There was another acquisition involving open source software recently when Consona bought Compiere, but what is perhaps most striking about the deal from an open source software perspective is how little it and the Compiere community mattered in the deal.
By most accounts, including that of fellow open source ERP player xTuple CEO Ned Lilly, who offers an interesting and accurate depiction of Compiere’s changes, acknowledge the movement away from community that occurred over the last few years at Compiere. As discussed in our own recent report on the deal, we are also somewhat skeptical over the fate of what is left of Compiere’s open source community, even though Consona plans to continue offering both paid and free versions. At the same time, we are also wondering whether it will matter much — to Consona, to Compiere or even to its customers?
So how does this jibe, or not, with our views on how M&A deals and valuations involving open source software vendors tend to highlight the value of open source communities?
Community has served to drive up the price in deals stretching back for years (Citrix-XenSource for $500m, August 2007; Nokia-Trolltech at $153m, January 2008; Sun-MySQL for $1 billion, January 2008; VMware-SpringSource $420m, August 2009), but the reality in the case of Consona-Compiere (price not disclosed) is that community, or lack of a vibrant open source software community, may have actually driven the price down.
We must also consider the significance of cloud computing here. Cloud capabilities and possibilities in the enterprise version of Compiere’s platform may have trumped community in this case, but the deal still serves to remind open source software companies, as well as their existing and potential partners and acquirers, that community counts.
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