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How to make $100k in Open Source by working hard

mikeperham.com

51–60 of 96 posts

Re: How to make $100k in Open Source by working hard

#51

If your story is true, then stop talking about it already! First, Since you're in the U.S.A., you'll be getting into the 40-50% marginal tax bracket with federal, state, and Self-Employment Taxes. If you incorporated in an off-shore jurisdiction, you'll keep all your money. In your situation, it's completely invisible to your corporate customers where you are located. If they're willing to pay random guy in Portland,…

I upvoted you because it's an interesting dissenting opinion, and I've always wondered about whether the upside of being open beats the downside of additional competition. We also don't know whether he paid taxes on the income (I also guess not), and, most importantly, whether his blog post will bring him additional revenue. Do you have many examples where blogging about success brought about competition? Are there b…

>> We also don't know whether he paid taxes on the income (I also guess not)

Mike is an upstanding citizen and member of the open source community. There's absolutely no reason to make unfounded claims like this against his integrity.

Re: How to make $100k in Open Source by working hard

#52

The title of this article is the opposite of what the article says. He made almost no money with open source. He made tons of money by withholding features from the open source library and instead only offering them under a commercial license as an add-on. Since this is itself a violation of the LGPL, anyone using the Pro version isn't even using open source at all, as both the original and Pro enhancements are at th…

Something can be pay for use and open source. What he did here was totally fine. Sidkiq is amazing, and what it replaces is kludgy. If Sidkiq or Riak want to make a version that is specially geared for people that need software to scale then everybody wins. The people at scale win because they buy the software for peanuts and they were able to do so only after hitting product-market fit. The people starting startups…

There's nothing at all wrong with what he did - it's just not 'making money from open source' per se. I guess you can argue he would not have made money were it not for the open source project, but the actual money is coming from what he's holding back.

Re: How to make $100k in Open Source by working hard

#53
post #52

Earlier quoted context omitted.

Something can be pay for use and open source. What he did here was totally fine. Sidkiq is amazing, and what it replaces is kludgy. If Sidkiq or Riak want to make a version that is specially geared for people that need software to scale then everybody wins. The people at scale win because they buy the software for peanuts and they were able to do so only after hitting product-market fit. The people starting startups…

There's nothing at all wrong with what he did - it's just not 'making money from open source' per se. I guess you can argue he would not have made money were it not for the open source project, but the actual money is coming from what he's holding back.

How does RedHat make money from open source? They hold back support.

Re: How to make $100k in Open Source by working hard

#54
post #52

Earlier quoted context omitted.

There's nothing at all wrong with what he did - it's just not 'making money from open source' per se. I guess you can argue he would not have made money were it not for the open source project, but the actual money is coming from what he's holding back.

How does RedHat make money from open source? They hold back support.

Redhat's strategy is a bit more complex than that:

They only support the official Redhat release, but that contains Redhat's trademarks, which you are not free to copy/modify/etc... and indeed, you have to pay for the official release.

I think it ends up being that if you need the official Redhat, you pretty much have to buy it, and buy a long-term-ish support contract.

In any event, support is not a public good along the lines of software: it's very much rivalrous and excludable.

Re: How to make $100k in Open Source by working hard

#55

Earlier quoted context omitted.

Why do you object to calling this 'making money with Open Source'? I agree that "making money by developing and selling closed source extensions to open source products" is 'making money with Open Source'. Especially considering he also developed and maintains the OS product.

Because it seems similar to claiming prostitutes make money by greeting people and chatting. Although they do greet and chat for free, what they actually do for money is different. Note: I believe prostitution is a morally acceptable profession for consenting adults. Therefore I'm not choosing that analogy to be pejorative to the OP; I'm choosing it to be blunt. IMHO the OP is doing nothing wrong, and more power to h…

Well for legal reasons, many of them do claim to charge money for the greeting and chatting, and whatever two consenting adults happen to do after that is their own business.

It's true that they probably couldn't charge for the greet and chat if it weren't for what they do for "free." It's also true that Mike Perham probably couldn't charge for his commercial work, if not for what he did for free.

Admittedly this is a rather loose analogy.

Re: How to make $100k in Open Source by working hard

#56
post #6

I think there are likely a variety of contractual options other than "24/7 phone support" which businesses would be happy to pay for, on an ongoing basis. For example, you could charge $500 plus $100 per year for "maintenance", and not be any more specific than "the software will be maintained in an ongoing fashion", and now you won't be starting from $0 next January 1st. As someone who has started from $0 every Janu…

Hey Patrick!

Just wanted to say I love following your blog - And this is definitely something that's been engrained in my mind after reading it, and I'm glad you've reiterated here.

If anyone would like to follow him - here's a link to an arbitrary archived newsletter that he's published where you can sign up: https://training.kalzumeus.com/newsletters/archive/sources_o...

Re: How to make $100k in Open Source by working hard

#57

If your story is true, then stop talking about it already! First, Since you're in the U.S.A., you'll be getting into the 40-50% marginal tax bracket with federal, state, and Self-Employment Taxes. If you incorporated in an off-shore jurisdiction, you'll keep all your money. In your situation, it's completely invisible to your corporate customers where you are located. If they're willing to pay random guy in Portland,…

The IRS has already thought about this scheme. If you are a US citizen, you need to report all foreign bank accounts if the sum of foreign money is over $10k. Failure to do so is a $100k fine. I expect there are other problems here.

I had heard that you could license your software to your company, which is advantageous since apparently license fees are taxed at capital gains rates (15%). I have not verified this, however.

Re: How to make $100k in Open Source by working hard

#58
post #54

Earlier quoted context omitted.

How does RedHat make money from open source? They hold back support.

Redhat's strategy is a bit more complex than that: They only support the official Redhat release, but that contains Redhat's trademarks, which you are not free to copy/modify/etc... and indeed, you have to pay for the official release. I think it ends up being that if you need the official Redhat, you pretty much have to buy it, and buy a long-term-ish support contract. In any event, support is not a public good alon…

In other words, redhat doesnt make money from open source. But nobody ever complains when they're held up as the poster child for how to make money from open source.

Re: How to make $100k in Open Source by working hard

#60
post #7

Is there a good data source of open source-based jobs and how to get them? Clearly there is a massive open source economy. I would like to understand that better.

I'm also interested on this!

I really wish someone would do a PhD dissertation on it, or write a book on it, or something. I guess it's likely that there's something somewhat like what I'm looking for out there already.
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