The Business of Open Source

This week on The Business of Open Source, I spoke with Pablo Ruiz-Muzquiz, CEO and co-founder of Penpot. We started out by talking about the transition from services company to product company, how they decided to pivot to building a product company and when they made the decision to go all-in on the product. Perhaps the most interesting part of the conversation is the discussion of the business model. It’s almost like open core in reverse. Penpot open source is fully featured and very flexible; but there’s a separate product available for business stakeholders to control how Penpot is used in their organizations. So when you need gouvernance and control, you should pay for the additional product to control Penpot usage in your organization. But if you don’t need to limit how Penpot is used at all, you (and everyone else in your organization) can use the open source version without the additional controls. We also talked about dual audiences. Penpot has to appeal to designers and developers, and building something (and ultimately marketing/selling it) that has to appeal to two very different stakeholders. We talked about how the company manages that balance, and why they want to have more developers using Penpot than designers. We talked a bit about Open Source Founders Summit as well. If you’re interested in learning from other founders and leaders in open source companies, join us at Open Source Founders Summit in Paris! 

Alya Abbott, COO of Zulip and a leader in open source community management, shares insights on nurturing community contributors. She discusses the importance of treating the contribution process as a product to enhance the contributor experience. Strategies like user experience testing and clear documentation are highlighted to foster involvement. Alya also emphasizes how effectively managed contributions can boost development speed and enhance project success, making open source collaboration more rewarding for all.

Nick Veenhof, Director of Contributor Success at GitLab, dives into the innovative dual flywheel strategy that enhances growth for both open source users and paying customers. He emphasizes the importance of incentivizing contributions and the co-creation strategy, where customers actively improve the product. Veenhof addresses the challenge of balancing user involvement while ensuring fair treatment for all contributors. Additionally, he discusses streamlining onboarding processes and promoting recognition through a leaderboard, making contribution accessible and rewarding.

In this engaging discussion, David Aronchick, CEO of Expanso and a key player in the Kubernetes project, shares insights on building successful tech ventures. He emphasizes the role of luck and timing, noting that Kubernetes thrived not just due to tech excellence but right ecosystem conditions. David advocates for focusing on solving universal problems rather than specific technologies. He also reflects on the challenges of go-to-market strategies and the need for early investment in community engagement to foster open-source success.

This week on The Business of Open Source, I spoke with Thomas Schedler, co-founder and CEO of Sulu. Sulu is a small, bootstrapped company that spun out of an agency; Thomas was recommended by someone to me as a guest, but when I first reached out to him he was skeptical about coming on the show because he wasn’t sure he was a good fit. But there’s a bunch to learn from this episode! Spinning out from an agency —> in my experience, one of the most common ways for open source companies to be bootstrapped, or even to be go on to raise venture capital, is to start out as a web development agency that uses a lot of open source tools.They are working on moving away from services and getting more revenue from the product; and Thomas talked about the advantages that they get from providing both services and developing a product-based business strategy.The CMS market is crowded! And everyone is open source, so being an open source company doesn’t differentiate the product at all. So how does Sulu differentiate itself in the market? Thomas talked about it. I loved that Thomas talked about how important opinions and technology choices are in differentiating themselves on the market. I also loved that Thomas talked about keeping some things out of the product as a way to differentiate themselves from others. Sometimes more features can deliver less value to users. How being small can allow you to move quicker, and that gives Sulu and advantage over the huge players in the CMS market.Why differentiation and knowing your niche is so important when you’re a small company competing again large players. Do you need to differentiate yourself in a crowded market? You might want to work with me. 

This week on The Business of Open Source I spoke with Marco Möller, CEO and co-founder of Pionix. This was a fabulous conversation about a company that’s in a very different market from the usual open source company: They make firmware for EV charging stations, and are behind the EVerest project, which is part of LF Energy. So who is part of the community open source projects that are so connected to hardware? Here’s what we talked about. There aren’t many hobbyists in the community — but there are a lot of people who have professional interests in the electric vehicle industry. EVerest doesn’t focus on what Marco considers “personal” or “hobbiest” features. This was a great discussion about how understanding the target market, including for the project, leads to different feature decisions. How does Pionix money? It doesn’t yet :), but we talked about various plans the company has for monetization in the future. How being involved with the LF Energy has helped build trust, which is very important for a company that is only going to be selling to large companies and governments. Why Marco thinks that the huge vision he has for creating firmware for EV charging stations is only possible with open source, and how he makes sure that he’s able to fund the large mission without hurting the community. The balancing act with getting investors who specialize in the energy market but who don’t have experience with open sourceStruggling with positioning your project or figuring out how to best monetize? You might want to work with me. 

Julian Coccia, CTO of ScanOSS and expert in open source compliance, dives into the thrilling intersection of AI and open source code. He highlights the startling fact that 2% of AI-generated code may include verbatim open source snippets, posing serious compliance risks. Navigating the challenges of monetizing open source, he discusses the importance of visibility in the sales funnel. Tune in to learn about the Open Source Founders Summit and discover ways to enhance business success through strategic team selection and innovative solutions!

Today on The Business of Open Source I spoke with Liz Rice, Chief Open Source Officer at Isovalent, which is now part of Cisco. We addressed two subjects: How to be successful as a company that donates their project to the CNCF, and the story of Isovalent’s acquisition by Cisco and the role open source played in that acquisition. We talked about: Trademarks. This is a very important part of what you donate when you donate a project to the CNCF (or other foundations). We talked about what you can and can not do with the name and logo of “your” project when it becomes part of the CNCF, and what that means for the competitive landscape you’re a part of. How to best take advantage of the marketing benefits that being part of the CNCF brings. How to create a link between the CNCF project and the company that donated it. The role that Cilium and eBPF played in Isovalent’s acquisition by Cisco. Why Isovalent’s relationship with open source is valuable to Cisco in and of itself. How open source companies can increase the likelihood that they’ll be able to continue investing in open source post-acquisition. Why it’s so important to find opportunities for collaboration. Want help making the link between your CNCF project and your commercial product? You might want to work with me. 

This week on The Business of Open Source I talked about Open Source Manifestos with Vincent Untz, CTO of Centreon. The entire conversation focused on this idea of open source manifestos, which Vincent is going to talk about at Open Source Founders Summit — and I had never heard of before. The idea to create an open source manifesto came about because internally there was a lot of frustration around Centreon’s relationship with open source. A lot of people, especially those who didn’t come from an engineering background, would routinely ask why the company invested so much in open source. At the same time, there was a feeling among the engineering team that the company’s commitment to open source — and the concrete development time spent on open source — was slipping. After creating the manifesto, the doubts about why open source mattered went away immediately — there hasn’t been a single conversation calling into question why open source matters since the manifesto was finished. Now conversations about open source are different. Externally, there’s been a huge change in conversations around open source. People say things like “Centreon is back in the game.” It’s hard to point to concrete financial results as a result of the manifesto, but there have been differences in relationships with partners for sure, and it has helped get more companies to contribute to the project. Want to see what the Centreon Open Source Manifesto looks like? Check it out here. 

This week on The Business of Open Source, I spoke with Lukas Gentele, the CEO and co-founder of LoftLabs. Here’s some of the things we covered: There are many open source projects at LoftLabs. We talked about what the team did differently the second time round, when they’d had the experience of creating the first project under their belt, and why they continued creating additional projects after that. How they make roadmap decisions to decide what goes in the OSS versus what goes in the enterprise editionHow they thought about the benefits to the business from open sourcing vCluster, the second project they released, and whether or not the theory about how it would benefit the business ended up being correct. Whether or not open code is necessary for community building, and why. In particular, we talked about the difference in how people feel ‘ownership’ of open source projects when they contribute to them. The pros and cons of building different brands around your project, your product and your company; and of having different brands around your different projects. We talked about this a lot; LoftLabs has a different company brand from any of the products or projects, but they discovered that if the project and product do not have the same brand, people get so confused that they ultimately do not buy. If you need to figure out how to brand your project and product, you might want to work with me. If you want an opportunity to talk with other founders about branding, community building, and more, you should join us at Open Source Founders Summit May 19th and 20th in Paris.