Last year was the first time I heard of an open-source startup as SaaS.
I didn’t even understand what it meant. How do you monetize such a thing?
Everybody can come, take your code and compete with you.
I couldn’t even understand how we get from GitHub stars to customers 🤯
But that was one of the craziest growth I have ever seen in my world of entrepreneurship.
If you are planning on building a SaaS, make it open-source.
Are you like me? 🤷🏻♂️
There’s a high chance that you are like me, a developer that consumes open-source but has never been a part of the open-source community - when’s the last time you contributed anything?
If that’s true, then you don’t know what an open-source community is.
I had built startups before and usually had to build the community around me.
But in open-source, it was different. There is a community already just looking at where to contribute to. This is exponential growth; it’s better than any marketing.
99% of most of the enterprises we signed said they heard of us from a friend.
Everybody can come and take your code 🙀
It’s true, but it doesn’t matter. When people take your code, they expand the market - that’s good. In the end, the best marketing/product wins, and we will dominate the market :)
There’s a new market opportunity 💹
People always try to create their blue ocean inside of their red ocean - with open-source, you can. Let’s look at Cal.com. They are an open-source alternative to Calendly. They have gained massive growth, enough even to replace Calendly in the future. Once you tap into open source, you have removed your competition and created a new market. Here are a few reasons why:
- Developers can use and integrate them into their internal systems.
- Developers can see your code and gain your transparency and credibility.
- Developers can change your system to their needs.
Novu - the open-source notification infrastructure 📳
I joined Novu in 2021. I met the founders in a coworking space, and we worked on different products. They had the same product as today but as a normal B2B SaaS. It didn’t work for them, and I was sad seeing this. But one day, something changed. They pushed some of their code to GitHub and posted an article about what they want to build on the DEV community. They got trending on GitHub with 2000 stars in 4 days and raised $6.6m (after covid) in a month.
I sold my company (I was working on back at the coworking space), and two months after that, I joined the company 🎉
We had a very fruitful year 🍇
We have grown from 2k stars to 20k stars. It’s very uncommon for companies to grow at such a speed we have even signed a partnership with GitHub. And closed a few enterprise deals (in the first year).
We did an entire year of growth, a sprint from week to week of bringing traffic and community member to our GitHub library.
Many people asked me how we did it since:
- We almost have no followers on social media
- We never ran any ads
- We barely have any SEO.
I feel we were kind of cheating because, really, nobody understood how we were growing so fast.
Trend every week 📈
Do you know this magical moment when you write a tweet, and suddenly it becomes super trendy? Until today, it happened to me once (actually, a pretty stupid tweet). It’s definitely not happening a lot, and it was not in the context of any agenda.
How good would it be if you trend every week? How much growth would you get from that? We did it repeatedly, over and over - just not on Twitter. We did it on GitHub.
Almost any marketplace has this trending thing:
- Shopify
- Wix
- Webflow
- AppSumo
And they all have the same concept - get a lot of sales in a short period of time, and we will promote you - it’s good for them, they make more money.
But the GitHub marketplace (trending tab) is a bit different.
It works on the activity of your GitHub library. The more engagement you have (from different resources), the higher chance you will trend - and with each of those trends, we got thousands of stars and users.
Developers grow companies 👩🏻🔬
With Novu, we got from 2k stars to 24k stars.
I had a chance to work with a few more companies. Here’s some of their growth.
Wasp managed to get 4000 people to use their GPT code agent from a single article.
Now they post every week on DEV and experience constant growth.
LiveCycle, built an external product called Preevy. They are almost at 2k stars and have already benefited from more community members and customers!
Gitroom ⭐️
I have set on a mission to help people grow through open source by giving weekly knowledge.
This newsletter is good for you if:
- You are considering open-sourcing your product (or building a new one).
- You are considering opening a by-product and open-source it (to reflect on your main product).
- You are in tech and want the growth without the stars / without GitHub trending.
It’s a 100% free newsletter (and always will be). Feel free to register at:
Will you open-source your next startup?
Latest comments (39)
Thank you @nevodavid for this article, it's truly inspiring. You just provided me with valuable insights for a product my team and I are developing. Open source remains undefeated!
I may be late, but I want to join the discussion too, here are two project as my first step on the open source community. Both are on building state.
I couldn't agree more with the idea that startups can benefit immensely from embracing open-source technologies. As a passionate advocate for open-source solutions, I've witnessed firsthand how it fosters innovation, reduces costs, and accelerates development.
At Coding Crafts, we firmly believe in the power of open source. As a leading Software Development Company in USA, we've integrated open-source technologies into our projects to deliver top-notch solutions for our clients. It's not just about cost-effectiveness; it's about tapping into a global community of developers, harnessing their expertise, and creating robust products that stand out in the market.
In fact, being recognized as the Best IT company in USA wouldn't have been possible without our commitment to open source. It has allowed us to stay agile, adapt to changing needs, and deliver high-quality software that transforms startups into industry leaders.
So, I wholeheartedly endorse the idea that startups should build on open source. It's a strategic move that can set your company up for success, just as it has for us at Coding Crafts.
We can all delves in closed source project,
And open-source where heart is.
niceeee
60% agree with you @nevodavid
How do you turn GitHub ⭐️ into 💵?
What’s your monetization strategy? You host it and ask for subscription?
Specfically for Novu - the cloud version and enterprise features are the ways we chose to monitize.
Really product dependent
Great article, Nevo. The value of code is getting negligibly small. Especially after the rise of LLM.
Love this article! We’ve been considering open-sourcing portions of Startup Wars so that other developers can use our startup based financial calculations.
Would anyone here find that useful? Such as equity calculations, tax calculations, HR, marketing, etc as an API.
While I applaud those who see the opportunity to leverage open source within their business model, I respectfully disagree with the premise that all startups should make their products open source on several grounds:
Like many options in development and business, the OSS business model is just another tool in the toolbox that we've assembled over the course of our careers. We have to exercise good judgement to understand if it's the appropriate tool for the job and not treat every problem with a golden hammer.
As an alternative, I am very supportive of all businesses looking for ways to contribute back to the open source community. Many of us have developed quality solutions internally for mundane processes that provide no tangible market advantage for our products (beyond making the product higher quality); packaging these and pushing to public registries does help the overall ecosystem and helps build some brand awareness through the means mentioned in the article.
Hi @nevodavid
Very interesting article and your growth looks quite impressive.
But I doubt a bit it's really repeatable and a lot of developers are ready to work on most projects.
Same as other people on comments, I'm builind and Open Source startup (azimutt.app - github.com/azimuttapp/azimutt), helping developers exploring their database schema, but despite having more than 1000 users and always great feddback, I don't really see contributions or even opened issues.
Do you have additional suggestion to foster this community?
Thanks!
You've hit the nail on the head! 🚀
Starting a new venture is like embarking on an epic quest, and open source is the magic elixir for startups. Here's why:
Cost Efficiency: Open source tools and libraries save startups precious resources. It's like having a treasure trove of software without the dragon-sized licensing fees.
Community Magic: Open source projects thrive on collaboration. Tap into the wisdom of the crowd and build upon battle-tested code. It's like having a fellowship of developers at your side.
Innovation Accelerator: With open source, you stand on the shoulders of giants. Leverage existing projects and focus on what makes your startup unique. It's like wielding a legendary sword!
Transparency & Trust: Open source fosters trust. Your users can see exactly what's under the hood. It's like a transparent knight in shining armor.
So, here's to the brave startups wielding the open-source Excalibur! 🗡️
Cheers to innovation, collaboration, and the journey ahead!
I love open source but I think we fixate on GitHub stars too much. Contributions, forks, issues opened, plugins created, blog posts written would be a better metric - of course much more difficult to measure.
GitHub stars is a vanity metric that is easy to manage.
All the other ones are reflections of this metric.
If you have X amount of stars you will have ~Y amount of contributors.
I disagree with the correlation.
Stars measure attention, not usage.
Contributions are correlated with usage.
Attention is correlated with hype.
Sometimes they go hand in hand, sometimes they don't.
JUST WOW @nevodavid
😻
I built an SaaS startup exclusively on Open Source. When my VC fund violated our contract, refused to pay me and my employers, we just took the code and started a new company 😁
Today 5 months later the original company is worthless and we're starting to make money. If it continues according to current projections, we'll have a Unicorn in 6 months 🥳
There's one born every minute 😂
ainiro.io