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How Open Source Projects Turn Into Successful Businesses

Filed under
OSS

From Open Source Project to Business Model

Most open source projects are born of necessity. Individuals need code for specific purposes, so they start writing it. Maybe other people could use it, too, so they start a project on SourceForge. The earliest users are typically developers who also need to use the code. If the project takes off, then more developer-contributors join the community. At some point, projects usually settle into a routine of core contributors. As the project gains popularity, the user base is likely to shift more towards users who do not contribute code. These users add value to the project by submitting bug reports and spreading information about the project to peers.

Early users are tolerant of bugs and incomplete product features. It's worth it to them to be able to use free software and be a part in guiding its future. Because of all the elbow grease they put into the software to make it work for them, they won't spend money on support or extra features. They do not make a market.

After a while, and a lot of hard work, the software's feature set becomes more complete and achieves a higher level of stability. At this point, the project is ready for users who lack either the willingness or ability to delve into the code. These are the users on which to build a business model. They are the market.

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