Software company Odoo was valued at $5.3 billion in a secondary share sale.

Odoo, starting a startup sap In the enterprise software space, it raised its valuation to €5 billion ($5.3 billion) in a second equity round. alphabet‘s venture fund and Sequoia Capital.

The Belgium-based company develops open source enterprise resource planning software with more than 80 applications available on a platform that provides business tools for accounting, customer relationship management, human resources, e-commerce and website building. do.

Odoo CEO and co-founder Fabien Pinckaers told CNBC in an interview this week that his company doesn’t need to raise primary capital because it is “cash profitable” and growing revenue at a rate of 50% per year. More than a year. Enterprise resource planning (ERP) is “still a very fragmented market,” he said.

“The reason everyone fails (in this market) is because it’s so complex,” Pinckaers told CNBC. “Small businesses have complex needs, from accounting to inventory, websites, e-commerce and POS. They have many needs, no budget, and they need something simple and affordable.”

“No one has succeeded in doing both,” he added. “There are complex products like SAP that work well for large enterprises, but they are complex and expensive.”

Andrew Reed, partner at Sequoia Capital, said the market Odoo addresses “requires more setup time than most startups because the core systems are very complex and making them easy to use for small and medium-sized businesses and multiple countries is no small task.” He added: “

According to Reed, Odoo is “not a traditional Silicon Valley tech story.”

Pinckaers opened the company’s first office on a farm in Belgium 22 years ago. It was all he could handle at the time. Later, as the company began generating revenue, Odoo opened two additional offices in Belgium, which housed the company’s research and development, support, and technical teams.

The Pinckaers currently reside in India with their family. He has been living there for a year now, working to expand the company’s footprint, hire more staff, increase marketing and expand Odoo’s overall partner network.

Odoo recorded billings of €370 million last year and is on track to surpass €650 million in 2025. After that, the company hopes to reach €1 billion in billings by 2027. Billings — or the total amount of all bills for a particular year — is Odoo’s preferred metric for tracking annual revenue performance.

Currently, about 80% of Odoo’s business is open source software, with the remaining 20% ​​coming from paid licensed software, Pinckaers said. Open source refers to a type of software that gives users access to the underlying code (often free) to modify and adapt it.

Even though Odoo is now at an IPO-ready scale of business, Pinckaers said he is in no rush to take the company public. Rather, remaining private gives Odoo the flexibility to remain focused on investing over the long term, he said.

Odoo’s individual backers are also in no rush to list the company. Alex Nichols, a partner at Alphabet’s CapitalG, told CNBC he was not worried about “the timing of the IPO,” adding that factors such as public market conditions were ultimately “out of our control.”

The Pinckaers built their business to its current scale primarily by bootstrapping, that is, growing without external financing. Odoo has not had to raise primary capital from investors for the past decade, instead allowing early investors and employees to sell shares through secondary sales.

The last time Odoo secured primary funding was in 2014, when it raised $10 million in a Series B round. Before the recent second round, Odoo was most recently valued by investors at €3.2 billion.

Odoo’s other backers include private equity firms Summit Partners, Noshaq and Wallonie Entreprendre, all of whom took part of the stake as part of a €500 million investment announced on Wednesday. was sold to CapitalG and Sequoia.

Even after selling some of its shares, Summit remains Odoo’s largest institutional shareholder. Pinckaers himself has never sold any of his personal shares.