Open source is an implementation strategy for closing a business model. Strategic use of open source can move a business model from a money loser to a money maker.
It can be extremely strategic to use source components in the supply chain of a software product. Using open source components allows the engineering team (if one is needed at all) to focus on the unique parts of the project. This can reduce development/maintenance costs and timelines. It can also make up for missing skills on a business team. Facebook did this with Open Compute Project.
It can also be strategic to release parts of a product as open source. For example, releasing a database, OS, or framework as open source can establish an industry standard, improve brand awareness, quality, and make it easier to hire new talent. Basecamp did this with Rails. Google did this with Android.
Open source can also commoditize a market segment to a point where large companies that might otherwise compete choose not to. WhatsApp did this with Erlang and their initial messaging stack.
However, if you’re releasing 100% of your intellectual property & technology as open source then you might attract enough attention to get funding, but you probably don’t have a business model.
It can be extremely strategic to use source components in the supply chain of a software product. Using open source components allows the engineering team (if one is needed at all) to focus on the unique parts of the project. This can reduce development/maintenance costs and timelines. It can also make up for missing skills on a business team. Facebook did this with Open Compute Project.
It can also be strategic to release parts of a product as open source. For example, releasing a database, OS, or framework as open source can establish an industry standard, improve brand awareness, quality, and make it easier to hire new talent. Basecamp did this with Rails. Google did this with Android.
Open source can also commoditize a market segment to a point where large companies that might otherwise compete choose not to. WhatsApp did this with Erlang and their initial messaging stack.
However, if you’re releasing 100% of your intellectual property & technology as open source then you might attract enough attention to get funding, but you probably don’t have a business model.