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You sell services rather than products. Businesses outsource all the time, and why not outsource custom work to the same people who make the product you're usin

by vacri 11y ago

You sell services rather than products. Businesses outsource all the time, and why not outsource custom work to the same people who make the product you're using? You're not going to be in the $1B space selling services, but neither are you at risk of extinction.

davidw 11y ago
The problem with this is: billable hours are what make you money, not working in the product. Juggling those becomes very difficult. I've been following this space for years, and there are no easy answers. I think the model where the 'secret sauce' is proprietary, and you give away the infrastructure, like, say, Ruby on Rails, seems to work ok. Produces some good open source software and is still an 'easy'/straightforward business model, because you're selling a product.
- icebraining 11y ago
  The problem with this is: billable hours are what make you money, not working in the product. The two are not incompatible. Most of our new features are paid for by our clients, some of which we then include into our main product. Maintenance comes from other sources of revenue, though - hosting, for example, since many companies would rather not deal with that, even if they could.
oostevo 11y ago
> You're not going to be in the $1B space selling services There are lots and lots of companies in the government and huge enterprise services space that have more than a billion in revenue. A few off the top of my head: * https://newsroom.accenture.com/fact-sheet/ https://newsroom.accenture.com/fact-sheet/ * http://www.nasdaq.com/symbol/ctsh/revenue-eps http://www.nasdaq.com/symbol/ctsh/revenue-eps * http://www.csc.com/about_us/ds/29505-company_profile http://www.csc.com/about_us/ds/29505-company_profile
- vacri 11y ago
  "selling [open source] services [for your own product]", in the context of the thread.
gozur88 11y ago
The last time I worked at a software company they were trying to plump up the license $/services $ metric, because while it's easier to book services contracts they also increase your costs. Software companies only make runaway profits when they sell the same thing to a bunch of different customers. That said, it's not like you can't make money selling services.
coldtea 11y ago
>You sell services rather than products. Well, IBM and Oracle sell services on Open Source products and even Microsoft does nowadays... And they could sell services for my open source product too, if they fancied it. So how that makes me much safe?

by vacri 11y ago

davidw 11y ago

The problem with this is: billable hours are what make you money, not working in the product. Juggling those becomes very difficult. I've been following this space for years, and there are no easy answers. I think the model where the 'secret sauce' is proprietary, and you give away the infrastructure, like, say, Ruby on Rails, seems to work ok. Produces some good open source software and is still an 'easy'/straightforward business model, because you're selling a product.

icebraining 11y ago
The problem with this is: billable hours are what make you money, not working in the product. The two are not incompatible. Most of our new features are paid for by our clients, some of which we then include into our main product. Maintenance comes from other sources of revenue, though - hosting, for example, since many companies would rather not deal with that, even if they could.

oostevo 11y ago

> You're not going to be in the $1B space selling services There are lots and lots of companies in the government and huge enterprise services space that have more than a billion in revenue. A few off the top of my head: * https://newsroom.accenture.com/fact-sheet/ https://newsroom.accenture.com/fact-sheet/ * http://www.nasdaq.com/symbol/ctsh/revenue-eps http://www.nasdaq.com/symbol/ctsh/revenue-eps * http://www.csc.com/about_us/ds/29505-company_profile http://www.csc.com/about_us/ds/29505-company_profile

vacri 11y ago
"selling [open source] services [for your own product]", in the context of the thread.

gozur88 11y ago

The last time I worked at a software company they were trying to plump up the license $/services $ metric, because while it's easier to book services contracts they also increase your costs. Software companies only make runaway profits when they sell the same thing to a bunch of different customers. That said, it's not like you can't make money selling services.

coldtea 11y ago

>You sell services rather than products. Well, IBM and Oracle sell services on Open Source products and even Microsoft does nowadays... And they could sell services for my open source product too, if they fancied it. So how that makes me much safe?