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Monetizing Open Source


#1

I listened to the bootstrapped podcast with Patio11 and I found the open source part very interesting. In my spare time I have building an open source blogging app named WardrobeCMS. My reasons for building it to begin with was mainly to scratch my own itch and build something I would like to use. With that said, right now it is geared more for developers since the install requires a few steps not suitable for the masses. Of course this can be changed but hasn’t been a priority right now.

I had been thinking about ways to just make side money from the app. Something I could do a few hours a night. I was thinking of the common ways such as offering hosting, offer installation service, turn it into a saas app, etc… But the more I think about it the more I keep thinking that is not the best product for monetizing.

Why I am thinking this is because blogging platforms are a commodity now with Tumblr, WP, and a slew of others. Plus every CMS has blogging built in. So is this not the best industry or should I build something more niche?

At any rate I wanted to throw this out and see if anyone had any thoughts and see if you agreed with my thought process.


#2

First off, the company that builds a really slick system for making hosting of on-premise oriented apps easy is going to make a fortune.

In general, doing hosting is a low profit high touch proposition. One area people seem to make decent money in with this stuff is plugins/themes. If there was a simple plugin setup then you could run the store which sells them and themes and perhaps build some plugins of your own of course.


Sandstorm and the end of SaaS?
#3

I think that @ianlandsman has a good idea with charging for themes or plugins, you could also create training content around how you built parts of it. I think the hard part will be setting WardrobeCMS apart from all the other blogging/cms platforms out there, I mean http://tryghost.org/ looks awesome and they have been able to raise a LOT of money via kickstarter and they did that (I think) by presenting a very simple, polished, yet powerful tool.


#4

When I was working on Liberum (open source help desk) many years ago. There were a few way I monetized it or could have:

  1. Donations: I had my direct costs of the project paid for and a little extra for beer & pizza, but that’s about it. A majority of that came from companies who had set aside a budget for the software but choose mine instead of commercial alternatives. I don’t know if consumer-oriented software would fare better or worse here.
  2. Consulting: A common request was for one-off customizations paid on an hourly or project-basis. This scales directly with the time you are willing to put into it though, and some customers are not keen on allowing the new development to be opened sourced which doesn’t add value to the product in the end.
  3. Hosting: Can your software be multi-tenant? Yes, congratulations, you are now in the SaaS business and you can add cloud to your marketing material. If it’s not multi-tenant, then you’re just reselling web hosting at a small premium unless @ianlandsman’s idea comes to fruition.
  4. Getting your name out there: Having a successful open source project is like have a big billboard that says HIRE @ericbarnes, HE KNOWS WHAT HE’S DOING! You can increase your value in your day job which may go way further than monetizing the open source project itself. (Don’t tell Ian this though).

Additionally, there were occasional offers to buy the source code and website, but that essentially defeats the purpose of open source if its going to be closed and sold under a commercial license.

Personally, I only found #1 and #4 all that useful since I really wasn’t interested in a second job. Interviews do become exceptionally easy if a company is already using your software. :wink:


#5

Hey, this forums is taking a turn in a negative direction for me :wink:

Also, nice to meet a fellow help desk app chap. I haven’t had the chance to use Liberum, but have certainly been aware of it forever. Welcome aboard.


#6

Ha, if Liberum is your competition, then you are in great shape! :smile:

Honestly, I haven’t written any code for it the past decade, but I don’t have the heart to put a bullet in it yet.


#7

I’ve been fascinated lately by the idea of software being “done”. I’m not sure it’s possible, but it’s a wonderful dream. Perhaps you’re living the dream!


#8

Thanks everyone. Going to ponder over these suggestions and see what I can do. I am still not 100% sold that this is viable with so many alternatives. But at the end of the day if you don’t try you will never know. :smile:


#9

Maybe being internet famous is enough?


#10

Another idea, though the monitization is small would be to add something like Carbon Ads to the Wardrobe site


#11

Phil seems to be onto a good thing with Pyro. Free open-source but there’s also a commercial aspect. Plugins and themes are always good but they take time.

If you have a pretty good fanbase (I love Wardrobe by the way), you could try selling tees, stickers or other merch. It’s free advertising for you and people love showing off in Starbucks while sipping their latté.

A book could also be another route. I’d love to know some of the practices and ways Wardrobe rocks. It also totally suits your audience of devs.


#12

I was also intrigued with Patrick’s (patio11) suggestion to use BinPress to monetize GPL software. As it happens, I just have a piece of code, a useful library for a large enterprise system. It is a code, not a product, so it is hard to sell it.

Patrick suggests to release it as GPL, and then charge for custom (non-GPL) license for customers who just cannot use GPL (that would be most of enterprise).

I decided to give it a try. I’m going to release it as GPL into Github, do a Github page with HOW-TO and examples, and spread the word in the specialized forums… and also attach a hefty custom-license price tag to it.

I’m thinking something around $4,000 (a cost of a week of a regular Canadian contractor).

The whole thing took some 3 weeks to build, so the savings for a buyer are substantial, not mentioning the fact that the library saves development time in a long run.

I’m doing some final polishing now, expecting to finish the code in another 10-15 hours. Another 25 hours to write the documentation and examples, and posting to the forums.

I’ll keep you posted.


#13

Hey Eric, I want to first say that Wardrobe looks great. A clean open-source platform that gets out of the way could be a great fit.

I’d shift your thinking away from “Well there are so many other blogging platforms out there” to “what can a user do in Wardrobe that they can’t in other platforms (or at least can’t do well without a billion plugins)”

Some ideas:

  • A member subscription-based content site, blog newsletter, etc
  • Easy landing pages, create a/b landing pages without using a SaaS service
  • Beautiful gallery or photo blogging, maybe sell prints or charge members a monthly fee for access
  • A blogging platform that reminds you to write something every day/week/month and will suggest topics to write about in your area of expertise. The biggest pain I have with blogging is actually writing on a regular basis

Diving into a niche and serving that really well can really pay off. People will pay for a CMS (Craft, ExpressionEngine, Statamic, Perch).

It’s a mental shift, as developers we think “well if users have a multi-purpose tool they’ll just build their own thing,” most people will pay money for the result.

Honestly, if you’re thinking about selling Wardrobe as a commercial product, just do it. And I mean sell the sucker as is (maybe with an installer). What do you have to lose? Get a Gumroad account and offer the following to your customers:

  1. 1 Day SLA priority support (or phone support)
  2. Non-GPL license (it’s an MIT license, but let companies know they’re not at risk)
  3. Automated backups / Service / Install (backup could be a shell script or a small plugin your write)

All these things are minimal or things you already offer and business will pay to have that stuff taken care of for them. Also keep in mind most companies are price insensitive up to $500, after that they have to get approval up the manager food chain.

I think you have a great product and a good community. If you think Wardrobe is your best idea right now I wouldn’t abandon the notion of selling the product too quickly;


#14

You could also have a dual license system where you have a an enterprise version of your product that you charge more for, similiar to how magento does it and which I believe discourse.org is also considering.


#15

I like the idea of creating promoted feature packages that are not free open source. Granted I’m a bit biased as I am a contributor to Wardrobe.

@dsrii may have some insight from what they learned with Sentry.


#16

Matt Mullenweg has been interviewed a few times on This Week In Startups. It’s a great series of videos on how to balance open source & commercial success. I highly recommend it

Since I can’t post more than two links. Here’s Twist #26, 2nd Interview Part 1


#17

Here’s the part II of the 2nd TWiST interview:


#18

That is certainly a popular way to go but realize at that point the open source product is really just a marketing tool to sell the commercial version.

Also, does one entity or person own the copyright for all of the code in the product? If not, do you have a license from those other sources which allow you to sell the software under a closed/commercial license? Those are things to be very aware of if selling open source software under a new license.

Edit: It looks like this doesn’t apply to wardrobe since it is currently under the MIT license and presumable contributions are under the same. This would be an issue for GPL or other more restrictive open licenses.


#19

Wow! Thanks for all the ideas. I need to get it polished up for a 1.0 release and then really sit down and think about all this more. Off hand I do not like having the core GPL and then paying for a more “open” license. I have lots of reasons for this but the biggest is the license is so restrictive I don’t want to mess with it. If developers want to contribute I’m all for that and I don’t want to infect their code with gpl just because they want to build a feature.

Thanks again for all the comments!


#20

You stick it with GPL and I’m out of the refactor.