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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

#111

Post by Closi »

gregwebs wrote: post #97
alfonsodev wrote: post #84

Earlier quoted context omitted.

This is a good point, any examples that come to mind to illustrate it? I’m genuinely interested.

Many successful databases are open source. MongoDB (at least before the recent license change!) is a good example of a huge company where I doubt anyone would have made a noticeable business out of a proprietary version of the product.

I actually think MongoDB highlights the challenges in this article. Namely:

- Tremendously popular database, a huge success by open source standards!

- Their open-source API has been used by Amazon to create their biggest competitor (DocumentDB). Or alternatively any cloud provider will help you spin up pre-built images with MongoDB installed (no path to monetisation).

- Have not (yet) been able to turn it into a profitable business, with large (and widening) losses recorded the last 3 years (at what appears to be the height of it's popularity).

- To create revenue they need a huge sales team (I've heard the pitch and seen the cost!). They not only have to bid against competing technologies, but also their own free tier!

- This resulting in... Mongo having to change their licence to create a profitable business.

23.15B market cap though - but they have had to ultimately change their licensing plan to find a profitable way forwards.

Re: I wouldn't invest in open-source companies, even though I ran one

#112

Post by jedberg »

mooreds wrote: post #105
jedberg wrote: post #61

Same. I've very wary of investing or getting involved with any company that has an open source strategy. I worked for one (Sendmail) and it did not go well. We talked about how it's hard to compete when your number one competitor is your own software for $0. If you look at successful public companies with open source, they are all fairly small successes compared to their public closed source peers. When I worked at r…

> The biggest benefit was being able to show people the code when they suspected shenanigans. This is very interesting to me. How was that a benefit?

It helped shutting down rumors or runaway conspiracy theories. You know how reddit can get when they have an idea in their head, wrong or not.

Re: I wouldn't invest in open-source companies, even though I ran one

#113

Post by bitwize »

ignoramous wrote: post #52

If 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 t…

Let's face it, a tech company's most important resource is one of two things:

* its IP

* the data it's collected on its users

The first precludes open source within the company's core competencies. The second makes the company a place where talented, morally decent engineers wouldn't want to work.

Re: I wouldn't invest in open-source companies, even though I ran one

#114

Post by tinco »

mooreds wrote: post #103
hapless wrote: post #90

The author makes a good case against open source businesses, but he indulges himself in a false dichotomy between a traditional proprietary model and open source. Increasingly often, there is no market for your proprietary software. It is then not a choice between open source and proprietary models, but rather between doing open source or doing nothing. A lot of markets are just gone , and they're not coming back. Od…

This is a really good point. However, there are still successes that I'd never have expected. Jetbrains is a good example. Who would have thought that an IDE could be sold when there are adequate ones for free? There are also many many smaller niches where software can be sold because there isn't adequate developer interest to create OSS. One example is this: https://querix.com/products/lycia (not a customer, just ra…

I did, there's never been really good community driven open source IDE's. For every community driven IDE I can name you an enterprise driven IDE that's popular and arguably better.

Code editors are a product where polish has high value, and users are willing to pay for that polish. I don't particularly care if my editor is open source as long as it's got strong community and great polish.

Re: I wouldn't invest in open-source companies, even though I ran one

#115

Post by mooreds »

jedberg wrote: post #112
mooreds wrote: post #105

Earlier quoted context omitted.

> The biggest benefit was being able to show people the code when they suspected shenanigans. This is very interesting to me. How was that a benefit?

It helped shutting down rumors or runaway conspiracy theories. You know how reddit can get when they have an idea in their head, wrong or not.

Ah, so in general useful for helping customer service. I could see that being helpful for many developer focused services, but definitely for the reddit community I bet it assuaged some concerns.

Thanks!

Re: I wouldn't invest in open-source companies, even though I ran one

#116

Post by keyle »

mooreds wrote: post #103
hapless wrote: post #90

The author makes a good case against open source businesses, but he indulges himself in a false dichotomy between a traditional proprietary model and open source. Increasingly often, there is no market for your proprietary software. It is then not a choice between open source and proprietary models, but rather between doing open source or doing nothing. A lot of markets are just gone , and they're not coming back. Od…

This is a really good point. However, there are still successes that I'd never have expected. Jetbrains is a good example. Who would have thought that an IDE could be sold when there are adequate ones for free? There are also many many smaller niches where software can be sold because there isn't adequate developer interest to create OSS. One example is this: https://querix.com/products/lycia (not a customer, just ra…

Yep IntelliJ is great. I remember back in the days, changing from Microsoft visual studio with resharper to eclipse. Hurrrr what a pain. Then you'd try something else, have to reconfigure everything, never happy.

Then I discovered the makers of resharper made an IDE which supports tons of languages and never looked back.

As long as they don't fuck it up like Adobe fucked photoshop (and every product they own), they'll have my money.

Re: I wouldn't invest in open-source companies, even though I ran one

#117

Post by tinco »

hapless wrote: post #90

The author makes a good case against open source businesses, but he indulges himself in a false dichotomy between a traditional proprietary model and open source. Increasingly often, there is no market for your proprietary software. It is then not a choice between open source and proprietary models, but rather between doing open source or doing nothing. A lot of markets are just gone , and they're not coming back. Od…

Exactly, and open source companies make great money too. ElasticSearch being a prime example, yes AWS eats a large share of their pie, but who cares, the pie is absolutely huge.

Another example is GitHub and Gitlab. Both got big by leveraging the open source community for marketing. Imagine all the resources GitHub spends to enable open source, that's a cost center that will never go away. If they hadn't done it though, they simply would never have become big.

And then Gitlab one ups them, sacrificing an even larger share of the pie, allowing free private repos and free on site deployments. And still they're carving up a big chunk of pie for themselves.

In my opinion it's the only way the future is going to make any sense. It's not a race to the bottom, it's a race to more balance between the rewards of beating the network effect.

If you want to build a new company in a space that another company is already offering significant value, then you are going to have to offer even more value. And if there's no more value go squeeze out of your functionality, and you're already not charging your users, that means you're going to have to give part of your company to the users. It's a mathematical inevitability.

Re: I wouldn't invest in open-source companies, even though I ran one

#118

Post by lillecarl »

tinco wrote: post #117
hapless wrote: post #90

The author makes a good case against open source businesses, but he indulges himself in a false dichotomy between a traditional proprietary model and open source. Increasingly often, there is no market for your proprietary software. It is then not a choice between open source and proprietary models, but rather between doing open source or doing nothing. A lot of markets are just gone , and they're not coming back. Od…

Exactly, and open source companies make great money too. ElasticSearch being a prime example, yes AWS eats a large share of their pie, but who cares, the pie is absolutely huge. Another example is GitHub and Gitlab. Both got big by leveraging the open source community for marketing. Imagine all the resources GitHub spends to enable open source, that's a cost center that will never go away. If they hadn't done it thou…

You should know, Github offers free private repositories. I believe because Microsoft doesn't need Github revenue, but to use it as a funnel towards Azure.

https://github.blog/2019-01-07-new-year-new-github/

Re: I wouldn't invest in open-source companies, even though I ran one

#119

Post by lifeisstillgood »

mooreds wrote: post #79
lifeisstillgood wrote: post #62

The essential problem is gatekeeping . Any commercial business uses money as a means of getkeeping what it uses (buys). This works well to reduce and so control the purchases of chairs, desks, external consultancies and proprietary software. We all know the horrors and pain of trying to raise a PO to get a license for a really useful / necessary piece of software. I fundamentally guarantee that if React needed a 0.01…

>FOSS short circuits this gatekeeping function There are other ways past gatekeeping: * free trials * money back guarantees * free as in beer solutions Open source goes one step further than those and says "you don't just get to use this, you get to own it" where "own" means change as you like.

two of those are either need a purchase order upfront, or in 30 days (which is waaay shorter than the time it takes to actually raise a PO!)

and ... who gives free as in beer but not open source software? I mean winzip is all that comes to mind?

But it does not change the essence - only FOSS gives you software "forever" whilst jumping over the otherwise immutable accounting department t - it is probably the greatest hack no one sees.

Re: I wouldn't invest in open-source companies, even though I ran one

#120

Post by tinco »

lillecarl wrote: post #118
tinco wrote: post #117

Earlier quoted context omitted.

Exactly, and open source companies make great money too. ElasticSearch being a prime example, yes AWS eats a large share of their pie, but who cares, the pie is absolutely huge. Another example is GitHub and Gitlab. Both got big by leveraging the open source community for marketing. Imagine all the resources GitHub spends to enable open source, that's a cost center that will never go away. If they hadn't done it thou…

You should know, Github offers free private repositories. I believe because Microsoft doesn't need Github revenue, but to use it as a funnel towards Azure. https://github.blog/2019-01-07-new-year-new-github/

Oh I know, but they started doing that years after Gitlab did, and only when Gitlab became a significant competitor.
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