THE LOW­EST-COST ERP?

CRN - - COVER STORY -

Mum­bai-

based Web Notes Tech­nolo­gies is ex­pect­ing to close FY2013-14 with rev­enue of ` 45 lakh.

While this fig­ure looks small, Rushabh Mehta, Founder-Direc­tor, points out that even with this rev­enue the com­pany is able to pay a seven-peo­ple team and make some profit.

When in 2009 Mehta de­vel­oped the first ver­sion of his prod­uct, ERPNext, he saw that the ERP mar­ket was very frag­mented and highly com­pet­i­tive. “If you ig­nored the top play­ers such as SAP, Mi­crosoft and Tally there were thou­sands of play­ers who were ey­ing mar­ket share.”

He re­al­ized that it would be al­most im­pos­si­ble to suc­ceed in a mar­ket which was fast evolv­ing, so he took the bold step of giv­ing away the soft­ware for free. “Open source is the smartest and cheap­est way to mar­ket your soft­ware. An open source ERP cre­ated waves, and peo­ple started tak­ing in­ter­est in us.”

Ini­tially the com­pany fo­cused only on paid sup­port, but later also launched a SaaS model. “We give our soft­ware for free, so any­one us­ing our soft­ware can also com­pete with us. How­ever, cus­tomers come to us be­cause they rec­og­nize us as cre­ators of the in­tel­lec­tual prop­erty.” ERPNext is built us­ing Python, Apache and MySQL.

Ap­prox­i­mately 70 per­cent of the rev­enue of ERPNext comes through SaaS and the rest from paid sup­port. “Our li­cens­ing cost, which can be as low as $6 per user per year for a com­pany hav­ing 100 users, is per­haps the low­est in the world for a hosted ERP.”

Mehta says open sourc­ing his prod­uct was the best de­ci­sion he has taken. “To­day we have cus­tomers across 44 coun­tries. A seven-mem­ber In­dian ERP com­pany could not have gained so much trac­tion if we had cre­ated a closed source model.”

Ac­cord­ing to Mehta, the big­gest ad­van­tage of go­ing open source is that they could build new fea­tures faster. “We have 500 devel­op­ers on our mail­ing list, many very pro­fi­cient, spend­ing sev­eral hours ev­ery week con­tribut­ing fixes, bugs and even new fea­tures, but not tak­ing any re­mu­ner­a­tion. That’s the big­gest ad­van­tage as we are able to go to mar­ket with new fea­tures faster.”

Our li­cens­ing cost, which can be as low as $6 per user per year for a com­pany hav­ing

100 users, is per­haps the low­est in the world for a hosted ERP

RUSHABH MEHTA

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