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These arguments are myopic. It doesn't matter if your source is open if people give you money, right? So how to get people to give you money? The first answer

These arguments are myopic. It doesn't matter if your source is open if people give you money, right? So how to get people to give you money? The first answer is "find a pain point and build a product". Note I said product, not open source tool. The second part is selling it. That's pretty easy: is anyone else fixing this pain? No? Then sell people the product. You can give away your source code, but that's completely incidental. The third part, "Our competitors will fork and steal our business!", is possible, but extremely unlikely, unless you suck at your product. Incumbents don't get unseated without tremendous effort. The longer you're around, the more people will trust you to do it right, and the better you'll be at it, with more features and more customers. (I don't know of a single case of this ever happening; it's usually just a completely new open source product and they compete fairly) The last part, "How do I keep people from just building and using the code for free?", completely depends on how difficult this is, and whether your packaging and selling of the product provides additional value worth paying for. The simplest way is to provide premium services that solve more pain points and to provide this with their purchase. But you can also just make the software so annoying to build, and cheap to purchase, that it makes more sense to buy it.

vinceguidry 8y ago
> The third part, "our competitors will fork and steal our business!", is possible, but extremely unlikely, unless you suck at your product. I don't think you appreciate the danger here. Someone can sink a few tens of thousands of dollars into cloning a codebase, then make it to market in a bare fraction of the time it took you to get there. When you say "incumbents don't get unseated without tremendous effort," you're referring to big incumbents like Amazon or Google, or CVS or Home Depot. Sure, at that scale it's impossible to ramp up that quickly. But for small outfits struggling to survive, handing the jackals everything they need to compete with you is flat-out stupid. The barest vestige of a moat, something as small as locking your doors, can be enough to get the jackals to pick easier targets. Having to manage the creation of a software product is an order of magnitude harder than just cloning it and differentiating it from there.
- peterwwillis 8y ago
  You can claim a lot of things that don't happen are dangerous. Skating on ice is dangerous, because someone could bring out a flamethrower or napalm. Flying on a plane is dangerous, because someone could fire a shoulder-mounted rocket at your plane. Eating food with a fork is dangerous, because someone could come up behind you and slap the fork into your throat. All of these things are dangerous possibilities that do not happen. AFAIK, small startups do not get unseated by other small startups that poach their technology in order to ruin their competitor. Besides being quite unethical, it's very bad PR. Not to mention, someone else would have to be in the same position, ready to take the same risks, on the same business model, with the same technology, at the same time. Risky things happen. But so far, I am unaware of this particular risky thing ever happening. I would love to hear if it has happened before. (I will add the caveat that if anyone were to do this, it would be China)
  - vinceguidry 8y ago
    The HN crowd tends to stay outside of these kinds of business circles, but I have a friend who doesn't, and he would ping me from time to time about "cloning a site and building a business around it." It took me awhile to understand the mentality. But "Uber for X" is very much a thing. We just don't pay attention to them because those companies never reach Uber growth. But you don't get to be Uber by just acquiescing to competition. It's not just about execution, you can't just take the high road, Uber's taken a lot of low roads to get where they're at. It's basically like the kudzu that grows ubiquitously across the SE United States. Find a tree, climb it, then steal all its sunlight. Look at an existing business, find out what makes it tick, then clone its business model and go after its customers using the same marketing channels its using. I don't think you'd have to read many business books to find an account of this happening, albeit with non-software products. It works because customers simply don't have the bandwidth to be loyal or to thoroughly research everybody they do business with.
    - tokai 8y ago
      >I don't think you'd have to read many business books to find an account of this happening, albeit with non-software products. So it's a general problem with businesses and not a valid argument against FOSS alone then. That being said I don't see "uber for x" companies to be a danger for legit businesses. To me it seems more of a way to milk investors, and not a viable way to steal markets. Most systems have a potential for agents to act badly, but it is my lay understanding that game theory have shown cooperative strategies to win out.

vinceguidry 8y ago

> The third part, "our competitors will fork and steal our business!", is possible, but extremely unlikely, unless you suck at your product. I don't think you appreciate the danger here. Someone can sink a few tens of thousands of dollars into cloning a codebase, then make it to market in a bare fraction of the time it took you to get there. When you say "incumbents don't get unseated without tremendous effort," you're referring to big incumbents like Amazon or Google, or CVS or Home Depot. Sure, at that scale it's impossible to ramp up that quickly. But for small outfits struggling to survive, handing the jackals everything they need to compete with you is flat-out stupid. The barest vestige of a moat, something as small as locking your doors, can be enough to get the jackals to pick easier targets. Having to manage the creation of a software product is an order of magnitude harder than just cloning it and differentiating it from there.

peterwwillis 8y ago
You can claim a lot of things that don't happen are dangerous. Skating on ice is dangerous, because someone could bring out a flamethrower or napalm. Flying on a plane is dangerous, because someone could fire a shoulder-mounted rocket at your plane. Eating food with a fork is dangerous, because someone could come up behind you and slap the fork into your throat. All of these things are dangerous possibilities that do not happen. AFAIK, small startups do not get unseated by other small startups that poach their technology in order to ruin their competitor. Besides being quite unethical, it's very bad PR. Not to mention, someone else would have to be in the same position, ready to take the same risks, on the same business model, with the same technology, at the same time. Risky things happen. But so far, I am unaware of this particular risky thing ever happening. I would love to hear if it has happened before. (I will add the caveat that if anyone were to do this, it would be China)
- vinceguidry 8y ago
  The HN crowd tends to stay outside of these kinds of business circles, but I have a friend who doesn't, and he would ping me from time to time about "cloning a site and building a business around it." It took me awhile to understand the mentality. But "Uber for X" is very much a thing. We just don't pay attention to them because those companies never reach Uber growth. But you don't get to be Uber by just acquiescing to competition. It's not just about execution, you can't just take the high road, Uber's taken a lot of low roads to get where they're at. It's basically like the kudzu that grows ubiquitously across the SE United States. Find a tree, climb it, then steal all its sunlight. Look at an existing business, find out what makes it tick, then clone its business model and go after its customers using the same marketing channels its using. I don't think you'd have to read many business books to find an account of this happening, albeit with non-software products. It works because customers simply don't have the bandwidth to be loyal or to thoroughly research everybody they do business with.
  - tokai 8y ago
    >I don't think you'd have to read many business books to find an account of this happening, albeit with non-software products. So it's a general problem with businesses and not a valid argument against FOSS alone then. That being said I don't see "uber for x" companies to be a danger for legit businesses. To me it seems more of a way to milk investors, and not a viable way to steal markets. Most systems have a potential for agents to act badly, but it is my lay understanding that game theory have shown cooperative strategies to win out.