Business and open source…

Standard

Ashlee Vance wrote a story in today’s nytimes.com (I presume it’s in the print edition too ;-) about the business world’s supposed disappointment in the shareholder value of open source based businesses.

I suppose if you ignore all of the companies listed in the article who were sold for hundreds of millions of dollars, and you squint really hard, you can see their point: investors in open source companies in aggregate haven’t made as much money as investors in proprietary software companies. Given how short the age of open source has been, that’s hardly surprising. (Given how open source is missing the boat on services-based businesses, that’s also likely to continue, but that’s another story).

Others will I’m sure criticize the article based on proposing some better metrics for success for investors in open source companies. I don’t really care — what did strike me was this sentence:

The fight illuminates a larger truth about open-source companies: their societal and strategic importance far exceeds their financial value as operating businesses.

Exactly! It’s critical to me as CEO of Mozilla Messaging that it be a healthy business. But my requirements for “health” aren’t those of wall street. They include reaching a state of making more money than we need to operate, but they also include some variation on the triple bottom line, with some additional twists related to making sure that we operate in ways that are consistent with our values.

I was recently at a business meeting where a bunch of CEOs were “networking”. It was fascinating how quickly the conversation shifted when I answered the usual question about “exit” (the polite term for: “get rich by selling the company) with “well, no, I can’t, as we’re owned by a non-profit”. After a period of shock, it turns out that even CEOs (!) are interested in a business that isn’t all about financial rewards for shareholders. It can be about much more interesting pursuits, such as building a team of people who respect each other and work together for a common goal; it can be about providing awesome customer experiences; it can be about making the world better. There are lots of companies like that. It’d be nice if the “business” section of the newspaper spent more time thinking about that and less about how people who are merely shareholders can make money through speculation.

It’s probably healthy for Wall Street to realize that what’s interesting about open source isn’t some magically cheaper way to produce goods and services. To me, what’s much more important are the complex implications like transparency, a permeable barrier between your consumers and your staff, a built-in safeguard against complacency, and ideally a much more human relationship between your organization and everyone else. I look forward to seeing what the Economist’s new Schumpeter column on business says about it, whenever they get around to it.

In the meantime, I’m looking forward to exploring how to work with business-savvy types who are interested in how to make a deeply healthy business. Based on talking to other CEOs of open source companies, I’m pretty sure that just like we can find talented programmers, quality nuts and localizers to contribute to the products, I’ll find some smart business types who will find it rewarding to contribute to the business challenges.

One thought on “Business and open source…

  1. Given how open source is missing the boat on services-based businesses, that’s also likely to continue, but that’s another story.

    How is MoCo or Mozilla Messaging catching this boat? So far, it seems to have eluded the grasp of anyone in anything shipped?

    I suppose Weave may eventually qualify and Raindrop, if Mozilla Messaging wants to host mail, but I’m not sure where otherwise.

    I was excited by the idea of providing a “My Mozilla” home page with some services for our community a year or two ago but that never seemed to go beyond vague talking about the overall costs of doing so without much development of how to get it to pay for itself.

Comments are closed.