Open-source infrastructure is not venture-backable • Hacker News Board

Re: Open-source infrastructure is not venture-backable

#81

Post by acpmasquerade » Sat, Jan 16, 2016, 4:39 AM UTC

hwestbrook wrote: post #24

Seems as though she undermines her whole point with the "Here’s what is true about the “open source is really well funded” myth" section. The open source projects that people/businesses really care about are funded. Isn't a non-funded open source project just one an open source project that no one really cares about? I think there is a really subtle line that she has missed by assuming all open source projects develo…

Offering and maintaining an open source project is subjective whereas the classification is objectifying the overall philosophy.

Re: Open-source infrastructure is not venture-backable

#82

Post by infinite8s » Sat, Jan 16, 2016, 5:55 AM UTC

marvy wrote: post #77

shawn-furyan wrote: post #66

Earlier quoted context omitted.

It's not surprising that compensation and perks of non-profits converge with those of for-profits in the same industry. They are hiring from the same talent pool. Also, at the margins, I tend to think that perks allow organizations to hire more cheaply than wage increases.

> perks allow [hiring] more cheaply than wage increases That sounds like the kind of thing some bored economist must have done some kind study on at some point. I'm too lazy to look for it, so maybe someone else can volunteer. I'll just say that sounds very likely to be true.

Doesn't even need an economic study. Just some back of the envelope math. Free daily lunch would probably be about $10-$15 per person (especially if ordered in bulk). There are about 250 working days a year (50 weeks * 5 days) so that's only an extra 4k a year in expenses (and perks can be written off as a business expense and not incur income tax expenses). Free daily lunch sounds much better as a perk than a few extra grand salary.

Re: Open-source infrastructure is not venture-backable

#83

Post by vanattab » Sat, Jan 16, 2016, 5:57 AM UTC

sarciszewski wrote: post #29

dzdt wrote: post #2

Bad headline. Article is about identifying open source infrastructure tools as an overlooked category for venture capital funding.

Thank you for that spectacular TL;DR. No rational investor wants to invest in something that will absolutely not give them a return. Most open source infrastructure tools lack a business model to capture revenue from its users. So one of several things will have to happen in order for open source infrastructure to get funded: - Investors will part ways with their money, full knowing that they will not see a return. (…

Based on my experience as a government contractor I have to say I think the government taking taxpayers money and funding open source infrastructure would be a terrible idea. What the government should do however is release all software it develops or pays to have developed from scratch as FOSS excluding sensitive defense systems and the like of course.

Re: Open-source infrastructure is not venture-backable

#84

Post by infinite8s » Sat, Jan 16, 2016, 6:00 AM UTC

jondubois wrote: post #69

I don't know anyone who has raised VC funding for an open source project. The most surprising example of this for me is Socket.io ( https://github.com/socketio/socket.io ) - This is a hugely popular open source project; but it was never able to get funding on its own merit - To the VC world, it was always seen as a 'side project' of another startup - Not as a fundable project in its own right. The archnemesis of open…

That's only true if you discount or ignore the time cost of requiring an internal engineer to manage those open source systems. A lot of the reason to use external services is to mitigate the operational cost (which can be amortized across all the service's customers), since presumably that systems isn't a core competitive advantage for the company.

Re: Open-source infrastructure is not venture-backable

#85

Post by manigandham » Sat, Jan 16, 2016, 6:24 AM UTC

jondubois wrote: post #69

I don't know anyone who has raised VC funding for an open source project. The most surprising example of this for me is Socket.io ( https://github.com/socketio/socket.io ) - This is a hugely popular open source project; but it was never able to get funding on its own merit - To the VC world, it was always seen as a 'side project' of another startup - Not as a fundable project in its own right. The archnemesis of open…

How does funding services require that others adopt those services? Weigh the costs and use what's best for your business.

Software on it's own isn't a service, there will always be a business case for someone else to do the "hard work" and just run it for you.

Re: Open-source infrastructure is not venture-backable

#86

Post by ageek123 » Sat, Jan 16, 2016, 6:30 AM UTC

jondubois wrote: post #69

I don't know anyone who has raised VC funding for an open source project. The most surprising example of this for me is Socket.io ( https://github.com/socketio/socket.io ) - This is a hugely popular open source project; but it was never able to get funding on its own merit - To the VC world, it was always seen as a 'side project' of another startup - Not as a fundable project in its own right. The archnemesis of open…

It's totally untrue that VCs are "funding services exclusively." Just within the Hadoop/Spark ecosystem there are Cloudera, Databricks, Hortonworks, Tachyon Nexus, and others. In storage there's MongoDB, Couchbase, Cockroach Labs, etc. In every infrastructure area there are many very significant VC-backed open-source companies.

Re: Open-source infrastructure is not venture-backable

#87

Post by agibsonccc » Sat, Jan 16, 2016, 6:42 AM UTC

There seems to be a lot of confusion around open source projects vs companies.

There are plenty of for profit companies around open source software that are venture backed:

Mesos(mesosphere)

Spark(Databricks)

Flink (Data Artisans)

Zeppelin (NFLabs)

Scala (typesafe)

Linux (Red hat)

Hadoop (Horton, Cloudera, MapR)

Elasticsearch (Elastic)

PredictionIO (PredictionIO Inc)

Meteor (Meteor Inc)

Deeplearning4j (My company skymind)

RethinkDB(RethinkDB inc)

Redis (Redis Labs)

Wordpress(Automattic)

Drupal(Acquia)

Docker (docker inc)

Coreos (coreos inc)

NGINX(nginx inc)

and the list goes on!

Acquired companies also include springsource (VMWare) , jboss (redhat), and ansible (redhat)

Lastly, there's open source from companies such as facebook where the goal is likely hiring. By open sourcing internal tools, it's easier to onboard new devs for recruiting. If you like their tools why not work there?

The key distinction people are missing is that these companies don't monetize open source directly. Instead open source is used as a means of building a user base that will indirectly generate revenue in other ways such as support, licensing solutions around or on top of the software (open core), or through some form of consulting.

FOSS such as the GNU software is a different beast where the goal isn't profit.

I think the confusion is: we can all use the software provided by these companies for free (depending on the context/license) without paying them and contribute back in other ways such as bug reports and the like.

The other thing here is individual devs monetizing their singular github repos. There's no reason you can't charge for support or consulting. Radim @ gensim does exactly that and he does fine.

Just because you can git clone a repo doesn't mean you can use it effectively. You typically seek support via community or commercial. There's no reason both can't exist and they both do.

I hope that helps a bit!

Re: Open-source infrastructure is not venture-backable

#88

Post by ageek123 » Sat, Jan 16, 2016, 6:54 AM UTC

agibsonccc wrote: post #87

There seems to be a lot of confusion around open source projects vs companies. There are plenty of for profit companies around open source software that are venture backed: Mesos(mesosphere) Spark(Databricks) Flink (Data Artisans) Zeppelin (NFLabs) Scala (typesafe) Linux (Red hat) Hadoop (Horton, Cloudera, MapR) Elasticsearch (Elastic) PredictionIO (PredictionIO Inc) Meteor (Meteor Inc) Deeplearning4j (My company sky…

> The key distinction people are missing is that these companies don't monetize open source directly. Instead open source is used as a means of building a user base that will indirectly generate revenue in other ways

This isn't a distinction, it's the definition of open source. By definition if you have an open source company, you're making money through some channel other than keeping the software proprietary and selling binaries of it. So your list quite rightly invalidates the author's claim--it's not just some subtle distinction that was ignored, it's proof that you can indeed make money from open source software.

Re: Open-source infrastructure is not venture-backable

#89

Post by agibsonccc » Sat, Jan 16, 2016, 7:23 AM UTC

ageek123 wrote: post #88

agibsonccc wrote: post #87

There seems to be a lot of confusion around open source projects vs companies. There are plenty of for profit companies around open source software that are venture backed: Mesos(mesosphere) Spark(Databricks) Flink (Data Artisans) Zeppelin (NFLabs) Scala (typesafe) Linux (Red hat) Hadoop (Horton, Cloudera, MapR) Elasticsearch (Elastic) PredictionIO (PredictionIO Inc) Meteor (Meteor Inc) Deeplearning4j (My company sky…

> The key distinction people are missing is that these companies don't monetize open source directly. Instead open source is used as a means of building a user base that will indirectly generate revenue in other ways This isn't a distinction, it's the definition of open source. By definition if you have an open source company, you're making money through some channel other than keeping the software proprietary and se…

Well that depends. You can make money from open source. It more comes down to HOW which is rather than licensing code or subscription licenses BECAUSE the software is closed.

I agree at what you're getting at though.

Re: Open-source infrastructure is not venture-backable

#90

Post by lmeyerov » Sat, Jan 16, 2016, 7:26 AM UTC

ageek123 wrote: post #86

jondubois wrote: post #69

I don't know anyone who has raised VC funding for an open source project. The most surprising example of this for me is Socket.io ( https://github.com/socketio/socket.io ) - This is a hugely popular open source project; but it was never able to get funding on its own merit - To the VC world, it was always seen as a 'side project' of another startup - Not as a fundable project in its own right. The archnemesis of open…

It's totally untrue that VCs are "funding services exclusively." Just within the Hadoop/Spark ecosystem there are Cloudera, Databricks, Hortonworks, Tachyon Nexus, and others. In storage there's MongoDB, Couchbase, Cockroach Labs, etc. In every infrastructure area there are many very significant VC-backed open-source companies.

The Spark companies are services companies of all flavors. (Interestingly, a lot of drama around their later-stage treatment of open source vs. paid, but I won't get into that here.)