How to Make Money With Open Source Software

Open source software is everywhere, and if you want to make money from your great code, open source is the way to go. This book will show you how to create a winning business model backed by real-world scenarios, patterns and lessons from successful people – like Linus Torvalds and Scott Meyer – who are making money with open source projects and companies.

The money making opportunities with Open Source Software seem almost too good to be true. Thousands of people make a living by distributing free software, but how is this possible? Anyone can contribute to an open source project for free, yet many developers ask for money for their contributions. How does this work? What does it take to start your own business that contributes to, or even sells, Open Source Software?

Offering paid support is one of the most straightforward revenue streams for all kinds of open source projects. As a project maintainer, you have a lot of knowledge about the codebase. This puts you in the position to offer consultancy or support services to companies that want to use your code. 

On the other hand, offering paid support doesn’t provide a scalable business model for open source projects. Because most projects are maintained by a few developers, there’s limited time for them to offer support to companies. Bear in mind the time required to improve the functionality and maintain the codebase. 

In conclusion, it’s an effective way to earn some money as an open source maintainer and keep the project going.

Sharetribe as OpenSaaS

Sharetribe, a marketplace builder, is another great example of an OpenSaaS product. It comes in two versions: a self-hosted free version which can be found on GitHub, and a cloud-based hosted version at sharetribe.com. With the SaaS version of Sharetribe, customers receive software hosted on Sharetribe’s servers along with full-cycle support and maintenance, from installation to backups. With the SaaS version, customers don’t have to worry about updating their software, as this is done by Sharetribe. But while the SaaS version receives great support and additional offerings like custom domain and removal of Sharetribe branding, this version of Sharetribe is less customizable, only allowing you to personalize marketplace filters and change colors, images, and block position in the user interface.

With the open source version of Sharetribe, on the other hand, the customer has to deploy Sharetribe on their own server and run updates and backups themselves. The GitHub community offers decent support, but ultimately you’re on your own.

Though there aren’t many examples of OpenSaaS products on the market today, we feel that this business model is just beginning. The term ‘OpenSaaS’ was only coined in 2011 by Dris Buytaert, creator of Drupal. OpenSaaS is an exciting new trend that combines the best of both worlds, allowing people to build web experiences more easily than ever.

How developers can make money with open source projects

Bug bounty programs

Bug hunting, or as it’s usually known, bug bounty programs, is a way of earning money either by reporting errors on other systems or by solving them and submitting your pull requests with the code that fixes them. These programs are usually part of the entire vulnerability audit of the software being tested and accompany other internal processes the developers are implementing.

There are very big companies who submit their products for this type of treatment, and when we say “big,” we’re not kidding. With a basic search, we can find some interesting options, but in order to keep with the theme of “making money from open source,” here are some examples of high-paying organizations with bug bounty programs on their open-source products:

  • Mozilla: They have two main programs, one for their actual software and one for their websites. Offering to pay up to $10,000 on the first one and up to $5,000 on the latter.
  • Apache: This web server is probably known to most (if not all) back-end developers. Through its program it pays bounties of up to $3,000 to those able to solve the most critical bugs.
  • Google Android: Also interested in making the most stable and secure mobile OS out there, Google offers up to $150,000 dollars for the most critical problems found and solved (yes, you read that number right).

There are many different lists of bug bounty programs, but you can find a good, up-to-date one on this website. Overall, this option is quite lucrative if you are able to put in the hours. That being said, you also need to specialize your knowledge and focus on security bugs if you want to reap the big rewards.

Last but certainly not least, aside from bug bounties, you can also get paid by fulfilling OSS (open-source software) bounties over at BOSS, a relatively new initiative that has lots of potential. Here, project owners can submit development tasks that they pay for on completion. This is certainly not as lucrative as the above programs but also requires less of a focus on security and can be tackled with a more generic software development profile.

Software as a Service

An open source project that has generated plenty of demand can choose to offer a Software as a Service (SaaS) business model. This model is most viable for projects that offer a complete application, such as a publishing platform, monitoring tool, or marketing automation tool.

Developers can choose to host the software themselves. However, this means that they have to take care of security, security, and maintenance. 

It’s often much easier and cheaper to pay for a managed offering under a SaaS model. Developers pay a monthly fee to use the hosted solution. Therefore, they can focus on the tool itself instead of all maintenance-related tasks. Moreover, a marketing or content team often doesn’t have the required technical knowledge to host a solution themselves. For that reason, a SaaS solution is a great alternative to make money from open source software.

Dual licensing

Dual licensing allows companies to release commercial software (with a commercial license) that’s derived from free OSS commonly distributed under the GNU General Public (GPL) license. Dual licensing can be implemented in a few ways. In the first scenario, a company releases identical products under a commercial license and under a free license like GPL. In the second scenario, the company releases different versions under different licenses.

So what’s the point of dual licensing? The GPL license allows end users to run OSS, redistribute that software, and modify it. However, you can’t embed OSS solutions into your proprietary (commercial) software and make profit under a GPL license. This is precisely where you’ll need a commercial version of an open source product to have the right to sell your commercial software.

The most well-known example of successful dual licensing is MySQL. The company releases MySQL Enterprise Edition, MySQL Cluster CGE, and MySQL Standard Edition under commercial licenses while still offering two other products – MySQL Classic Edition and MySQL Community Edition – under the GPL license. The commercial versions receive enhanced security features, backups, 24/7 support and more.

Conclusion

This book is for developers who use or would like to use the power of open source software to create a profitable business. It explains the benefits of open source, how to find and distribute open source software, and details how to develop a business around free and open source software.

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