A vast amount of studies have shown how firms embracing the open innovation paradigm tend to improve their industrial and economic performance. Somewhat surprisingly, in such established background, few studies attempted to understand whether the open innovation benefits compensate its costs. To fill this gap, this article presents a novel theoretical framework composed of twelve propositions describing the main benefits and costs of inbound and outbound open innovation modes. Such theoretical framework was tested on a sample of 96 small and medium manufacturing enterprises. While most of the identified cost and benefit classes are acknowledged by the majority of the interviewed firms, most interviewees affirmed that their firms did not suffer from costs associated with the not-invented-here syndrome and with the potential loss of competitive advantage. The results of the study have implications for both firms and scholars, which are expected to lead to future researches.