I am not certain but, here is what it looks like. First I'll describe the text, then the apparent business model, then I'll kibbitz a little about the business

I am not certain but, here is what it looks like. First I'll describe the text, then the apparent business model, then I'll kibbitz a little about the business model. The "chef client" is a program that runs on servers, either on-demand or just periodically. It runs a ruby program called a "chef recipe". Roughly speaking, this program computes the correct configuration for the server, examines the actual configuration, and fixes disparities. As an example, my recipe might say (in effect) "Apache should be running. The config files should be the lastest versions of package X but the virtual server names have to be rewritten depending which users are hosted on thsi server." The chef client checks to see if Apache is running and the config files are so -- if not, it fixes things. Information about how particular servers are to be configured may be stored on a separate "chef server". The recipe running on the chef client can read and update the chef server records. The firm sells the on-line service of hosting a chef server for you, if you like. They would appear to charge in proportion to the number of server configurations you host (judging by the "up to 5, free" freemium). The firm additionally sells training. I would guess that training is value priced but with discounts for customers who also make a commitment to pay a subscription fee. It sounds as though all of the code, client and server, is under a free software (but non-copyleft) license. Notice that they do not make it easy to anonymously download the software from their commercial site. I would guess / hope that they are also selling support subscriptions which don't involve hosted "chef server" service but do include convenient access to at least mildly warranted distributions along with weakly guaranteed issue report response times (and just general good will). If the facts and surmises above are correct: 1) They are theoretically vulnerable to a rival that subscribes to them (to get the lastest distributions) but then separately sells the same services for less money. This isn't important because it's worth going to the upstream source. 2) They are theoretically vulnerable to technical staff quitting the firm and opening an office across the street. This would be such a reputation hit for the whole product and team that the stars are unlikely to align that way. 3) At first glance it looks like their hosted "chef server" is a lame lose because it's so technically thin. If they don't already I think the notion is that they tie service subscriptions to preferential access to the data set comprising their "cookbook" (resources to speed up recipe development). In other words, they're main subscription "added value" may turn out to be a walled-garden open source community. That's a pricing challenge, though. If you're hosting the chef server you can charge-per-server-config and that's an OK proxy for value-based pricing (hence, scalable profits -- mostly passive income that grows roughly linearly with the number of server configs hosted). If, on the other hand, you're charging just for nice access to the low-walled-garden customer community and core development/support team: how do you do value based pricing? A customer who is a 5 person small business needs just about exactly as much from you as, say, a division or large department of IBM: they'll want to pay roughly the same amount. 4) They are hugely vulnerable, in my view, to security lapses on multiple levels which, owing to the nature of their business, can have an enormous, immediate, and irrevocable impact on many customers within a short period of time.