Converting an Open Source Project into a Business?

Yaztromo asks: "I'm about to try to make the jump and move my jSyncManager Project from being a time-consuming hobby into a full-time business. I'm hoping to follow the model of other successful Open Source businesses by selling integration, development services and support contracts. Has anyone in the Slashdot community attempted to move their Free/Open Source projects from hobby to business? What were the special challenges or obstacles faced?"

Comments

Special challenges.

[torpor]

What were the special challenges or obstacles faced?

Finding customers. NEVER underestimate how important this is to the success of your company.

All other problems, and yes there are many with relation to OSS in general, are insignificant.

So many startup guys get rolling, only to be void of life 4 months later because they weren't daily working on getting clients on board who will pay the bills and provide lifeblood to the rest of the company.

Sounds obvious, but I just wanna point it out before it gets lost in the /. responses ... Work *hard* on finding yourself customers, harder than you want to, even ...

Re:Special challenges.

[eddy the lip]

Sounds obvious, but I just wanna point it out before it gets lost in the /. responses ... Work *hard* on finding yourself customers, harder than you want to, even ...

Funny how often that does get lost in these discussions, even though it seems obvious. Finding customers is now your number one priority. In the beginning, especially, all that time you're saving by not having a day job anymore will go to getting clients (and a bit of other business minutae). Coding the project will still be something you do in your spare time, although you have a bit more control over when that spare time is.

Have an advertising plan, and a budget for same. Word of mouth will almost certainly not bring in business rapidly enough, or in large enough numbers. Don't rely on it.

Also, for consulting gigs, the right kind of clients are important. Learn how to say No. This is really hard at the beginning, but it's maybe most critical then. The wrong client will suck the lifeblood out of you if you let them. (Hell, the right ones can too ;) ). Do not overcommit, and if they're asking for too much, tell them. They'll appreciate your honesty. If they don't, their the kind that will be a continual burden on your company,and you can't afford them.

Worth Repeating (Re:Special challenges.

[dmorin]

Finding customers. NEVER underestimate how important this is to the success of your company. All other problems, and yes there are many with relation to OSS in general, are insignificant.

Can't be said enough. How many times did we all hear about a dotcom that was gonna do just fine because they had exactly *1* customer who was playing sugar daddy (trans: had a piece of the action) and they swore up and down that they were gonna sign a second customer any day now?

Technical knowledge alone won't get you half what you need. Team with a sales person. Just like there are born geeks in the world, there are born salesman. The sort of guys that see free stuff and just instinctively think "I can sell that 12 different ways, I can sell the service I can sell the support I can license the trademark I can merchandise the logo...." You should be able to at least get out of the starting gate with a good salesman on your team.

Then you'll need somebody with business savvy to start making it look and act like a real company and not just a guy with an idea and a guy selling that idea.

Good luck!

You're facing an uphill battle.

[fmaxwell]

By making your work open source, you let your biggest competitive advantage, the fruits of your intellectual labor, slip through your fingers. Consultants who have offices closer to customers can compete with you to provide support, integration services, and development. Seven guys from India who share a one bedroom apartment and will work for $7/hour can compete with you. If your software is even reasonably well documented, competent software engineers all over the world will be able to add to it, modify it, and support it for their customers.

Your best bet is to come up with a new product, make it closed source, and get paid like the guys who sell WinZIP, WinRAR, UltraEdit, Vedit, FTP Voyager, FTP Serv-U, etc.

Re:biggest problem..

[shaitand]

Yes but remember MOST of those people paying to have their taxes done do NOT have itemized deductions or the complexity of corporate accounting to worry about.

MOST of them could actually spend 30mins and do them themselves with no prior experience and only the information that accompanies the form.