3 ms·

This is basically a question I'd like to have answered as well, especially in a b2b setting. Is it justifiable to use the service of a possibly great startup,

This is basically a question I'd like to have answered as well, especially in a b2b setting. Is it justifiable to use the service of a possibly great startup, knowing that there's a real possibility that it might be sold soon and just be a gear in some other company's product?

magicalist 13y ago
As is usually pointed out in these conversations, that's true of all companies you could depend on, and all companies depend on others. That's why people sign contracts (which usually contain clauses about being honored even if the supplier gets bought out). That also saves you from things like a company you depend on deciding that it's going to compete in your market now: they still have to honor your contract.
e12e 13y ago
I've thought a bit about this, churning around various product ideas. In general I'd say that if it's a typical SaaS, I would probably only trust it with my data, my time (learning curve, adapting workflow etc) if it was a available under a licence that would allow me to self-host it if it was discontinued (or pay someone else to host it for me). This is for stuff like mail, images and other DAM (Digital Asset Management) systems, chat/im, bug trackers/knowledgestores and databases etc. Note, that I don't see any reason to trust Google either. Remember wave? Remember XMPP compatible gtalk? My conclusion has been that if/when I finally get started on my first product, I'll probably license it under AGPL, and make sure there's a realistic self-host story for users -- and then charge for the SaaS/PaaS-bit, but probably not for the client (or server side software under AGPL). Clearly it's a little more challenging -- you might end up with people competing with you for hosting -- but I can't see any other way to build customer trust. Nothing any company would say to me as a customer would make me trust them -- how could I ask anything else from my potential users? Since people still pay for hosted email (even if many, many do run off to freemium services) -- I'd say the business model is viable -- those that can afford to pay, and know that value can be added by proper hosting -- and not having to do everything themselves -- will consider becoming a customer. And I strongly suspect those kind of customers are the best kind of customers. Especially for a start-up. Even though I wasn't a user, the most dreadful death-by-buyout I remember is DabbleDB[1] -- compounded by the fact that the founders went to twitter -- presumably helping with the biggest non-product of our decade -- rather than allowing dabbledb to live on in any form. Also note that having a published API/open protocol/standard isn't enough. For example, the IMAP standard clearly states that message ids aren't necessarily in chronological order. Some IMAP servers make sure that they are and/or that messages are returned in a list ordered by (message) time -- and some will return the message that was latest modified first (eg: a messaged moved into a folder). Some IMAP clients get this right (sort as the user wanted, regardless of server implementation) -- some get it wrong. A small difference (arguably client bug) that can make or break certain use cases and processes for dealing with email. For a b2b setting -- one could reasonably offer source under a different license -- if AGPL seems too open for enforcing whatever business model one has decided on. But I suspect that AGPL would work fine in b2b settings as well. The key aspect is to offer source code and documentation in a form that offers a viable self-help scenario in the case of a bankruptcy or "death-by-acquisition". [1] http://www.youtube.com/watch?v=MCVj5RZOqwY http://www.youtube.com/watch?v=MCVj5RZOqwY
chmars 13y ago
In a nutshell: No, not in a business context IMHO – if only because using a new app or service just to migrate away from it later takes a lot of money and time for a business.
ronaldx 13y ago
> Is it justifiable to use the service of a possibly great startup, knowing that there's a real possibility that it might be sold soon and just be a gear in some other company's product? Asking this question plays into the hands of the tech giants. Undermining the startup ecosystem ultimately benefits them even more than acquihiring.
- moreentropy 13y ago
  I think it's a valid concern. My knowledge of startup culture is very limited, so from what i read here, the usual desired outcome is an "exit" aka getting rich by selling the business. I think that is totally valid for social sites and other freebies, but not for infrastructure services. there is a lot of potential and great ideas in things like hosting, monitoring, crm/helpdesk software etc, and if you're not entering the market with an intention to last, you're actually playing in the hands of tech giants. They're asking a lot of money for crappy and downright ridiculous services (ever worked with e.g. HP Service Center or anything SAP), but give you planning reliability in exchange. With the given startup mindset, you're yielding that market to tech giants.
JohnTHaller 13y ago
ALWAYS have a backup plan when using any 3rd party's product. With a startup, there is a possibility of a given product disappearing within a not too long timeframe due to either (1) selling to another company and shutdown immediately aka aqui-hire, (2) selling to another company and being absorbed into that companies competing product, (3) running out of money and shutting down, (4) pivoting to another vision that is more financially viable but doesn't suit your personal business needs anymore, etc. And if it's a free product, double or triple (at a minimum) the likelihood of any of the above happening.

magicalist 13y ago

As is usually pointed out in these conversations, that's true of all companies you could depend on, and all companies depend on others. That's why people sign contracts (which usually contain clauses about being honored even if the supplier gets bought out). That also saves you from things like a company you depend on deciding that it's going to compete in your market now: they still have to honor your contract.

e12e 13y ago

I've thought a bit about this, churning around various product ideas. In general I'd say that if it's a typical SaaS, I would probably only trust it with my data, my time (learning curve, adapting workflow etc) if it was a available under a licence that would allow me to self-host it if it was discontinued (or pay someone else to host it for me). This is for stuff like mail, images and other DAM (Digital Asset Management) systems, chat/im, bug trackers/knowledgestores and databases etc. Note, that I don't see any reason to trust Google either. Remember wave? Remember XMPP compatible gtalk? My conclusion has been that if/when I finally get started on my first product, I'll probably license it under AGPL, and make sure there's a realistic self-host story for users -- and then charge for the SaaS/PaaS-bit, but probably not for the client (or server side software under AGPL). Clearly it's a little more challenging -- you might end up with people competing with you for hosting -- but I can't see any other way to build customer trust. Nothing any company would say to me as a customer would make me trust them -- how could I ask anything else from my potential users? Since people still pay for hosted email (even if many, many do run off to freemium services) -- I'd say the business model is viable -- those that can afford to pay, and know that value can be added by proper hosting -- and not having to do everything themselves -- will consider becoming a customer. And I strongly suspect those kind of customers are the best kind of customers. Especially for a start-up. Even though I wasn't a user, the most dreadful death-by-buyout I remember is DabbleDB[1] -- compounded by the fact that the founders went to twitter -- presumably helping with the biggest non-product of our decade -- rather than allowing dabbledb to live on in any form. Also note that having a published API/open protocol/standard isn't enough. For example, the IMAP standard clearly states that message ids aren't necessarily in chronological order. Some IMAP servers make sure that they are and/or that messages are returned in a list ordered by (message) time -- and some will return the message that was latest modified first (eg: a messaged moved into a folder). Some IMAP clients get this right (sort as the user wanted, regardless of server implementation) -- some get it wrong. A small difference (arguably client bug) that can make or break certain use cases and processes for dealing with email. For a b2b setting -- one could reasonably offer source under a different license -- if AGPL seems too open for enforcing whatever business model one has decided on. But I suspect that AGPL would work fine in b2b settings as well. The key aspect is to offer source code and documentation in a form that offers a viable self-help scenario in the case of a bankruptcy or "death-by-acquisition". [1] http://www.youtube.com/watch?v=MCVj5RZOqwY http://www.youtube.com/watch?v=MCVj5RZOqwY

chmars 13y ago

In a nutshell: No, not in a business context IMHO – if only because using a new app or service just to migrate away from it later takes a lot of money and time for a business.

ronaldx 13y ago

> Is it justifiable to use the service of a possibly great startup, knowing that there's a real possibility that it might be sold soon and just be a gear in some other company's product? Asking this question plays into the hands of the tech giants. Undermining the startup ecosystem ultimately benefits them even more than acquihiring.

moreentropy 13y ago
I think it's a valid concern. My knowledge of startup culture is very limited, so from what i read here, the usual desired outcome is an "exit" aka getting rich by selling the business. I think that is totally valid for social sites and other freebies, but not for infrastructure services. there is a lot of potential and great ideas in things like hosting, monitoring, crm/helpdesk software etc, and if you're not entering the market with an intention to last, you're actually playing in the hands of tech giants. They're asking a lot of money for crappy and downright ridiculous services (ever worked with e.g. HP Service Center or anything SAP), but give you planning reliability in exchange. With the given startup mindset, you're yielding that market to tech giants.

JohnTHaller 13y ago

ALWAYS have a backup plan when using any 3rd party's product. With a startup, there is a possibility of a given product disappearing within a not too long timeframe due to either (1) selling to another company and shutdown immediately aka aqui-hire, (2) selling to another company and being absorbed into that companies competing product, (3) running out of money and shutting down, (4) pivoting to another vision that is more financially viable but doesn't suit your personal business needs anymore, etc. And if it's a free product, double or triple (at a minimum) the likelihood of any of the above happening.