Ask HN: How do you make a profitable business out of an open-source project?
I'd like to make the best possible note-taking experience out of it, that implies developing a web-app, mobile-apps and generally putting considerable resources into the project.
I think the best way to ensure all this will come to fruition is if the app/service itself was profitable, ideally I would like for it to pay for itself and also provide enough funding for future projects of mine.
I'd like the business to be defensible, but also avoid making the app closed-source. I'm not sure how I could avoid having the (probably simple) server reverse-engineered at some point in the future in order to avoid paying for an eventual subscription fee though.
What do you think is the best way to achieve profitability?
[1] https://github.com/fabiospampinato/notable
35 comments
[ 5.5 ms ] story [ 99.3 ms ] threadhttps://sfosc.org/business-models/
- Paid support from the official development team.
- Paid features, plugins, or addons that primarily serve enterprise users.
- Paid hosting
- In-app advertising
Mention your story, perhaps offer a few extra features if you’d like, and as other said you may want to offer hosting too (but that’s extra work/cost for you). My recommendation would be to just have one simple monthly price = easy y/n decision.
Some people will start paying, and talking to these you’ll figure out why, and how to convert more.
Check out how others are doing, on top of my head I can think of bitwarden (not affiliated).
I haven't tried your app but let's say your app helps people better manage time, then you have a perfect audiende that may be interested in buying a small ebook about productivity and how your app can be used to double it. You already have a list of prospects who trust you and use your product. Upselling them is easy if you can create a great resource that will help them get the most out of your app and achieve the goal (for which they're using your app) more quickly or lazily
If you could share your experience about this it would be very helpful, thank you!
It's also hard to sell extensions... I've had a couple of people email me with suggestions for paid feature requests, but nobody ever followed up when I made an offer and quoted the actual cost. Maybe I'm just not good at selling, though.
(People do offer to buy group licenses if you add a feature, but that only works for minor features you wanted to add anyway, and doesn't work if your product is free anyway...)
While that's not full-time, it's a start of a paying community, which is very valuable in itself.
Once a community like that is established, you can implement other suggestions like selling packages, hosted versions etc. with discounts for your patrons etc. Many ways to go about adding value (and getting paid for it), once people trust you with their money.
These are some possible options:
- Open-core (e.g. Gitlab): Some code is closed source but adds extra features not available in the open source core.
- Support/consultancy
- Sponsorship or Patreon (not realistic or sustainable as a long-term solution for the industry as a whole)
- hosting and online accounts for software that runs in the cloud
The problem is: what if you don't want to do any of the above? I bet there are many developers who are put off by all the above.
What if all you want to do is just sell your product for a fee to users, but with the source available? Impossible with open source. (Doing that is a "source available" option but it's no longer an open source solution.)
The uncomfortable truth is that, despite decades of open source software, no-one has figured out how to make money from an open source product if all you simply want to do is just sell your open source app.
If you find a suitable option for your app please let us know and I wish you lots of success :-)
Fortunately the extra work of building an hosted solution or some business-oriented features doesn't put me off.
1. Extend the open source product in ways which makes it more valuable for specific groups of people, sell licenses to those people. As the product matures and you add more new features, maybe some of the early extended features get pushed into the open source product.
2. Offer monthly/annual support agreements to people who sign up for a licensed version.
3. Offer to make custom modifications for a fee for specific clients (this might be a way to help start doing #1 too).
A lot of this will boil down to marketing the benefits to the right groups of people and finding features which are valuable to businesses over the open source edition -- this is true for open source just as it is to proprietary products. I don't see how (not to say it is impossible) Patreon or similar platforms will lead to enough income to make this a profitable project, although they may help validate people are willing to pay something for the product.
I don’t think this forums audience is indicative of your actual market. I think your actual market is not tech savvy. They want to use notes across multiple devices and teams without thinking about it. Offer them that convenience. They will pay for it.
https://twitter.com/patio11/status/1067695403255029761
Which is quote-expanding Swift On Security:
https://twitter.com/SwiftOnSecurity/status/10676827595928698...
I'm pretty sure I originally saw it as a comment on HN in which he talked about giving a project apparently a somewhat sizable amount of money in exchange for an invoice. I have no idea how to find that. But his tweets on the topic are what other people typically supply when I mention this detail.
Regardless of the model used, getting paid for your work seems to generally be additional effort on top of accomplishing the thing itself.
I'm not saying it's the problem, I'm just saying it's probably not the solution, at least long term. As you say getting any revenue at all is always difficult, but off the top of my head I can think of way more business that are alive because of sales rather than donations.
If I were you, I would be looking at WordPress for inspiration. They have many sources of revenue:
- Hosted version (monthly fee)
- Marketplace for add-ons
- Support
It seems like you have created a community, so to create some kind of extension system would be a way of generating revenue and encouraging people to develop on your platform.
https://sidekiq.org/support.html
If a competitor comes in and takes 50% of the market, that might be frustrating, but it also means there's a market to fight over.
Look at wordpress -- they probably make a lot of money with wordpress.com. But there are also 1000s of other wordpress hosters out there. That doesn't harm Automattic -- on the contrary, without the huge ecosystem around Wordpress, nobody would know that it existed in the first place.