Very well written article. Why are VCs very interested in FOSS companies
Probably because they have market share but don't generate any revenue.
I wouldn't invest in open-source companies, even though I ran one
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Re: I wouldn't invest in open-source companies, even though I ran one
#52If engineers are the most important resource, I think being a company known for open source might act as an inbound sales for attracting top talent, too (see: Google, RedHat, Mozilla).
For engineers, it makes sense to work for companies that do have FOSS projects because they can always point to their corpus of work when switching between jobs as proof of their worth. Most engineers who realise this don't ever want to go back to working full time on closed source projects.
That said, folks making arguments against open source companies conveniently ignore the examples of Cloudera, Linaro, Hortonworks. They also tend to forget how much central open source is in the current climate because someone or the other will attempt to commoditize your core (Firebase vs Supabase, GitHub vs GitLab, Oracle vs Postgres, Docker vs Mesos, Windows vs Linux, Intel/AMD vs ARM, S3 vs MinIO, Symbian/iOS vs Android, Plaid vs Moov.io) and because of the Interwebs, these FOSS solutions will be found and a community will develop around it. It is almost inevitable.
I'm not an investor, but one should definitely invest in FOSS companies with proven tech because they attract the most precious commodity of all, developer mindshare. I'm sure FOSS companies will discover newer ways to make their businesses work (like GitLab and HashiCorp with "buyer-based open core"), and blueprints from the past are already available (especially, in terms of what not to do; looking at you, Docker). Despite what they may say about BigTech stealing their thunder away... I think it is mostly down to FOSS companies digging themselves into a hole.
Source-available licensing is a compelling alternative, but I hope the community rejects it, because such licenses don't seek to truly benefit the overall software ecosystem rather only merely appear to do so, and that's why I hate those.
Required reading:
http://dtrace.org/blogs/bmc/2018/12/14/open-source-confronts...
https://www.gwern.net/Complement
https://blogs.apache.org/foundation/entry/the-apache-way-to-...
Re: I wouldn't invest in open-source companies, even though I ran one
#53This is unusually insightful for a LinkedIn post. One question, though: towards the end, it suggests that GPL/AGPL products, which are more defensible against commercial competitors who simply resell the open source project, are "legally murky" and might be rejected by customer legal teams. But does that matter? Can't you just do what Sleepycat did, and offer commercial customers a clean commercial license?
> One question, though: towards the end, it suggests that GPL/AGPL products, which are more defensible against commercial competitors who simply resell the open source project, are "legally murky" and might be rejected by customer legal teams. But does that matter? Can't you just do what Sleepycat did, and offer commercial customers a clean commercial license? It isn't an issue of "clean"; GPL/AGPL aren't "legally mu…
It really depends on what you're selling. All of the Linux core tools and the kernel are released under GPL and obviously companies have no issues using them. For libraries that are statically compiled or used as part of your own software it's a different story though.
Re: I wouldn't invest in open-source companies, even though I ran one
#54Earlier quoted context omitted.
> But we've paid a high price. What price?
Everyone using BSD and Apache licenses - so any changes or improvements they make aren't contributed back to the source repo.
Have a look at PostgreSQL, SQLite, LLVM, Clang ... all these are projects that get a lot of support from proprietary software vendors. I'm pretty sure that the companies contribute to these projects because of the liberal license, not in spite of it.
I think a big fallacy with regard to the GPL is that companies don't contribute to open source because the license forces them to. Companies contribute to open source because it makes more sense to collaborate on some projects rather than each work on their own.
Licenses like GPL etc. are great for ensuring their user's freedom; but they don't really incentivise companies to contribute to them at all. Instead, they prevent some companies from using them. So counter-intuitively project with liberal licenses end up with much more contributions than projects with strong licenses...
Re: I wouldn't invest in open-source companies, even though I ran one
#55Earlier quoted context omitted.
Everyone using BSD and Apache licenses - so any changes or improvements they make aren't contributed back to the source repo.
Well, there are also many who want to contribute code back to GPL and LGPL projects, but can't because the companies that control these projects want them to sign contributor agreements with unacceptable terms.
According to GPL, you do not need to contribute back to the original authors, you only need to make your changes available under GPL.
But maintaining a fork is not everyone's cup of tea.
Re: I wouldn't invest in open-source companies, even though I ran one
#56The sad thing is so few companies really invest in participating in FOSS software. That’s one reason these “open source companies” came to exist. It really should be a community of contributors, backed by a diverse set of companies. At best, employers will allow contributing bug fixes or small patches. Not the in depth dedication these projects really need. We’re heading towards a handful of giant companies that can…
> We’re heading towards a handful of giant companies that can afford to pay large teams to build and maintain FOSS, and hence own developer mindshare, for their own selfish reasons. Can you name some examples of such "selfish reasons" connected to some OSS? I can think of Google taking over the internet with Chrome, but MS did the same with IE, so that has nothing to do with OSS. It's more that Chrome happens to have…
Gradually, more and more of Chrome will become closed source as is already happening. DRM, Sync features,...
Re: I wouldn't invest in open-source companies, even though I ran one
#57Earlier quoted context omitted.
Lovely landing page – there seems to be a sudden abundance of google analytics alternatives by small teams and indie hackers in the last year, any insight into why that is?
Hmm due to the cookie banners probably. I've started this as a side project for my personal website, without looking for existing solutions :D The landing page is... meh, a placeholder more or less right now.
That kind of makes sense, the cookie banners have been around quite a while now though.
Re: I wouldn't invest in open-source companies, even though I ran one
#58Earlier quoted context omitted.
Well, there are also many who want to contribute code back to GPL and LGPL projects, but can't because the companies that control these projects want them to sign contributor agreements with unacceptable terms.
According to GPL, you do not need to contribute back to the original authors, you only need to make your changes available under GPL. But maintaining a fork is not everyone's cup of tea.
> But maintaining a fork is not everyone's cup of tea.
It is not in the interest or benefit of the community if everyone makes or is forced to make his/her own fork. Forces should be joined, not scattered.
Re: I wouldn't invest in open-source companies, even though I ran one
#59I'm working on an "open core" knowledge base [0] right now and have been for the last few years. We're definitely leaving money on the table by offering an easy docker install option and I'd largely agree with the points made in the article but it's hard to understate the value of the distribution that open source brings, particularly for product-lead teams that aren't so hot at marketing. [0] https://www.getoutline.…
If the software fits into the 'infrastructure' bucket then open source software seems like the best approach for selling into engineering orgs. This is likely due to the longer setup/eval time for infrastructure type software (Elastic being an example) and the higher price tag (justified or not).
Contrast this with 'tools' (such as IDEs) which tend to not be FOSS and are a low enough dollar and time cost that they can easily be purchased or even trialed for a month.
My very brief review of your product site leads me to think that a good approach for your company would be to offer small-team licenses for free with the hopes that they will adopt and become champions for their enterprise to buy a site license.
Re: I wouldn't invest in open-source companies, even though I ran one
#60The sad thing is so few companies really invest in participating in FOSS software. That’s one reason these “open source companies” came to exist. It really should be a community of contributors, backed by a diverse set of companies. At best, employers will allow contributing bug fixes or small patches. Not the in depth dedication these projects really need. We’re heading towards a handful of giant companies that can…
A community of contributors backed by a diverse set of companies has to be seeded by an MVP. Where would that MVP come from? For complex software it's either an internal project spun out from a unicorn or a labor of love from a gentleman hacker. These are pretty limited routes; it's much easier to start an open source startup with the caveat that the community will probably never emerge later because the startup will…
The term "open source" has a well-known definition, and the "novel licenses", like Mongo's, do not match it. They are more like the "source available" licenses, as practiced by MS in 1990s, and by IBM, much earlier.