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Making a Living Building Open Source Software?
asimbaig asks: "When I started my IT Staffing and Placement firm last year, I couldn't find a decent Applicant Tracking System (ATS) or an Open Source alternative. I then found SugarCRM, and was blown away by its power and ease of use. Partly frustrated with the existing vendors and partly inspired by SugarCRM, I decided to write that ATS using LAMP. 6 months and 45k lines of code later, I have just released the preview of industry's first Open Source ATS/HR Management system, called CATS. Now, it will be an interesting experiment to see if I can actually make a living out of it and move away from my IT staffing business. SugarCRM seems to be doing well, so why not?. Is anyone out there making a living from writing Open Source code?"
you must remember that since you're trying to profit from an open source project, the software itself is essentially public domain and you won't be able to sell licenses for it. If you try to jump through licensing hoops to try and prevent that, you won't get as much support from the OSS community in support and integration for your product. Remember you can't make money selling electrons.
So where's the money come from? That's what everyone's trying to figure out. The subscription model is one, selling support licenses is another. I'm trying to find a way to sell complete systems, so the value isn't so much in the software but in the labor put into building a complete open source system. There are as many ways to try and hack this as there are open source programmers.
6th Street Radio @ddombrowsky
Are you telling me you just spent a lot of time building a piece of software, which you've already licensed, and you've decided now is the time to come up with a business plan? That is pretty backwards, in my opinion.
There are a number of business plans for selling software and even a number of them for making money from Open Source Software:
Plan number one, sell licenses to closed source software. I think you've already missed this one and it has the disadvantage that it can't compete against an open source product in the long run.
Plan number two, get a company or conglomerate of companies to agree to pay you to develop and support a cheaper, better, more customizable alternative to their existing software. I think you missed this one two, if you already made the code public.
Plan number three, release code for free and try to get companies to adopt it and pay you for support and customization. This is probably your best bet at this point. You need to find out what current companies charge for support and what they charge for their software and meet or beat their prices; or, you need to provide significantly more functionality. You need to get some good sales guys and give them the advantages of your product over other products. Main advantages you hold include the fact that it is open and thus they can migrate to other systems and that you or they can customize it to meet their needs. Find out what their current software doesn't do that they would like and make yours do it, just for them. Emphasize the personal service as part of a support contract that is semi-annually renewed or whatever. This is your revenue. Drawbacks to this include that the better your software gets, the less likely they are to need support and they can always go with their own IT dept. or with a competitor for support. You have the edge in that you know it better than anyone and are someone external to blame/call.
Plan number four, release the product for free and promote it. Beg for donations from big companies that adopt it and other benefactors. If it becomes popular your reputation will be worth a lot to you for speaking engagements and other contract work.
Best of luck.
I run the Symphony OS project (http://www.symphonyos.com/) in what free time I have. In the last year since the project has grown a bit the best month of donations we have had was about $95. That was with one person donating $50.
Over the last year the project has received maybe $300 between cd sales and donations. Out of my pocket for servers and other expenses in running the project (not counting time) I have spent about $2000.
I am sure once we have a more stable release dontations will improve and I dont blame people for not donating to an unstable project, but even with a stable project I dont think donations is any kind of a way to make a profit. At best it helps offset the money you spend to keep your project going.
Take a look at Sendmail.org and Sendmail.com - one corporate and one OSS.