Building Odoo's American war machine - Wilfried Juncker [Odoo]

0:00When I joined, we had 70 employees in the Americas. Now we are 1 ,000 in the US and another 800 in Mexico. So almost 2 ,000 employees in less than seven years. We don't hire any external manager, no team leader, no director, no manager. It has to be somebody who has an individual contributor. We want you to fail because we want you to be able to learn from it.

0:21Billions Host:Today on Billions, I'm sitting down with Wilfried Juncker. He's the managing director for Odooz Americas, a Belgian software unicorn that just hit$8 billion valuation. Under Wilfrid Watch, Odoo's Americas operation exploded from 35 people in 2016 to over 950 in America only. In this episode, we're digging into how Wilfrid built Odoo's American war machine, what it takes to conquer a new market from scratch, and how he's fighting high SMB churn while scaling at break-net speed. While SAP and Oracle charge millions for ERP, Odoo's open source model is democratizing enterprise software and Wilfried built the America's war machine that's making it happen.

1:02Billions Host:Wilfried, thanks a lot for being here. Thank you, Guillaume. That's amazing. I really love the story of Odoo. And you joined in the really early days. I think you were at around 10 million in ARR. Now the company is making more than 700 million. can you walk us through the early days of launching the US as Odoo was just a startup yeah I mean I think it's quite a lot to say on my end I joined 7 years ago which was the beginning of the launch but definitely a lot of people did a lot of work before me Odoo is such a special and specific company that promotes within so I joined as a partners manager working for the indirect team and then eventually really quickly became a team leader and a head of channel for the North America market and now I'm the director so I'm very grateful for what Udo has brought to us as far as the growth and yeah when I joined we have 70 employees in the Americas now we are a thousand in the US and another 800 in Mexico so almost 2 ,000 employees from 70 to 2 ,000 employees in less than seven years.

2:19It has been definitely a lot of interesting growth, as you guys can imagine. And yeah, I guess we can maybe talk a little bit about who do and why we're doing so well.

2:29Billions Host:Yeah, definitely. So what was the initial playbook when you entered the U.S. market? Because you mentioned you worked on channel partners. So how do you approach entering a market when you have the big guys closing most enterprise? The big players in the US are, of course, Oracle NetSuite, Acumutica came in a bit later. We have Sage, we have Epicor, Infor, Microsoft Dynamics, and of course, SAP. This is already a very well-established market. I mean, it's not like everybody already has an ERP in the US. or they have either an ERP or they have a lot of different systems, a lot of different single application use.

3:15For accounting, they use QuickBooks. For inventory, they use SwitchBall. For CRM, they use Hotspot. And all of these companies are looking for something a little bit more well-integrated. And that's where Odoo came in. Not only we had a large, very, very large scope because we are open source, but we also have an application that can be run into the entire business of a company from the CRM to the e-commerce with a website to an inventory system to an accounting and even manufacturing and inventory. So when we came into the market, it was a lot of convincing, really like hardcore convincing to to create a channel that was a decent channel that helped us to scale because that's how you scale a company these days of course we have half of our revenue who is with direct and the other half that is undirect we usually start with direct that kind of open the market and then when direct is good enough then we launch the undirect and that's what kind of happened.

4:22We kind of expanded the indirect seven years ago in North America. And the best way to do it is really to convince the partners by showing the software. I do do something that is very special is that we don't have BDR or SDR team. Everybody is required to do the demo. It's required to know how to demo the software from the person who just joined all the way to me. I'm still doing demos these days because I think it's important to remember how to promote, how to explain how the software work and try to touch point on the competitive advantage of our software because the needs can vary a lot. When you implement an ERP, you don't implement just a...

5:03And what I mean by an ERP, it's more like a business software platform, right? It's everything for your company. It's not just accounting or inventory. Sometimes it's going to go all the way to field services. It's going to go all the way to the manufacturing piece. And that's something very important to know how to explain. so because we are very generic there's quite a lot to to explain on there and and i'm quite curious

5:26Billions Host:like when um whenever you were like talking about channel partners so you enter a market you try to close the first deal find the first companies and eventually once a solution is established because you also have like a an open source model so people can take the software like build on top of it like do a lot of things on top of it like how exactly do you find the first partners and how do you maintain the relationship long-term like what's the advantage for them like do they get revenue share like how exactly does that work yeah um i think it's important to emphasize the open source model because it where it's we are the only real business software out there that have an open source model so we call it open core so we basically have the odoo community version that is available for free for everyone.

6:18And on top of that, we have developed Odoo Enterprise features that we charge to customers. And this is an excellent model where you want to promote your software. Today we have, for example, 15 million users, but 75 million users, or like half of them actually um are going to be focused on odoo community so there's basically a lot of customers who are not paying odoo but maybe in the future they will pay odoo because they will um they will basically use the odoo enterprise they would like to use at some point the odoo

6:57Billions Host:enterprise features um so you know like the the conversion rate from uh like the the free users the word paid user like down the line like what how much of the yeah is there to try because they are yeah because they are they are free right but what we know is that there is a pool of future clients that will come to us naturally uh and and on top of that there is also a free plan that uh 25 so it's 50 percent uh odoo community 25 free plan and then 25 enterprise users that are paying us. All of these free plans are also great because they are using Odoo Enterprise. We offer Odoo for, if you want to have a CRM and you have 100 users, you can use Odoo for free.

7:40You can go online, you go on a trial, you open, you add 100 users, you just add the CRM and you can use Odoo for free. Now, if you're going to use a second application, we're going to charge you the full amount. But it's a fairly unique kind of situation where we have 25 % of our Odoo Enterprise customers and users that are actually on a free plan. And so it's also a future reserve of customers. I think it's a little bit easier to capture from free to...

8:11Billions Host:Yeah. And from free to paid, how much do you think converts? Like... It's really hard. I won't be able to know like that. I think it depends on the modules. If somebody just... So, for example, in Europe right now, there is a lot of conversation about PayPal, the whole invoicing aspect of it. There is a lot of people who are just using Nodudu, who don't know Nodudu just for the invoicing because it's compliance now. In Belgium, it's compliance in France. It's going to be compliance in more countries in Europe. So people are just going to use the invoicing. But very, very quickly down to the line, if the sales rep...

8:52because he opened a trial, right? So, and we have a large sales team. If the server is good enough, he will be able to demo the accounting piece and maybe the sales. And therefore, it's not just a free plan. It becomes like a suite of business application that you need to use. So we're always trying to go that way where we don't force the customers to use all the application. We just offer the application to the mass and offer the code source. They can use what they want. And if they need more help to scale, we are here. We are here to help them to expand the scope of application. Usually the tactic of trying to be very transparent.

9:32We are kind of the only RPR there that put our price online. Like everything is very transparent that we do. And that's, I think, kind of an interesting aspect of it now.

9:43Billions Host:And do you think it's an advantage? Because you were mentioning that for the revenue part, 50 % of it is coming from the partners. so like yeah so is it is it like an advantage to have like the the pricing public even for partners because they can't really charge whatever they want they have to charge like the odus pricing essentially that's correct uh but there is there's a lot behind that i mean because it's open source you're gonna have because we have a very large range of industries and yes we provide a lot of out of the box features but there's also a lot of features that we don't have and that's where the partners came in they came with experience expertise of specific industries they create specific line of what we call modules which is the line of code that are changing the behavior of the out of the box features of hoodoo and because of that they can charge maintenance.

10:43So recurring business in the way of like they do the implementation, but because it's a project like that never really end, they're going to also charge the implementation and generate recurring revenue for the maintenance of what they have developed, their own expertise, basically, in top of the other structures. So that's one way.

11:03Billions Host:So for the structures, do you give back like a share of the revenue to the partners? Yeah. And on top of that, we give between 10 % to 20 % of commission to the partners. So there is this piece where they have a revenue aspect of it, the commission, there is the maintenance, and of course there is the whole implementation, which is not an easy task to change from sometimes three, four software to one single software. So you have a lot of user training, a lot of understanding of the scope, trying to redefine the processes with the customers, and then go into a traditional implementation where you have to do the data migration and user testing and all of that.

11:43Billions Host:So how exactly did you find those channel partners to be able to sell Odoo? How do you convince the first one in the US? Yeah, I mean, when I arrived, we already had a few. So I was not the first one, but definitely I went into the situation when I had to explain what was Odoo. and that was very different, right? Because for our partners, if they're going to invest in the technology, they're going to go all in. I mean, they're going to spend a lot of time learning about, you know, 12, 15 million lines of codes and they're going to have to understand how Odo work. So there is the aspect of the brain awareness that we are trying to build with marketing and we can point on that a little bit later.

12:29But there is also the aspect of what is the key differentiators in the US market. And for us, it was, of course, the open source aspect because we are the only one open source software who truly is open source. You can type on GitHub, you can see the enterprise, you can see the line of code. There is a lot available out there. And then there is the other aspect of the transparency regarding renewal, regarding contract. we are in a space where it's not the most transparent as far as the pricing, as far as the renewal clause. Everything is online on our end. So the legal aspect, the price and all of this.

13:10So rather than having a conversation regarding how much Oudu is, we went into what is Oudu. And we went into the relationship we can build with partners. else we went into this developing the sentiment that we're gonna be it's gonna be a core effort of building something together um and and then is what i usually try also to push and i fortunately not when i joined it was like we were already kind of growing and so there's the mention of like there's a train there's a fast train going do you want to be in that train or do you want to take the next train um and so that was that's what has been the case for the last seven years and yeah i mean when i joined we were just in the us alone uh we had like 30 40 partners now we have more than 500 so we we 10x the number of partners and you have to imagine that these partners have their own sales team they do marketing they have their own implementation and they go out there and trying to push odoo because they if they sell odoo they sell a project and they can make recurring revenue as well.

14:17Billions Host:So it's definitely not strong. It's like sales team that is everywhere. And usually like these partners, were they already like established companies or were they like, you know, in the beginning, in the early days, maybe like two or three and then they scaled? And the reason I'm asking is because were you basically like poaching, you know, like Oracle or ASAP, you know, like partners or what was the strategy essentially? Yeah, I mean, I think we play a lot and it's interesting because we are in that space where they are an independent company, right? They can choose to work with Oracle, NetSuite, Salesforce, whatever they want.

15:00And you have two approaches here. You have the approach of being the partners, the vendors, the editors that are forcing them to just work with you. you only need to work with me and if you go with the competitor I'm down with you I don't want to work with you anymore you have this approach of trying to harm them and I don't think it's the approach of voodoo and we always have to do the opposite approach where it's like we want to be judged on the features of our software and the relationship that we have with you so it's okay if you go with somebody else as long as we have a common agreement that, you know, if I work with you on a deal, we try to go all the way to the end, right?

15:46You don't just go to be in the middle of it and try to, oh, I also do another software. But other than that, it has been very beneficial for us to be transparent and be, yeah, more than just transparent, be very honest with the partners, telling them, like, we are okay if they do multiple technology. That's not a problem. But they need to just make sure that they don't defocus themselves. If you have a partner that has only 20 employees and is starting to do SAP, Oracle, and Odoo, it's a big defocus. They won't be able to absorb the knowledge of three of the software. So that's also trying to be very honest with them.

16:27like how are you going to be able to recruit the right talent, elevate this talent, being able to be more efficient when you talk to a customer. All of these kind of things are important discussion to have with them because we are not only the software vendor, but we also try to advise them on how to scale their company. Because we see companies that start from zero to now have 200 employees, but we also see companies that have been at 20 employees for the last 10 years because they don't know how to scale So we try to kind of advise them on the best way to scale this partnership.

17:03Billions Host:So within the Odooz team, you have someone who's basically doing like partner management and they also try to help them like get more customers and scale the agency. So here in San Francisco, we manage apart almost the whole channel, I mean, except Peru, Chile and Mexico and Colombia. So we have a hundred and I think around 130 people who do partnership, so who manage the partners, who recruit the partners, who assist the partners into the effort of scaling their company. so we really try to make sure that we are here to assist them and that's the best way to do it because if you if you stack 200 partners into one person this person is only going to focus on the top 10 percent and the rest of them they're never going to talk to so we try to really try to have like a partnership manager for between five to 15 partners that's the ratio and the question i have is like you were mentioning, you know, that you went from essentially like 70 people to 2000 people in America, like in under like 10 years, which is quite insane.

18:25Billions Host:So that means you have to hire like really fast. I think like the other day, whenever we were talking, you know, there is this kind of like joke in San Francisco about Odoo being kind of like the training camp etc for hiring so how exactly do you find talent, attract them and also make sure that they don't jump on another company I think it's definitely interesting to be in that situation where the Odoo Odoo have a very strong culture. So it's a lot about meritocracy and it's a lot about promotion with him. So we don't hire any external manager, no team leader, no directors, no manager. It has to be somebody who was an individual contributor.

19:16And we have maintained this since, I mean, the last 10 years. It's definitely very interesting to see that now you talk to any director, in anybody who has been in a company, they were at some point individual contributors. Maybe they were a business system analyst. Maybe they were somebody who worked in customer success. So like me, who worked as a partners manager. And so definitely there's this culture of like, you do well, you will be rewarded

19:48Billions Host:by going up into the hierarchy. Because we are not going to put a manager that came from another company in top of you. And so that's a big sales because we have actually a leading proof and just me, a lot of managers here at Udo Inc. and anywhere else where it's like, well, I was there three years ago. Now I'm the manager and we are constantly creating new teams. Like these years, we are creating an entire outbound team. That's going to open a lot of new roles management roles for individual contributors. And so that's the best way for us to, I started the opposite, to retain people, is to showcase the growth and showcase the trust that we have into the employees.

20:36Regarding the recruitment, we try to depend on the market, but we try to hire people with a little bit of experience in either sales, software, or specific industry. Somebody who have worked a lot in a specific industry could be a great fit to, even if they didn't work in tech, could be a great fit to bring their knowledge. And we are the one who bring the tech. So we have a full onboarding program. For salespeople, it's around three months. But for BSA, it's around more like six months. And we're basically trying to teach them as much as possible into Odoo. In Odoo, regarding the features, regarding how to sell Odoo, how to support customers.

21:18And so we have developed that for the last 10 years, a program that is really you don't know what to do, that's not a problem. You know a little bit about sales, you know a little bit about an industry, a little bit about tech, that's enough. We're going to just put you into a specific mode where you're going to be able to be productive very quickly on. And that has been the case for a very long time now.

21:40Billions Host:Can you maybe explain the different steps during the three months? How is it split? When do you start talking to customers? Etc. The first three weeks are going to be general onboarding, of course about the company, but mostly going to be about the basics of the software, how to use the software internally. The good news is we use UDU.com as our main software for pretty much everything. So it's like if you learn about UDU, you also learn about the way to use the software internally. So it's going to be a lot about the usage of the software. And then you're going to have, for the salespeople, you're going to have a series of demos that they have to do in front of their manager and team leaders until they don't succeed how to demo the product.

22:32And we have a use case. So for example, I'm a manufacturer. I need XYZ. And they have to do a specific demo to the manager. and you go to six, seven demos that they have to do. And once every week, they have to prepare the demo. And on Friday, Thursday, they have to demo it to that cemetery manager. And if they pass, then they go to the next. And we try to vary the industry. We try to vary the modules, the application. So they have a bigger range of like, okay, I can do pretty much everything. I just need to understand what the customer needs. I need to understand what is the industry, KPI, the industry terminology.

23:12And then I can prepare a demo and then I can push AirPrint Compose to our customers. So which, because again, because we are open source, we have touched on so many different industries that at this point, it will be, especially on the first few months, it will be hard to just put them into one specific box. We want them to have an open mind and then to try to do so. So for the first, yeah, so for first three weeks, then there is a few weeks of demos. But after one month, one month and a half, we open the pipeline and they are starting receiving leads. And we want them to right away go into conversation with their customers.

23:51Of course, there is a team leader. We have a specific onboarder that can assist them. But we always are in a situation like we want you to fail because we want you to be able to learn from it and be better at it in the next time, you know? So it's a little bit about, yeah, it's okay to fail, but we want you to be better after that, yeah.

24:12Billions Host:I think what's interesting in the ERP is like, as you mentioned, you have a lot of industry, a lot of use cases. So it's very like, I think it's hard when you don't know all the industry, et cetera. So how exactly, as salespeople are going into the role, do you give them like specific industries because you realize, let's say, one guy or one girl, they're killing it in the healthcare industry. So whenever you're rooting leads, if it's healthcare, you push it directly to the one who has the highest closing rate in a specific industry. Or how exactly does that work? Yeah, so right now we are working on a split by industry, but it's a little bit like it's coming up.

24:57What we have done is a split by size of business, which it's already something very important for us because we have in Odoo Inc. We have more than 200 people working through Excel. So there is a split regarding micro business with one to five users and then five to five to 50. And the five to 50 are going to be more complex needs, more complex requirements and so on. Now, there's something that is happening also as team leaders, a manager sometimes receive inbound lead because people reach out on LinkedIn or mainline or whatever. Then definitely when they receive the lead, they evaluate who is the sales rep who sells the best on a specific industry and they try to match.

25:45But it's something we are working on because we believe that the size is important. Of course, the industry is important. And at some point, the geographical area. So we have reps in Buffalo, New York. They work on the East Coast because, yeah, at 8 a.m., they can be awake and they can assist the customers. We have reps in Pacific here in California and SST. So as we grow, we are going into these kind of details. But we are, of course, seeing this as a very important kind of strategy to do.

26:20Billions Host:And you mentioned the different company size. for Odoo I mean you are like really well known for targeting also like SMBs and having a bit larger companies but SMBs are like really well known for high churn and we're seeing this also you know like at Lemlist our strategy typically has to be to really like go up market to drastically reduce churn and get like net retention over 100 % in your case when we were chatting like the other day, like you still maintain like strong growth and still focusing, you know, on this like small account. So how exactly do you balance focusing on or like serving, I would say, like smaller accounts and at the same time keeping growth when you know that they're gonna, they have a high likelihood to churn?

27:13Yeah. Well, I think Flutterful is important to understand that today in the world, we have more than 10 ,000 new companies signing up on Udo from our sales subapplication, from our pricing page. So we don't even talk to them. They go and they purchase Udo. So, of course, that put us in a situation where we have a very large amount of volume. And that may be customers that are only going to try one month and then churn, right? So we understand that. So we have to manage the volume in multiple ways. we have to manage the volume in terms of customer account and so that goes into a customer care team that manages a thousand accounts.