• High-cost markets like San Francisco create unsustainable turnover rates when competing against major technology companies
• Secondary transactions every 3-4 years provide investor liquidity without requiring traditional exit strategies or public offerings
• International directors receive full autonomy to build teams and operations according to local market conditions and opportunities

Competition Strategy Against Software Giants

• Odoo competes directly with SAP, Microsoft Dynamics, and Salesforce while maintaining the position that it has "no real competition"
• The competitive advantage stems from offering comprehensive business application suites at significantly lower prices than enterprise alternatives
• Point solutions like Slack, MailChimp, and Asana excel in single functions but cannot match integrated platform benefits
• Enterprise competitors are dismissed as "shitty, slow, and expensive" with poor user satisfaction despite market dominance
• The company targets SAP customers specifically, believing their current solutions are vulnerable to modern alternatives
• Product development focuses on staying "years ahead of competition" through concentrated development rather than feature parity

The competitive landscape divides between expensive, complex enterprise solutions and affordable but limited point solutions. Odoo positions itself as the only company successfully bridging this gap with comprehensive, affordable, and user-friendly software.

• SAP remains dominant in large enterprises primarily due to lack of viable alternatives rather than product superiority
• The recent SAP S/4HANA migration requirement creates opportunities for competitors as customers evaluate alternatives
• Microsoft and SAP have failed to create simple, affordable solutions despite having vastly larger development resources
• Odoo's focus on developer efficiency and product quality creates sustainable advantages over larger competitors with bureaucratic structures
• The timeline for displacing SAP is estimated at 10-20 years, acknowledging the complexity of enterprise software transitions
• Success in enterprise markets requires different sales methodologies but maintains the same cultural values and product philosophy

Common Questions

Q: Why does Odoo refuse to hire external managers or VPs?
A: External managers bring different cultural habits and cannot effectively improve teams they don't outperform individually.

Q: How does the company operate without budgets and forecasts?
A: Financial planning stays with the CFO while teams focus on execution, with responsible spending replacing bureaucratic approval processes.

Q: What makes Odoo different from competitors like SAP or Salesforce?
A: Comprehensive business application suite at €20 per user monthly, compared to expensive, complex enterprise alternatives.

Q: Will Odoo ever go public or sell to a larger company?
A: Never - the company commits to remaining private with secondary transactions every few years for investor liquidity.

Q: How does the open core business model work in practice?
A: Eighty percent of features remain free and open source while twenty percent require paid subscriptions for access.

Fabien Pinckaers built Odoo by consistently choosing unconventional paths over industry best practices. His commitment to product excellence and employee development created sustainable competitive advantages that traditional metrics often fail to capture.