IndieHackers - 🗞 What's New: The fear of open source

Struggling to decide between open and closed development?

• Many founders shy away from open source for various reasons, but it may be time to take another look. Founders weigh in below with valuable advice on both sides of the open source debate.
• Introducing a paid tier for a free product can be tricky. These tips can help you tweak your pricing and explore different ways to monetize!
• Founder Rikki Pitt works full-time, while maintaining a cadre of side projects that are bringing in a combined total of $4,500 in monthly revenue. Below, he shares how he maintains all of his side projects, and his tip for leaning into marketing as a developer.

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😬 The Fear of Open Source

by Francisco

As a developer, I am struggling to find a balance between open and closed development. My MVP is very rough around the edges, and the first audience will be techies who are comfortable with low-code tools. Why? Because making something usable for non-techies takes a ton of extra polishing.

I know that there are plenty of apps and websites that do not publish their code, and I want to avoid the pain of choosing a license too early, and potentially regretting it later. It seems easier to start fully closed, and open up slowly, than the other way around.

Have you faced a similar dilemma?

Popularity contest

Manish Vachharajani says that there is something major to consider if you are primarily interested in building a business:

Ultimately, businesses are about making money, and open source does not directly make money. Therefore, the role of open source in your business must ultimately drive paying customers. That can happen through the marketing benefit of having a popular open source project, which is having users who need add-on products or services, or consulting services. All of this depends, however, on having lots of users for your open source software, and that is where the challenge comes in.

The big challenge with open source is that you have to make it popular. To make it popular, you have to produce something that is very useful on its own. Otherwise, people will not use it. Oftentimes, that means the vast majority of your users will have no need or want for your paid offering. In fact, the more popular the open source, the bigger the problem this is. The trick is building enough open source that it is popular and useful, but not so much that you cannot monetize things.

If the effort to market and popularize the open source is just not worth the trouble, you should go closed source. You may find it hard to make something useful for non-techies, but the truth is, those are the people that will pay the most because you've solved a hard problem for them. It may be worth leaning into that audience and just doing the work to build an MVP for them. It is hard to say what the right answer is without the benefit of hindsight.

The odds are in your favor

Loïc Dachary has made a living publishing and using exclusively free software since the mid-1990's:

Here's one thing that I've learned: The odds of a competitor using your codebase to run their own business in way that will effectively hurt yours are virtually nonexistent. It is theoretically possible, and there are a handful of spectacular examples, but it's highly unlikely.

Don't let that fear dictate how you approach free software!

Justin Ferriman agrees:

Don't be afraid of open source. I built and sold a seven figure business on WordPress. The code was there for the taking, but that didn't matter. Check out this breakdown that I wrote about the sale!

Battle scars

Dylan Wilson ran an open source project for five years, and has scars from sinking thousands of hours into it, while getting very little in return:

I think the problem is that people confuse "open" with "free." Unfortunately, supporting an open source project takes a lot of work, and the burden grows as it gets more popular. It's very asymmetric in the wrong direction.

For the record, the open source project that I started many years ago is still alive and well, I'm just not part of it anymore. Other people are supporting it, though.

My take on open source is that it creates trust because it's very clear what people are getting. They can verify the source themselves, or at least assume that someone else has verified it.

There are actually some ways to monetize open source that have worked for some people. The first way is the open source hosted model. A great example of this is Plausible Analytics. The idea is simple: Keep the code open source and offer paid hosting, so people don't need to run and manage their own servers. This works well for web-based projects, but not much else.

The second way is the Patreon and GitHub Sponsors model. The best example of this that I can think of is Vue by Evan You. In my opinion, the reason that this model works is because the market for this kind of thing is massive, Evan has a good reputation, and many companies use Vue in their tech stack.

I haven't seen anything else work well, but I'd love to be surprised!

What are your thoughts on open source? Let's chat below!

Discuss this story.

📰 In the News

from the Volv newsletter by Priyanka Vazirani

👩 Roblox plans to grow up with its users...new opportunities for founders?

🤩 Web3 is blurring the line between fans and creators.

📈 Modern-day slavery has increased by 10M people in the past five years.

🌵 Extreme weather is driving companies to try making wine in the desert.

🥊 Instagram and TikTok are going to war at New York Fashion Week.

Check out Volv for more 9-second news digests.

💭 Exploring Pricing Solutions For Your SaaS

by Tuan Cao

I'm working on perfecting my pricing structure for my product, which converts web articles into audio (text-to-speech) with a natural voice, then sends it to a private podcast feed.

Since I introduced the payment feature about a week ago, no one has paid for it yet, and user engagement has decreased quite significantly. I'm concerned that I may have ruined things by introducing the wrong pricing. Any tips?

Balance cost with value

Lyb says that a good pricing strategy has to strike the perfect balance between cost and value:

If your operating fees prevent you from reducing costs, you can try to increase value for your customers. Regardless of what your product does, content can always be a source of value.

Do you have content that already exists? Gradually building up a library of good articles, blog posts, tutorial videos, or whatever you've created doesn't cost you anything extra. Potential users can get a ton of value, and it leaves them with a good impression about your product.

Here are other possible value-increasing measures:

• Offer curated lists of articles so that users won't have to find the content themselves.
• Branch out: Collaborate with other founders to determine how you can work together to add value to both of your user bases.

Leaning into content can really help with determining pricing, as it adds more value to your product.

Consider various avenues to monetize

Vuk Radic reminds founders that there are various ways to monetize your product:

You do not need millions of users to attract advertisers to your platform.

I would go all in with the ads. Add a completely free, unlimited article, ad-supported tier. People hate ads, so if they really need your product, they will subscribe to the paid tier to get rid of the ads. If they only kind of need your product, they will continue using it and just live with the ads.

By doing it this way, you can use the fact that your product has a free tier to attract new users. Yes, it can be difficult for a solo founder to land advertisers, but it's doable! You can always try to outsource ad sales to an agency for a percentage of the sales. You could also do it yourself by targeting your audiences and selling ads at a low cost to get started. Run specials and packages where you drop the price significantly just to get people to use your product, and get them used to seeing ads.

Keep the pricing simple. Just two tiers: The free, ad-supported tier and the paid, unlimited tier. You can go up in price with this...$15, $20, or maybe even higher. This will be for the users who really love your service, and will pay whatever you ask just to get rid of the ads.

Reevaluate the pain point

YZ_coding says that it's difficult to get consumers to pay for anything:

Be sure that this is actually a pricing issue! It could actually be that you haven't discovered a problem so painful that your users are willing to pay for it.

Jay agrees:

If no one has ever told you that it's too expensive, it's probably not too expensive!

That's not good news, because you want it to be too expensive. Then, you can just lower the price to get some sales rolling in.

I have no idea why people aren't buying, as I don't really have domain knowledge of your market niche, but I'm pretty sure that price isn't the issue. If that's indeed the case, then you need a new idea.

You can't make people feel the pain if the pain isn't there. I know it sucks, but it may be time to move on.

How did you hit your pricing sweet spot? Share your experience below!

Discuss this story.

🧠 Harry's Growth Tip

from the Marketing Examples newsletter by Harry Dry

You're not buying an expensive watch...you're starting a tradition:

Go here for more short, sweet, practical marketing tips.

Subscribe to Marketing Examples for more.

💲 Rikki Pitt's Side Projects Hit $4.5K MRR

from the Growth & Acquisition Channels newsletter by Darko

Rikki Pitt is a full-time Ruby and JavaScript consultant who is also working on a few side projects that bring in $4.5K MRR. Indie Hackers recently spoke with him about his journey, including insights from juggling multiple side projects at once. Read on for more!

What are you currently working on?

My most recent ventures are a pair of email-based products. The first, Paced Email, is a productivity and privacy tool to save users time from endlessly checking their inboxes.

This led to the creation of Vend Email, an email forwarder similar to other relays, like Firefox Relay. The kicker is the ability for users to quickly, easily, and safely transfer or sell their email addresses to others. The benefit here is that if the email has any intrinsic value (i.e. if the account email is on a valuable lifetime deal), you can sell it by escrow.

Other projects that I've built and currently run include:

• Quikk, a Xero accounting platform backup and auditing system.
• Tweex, a way to update website content without coding or CMS integration.
• RFID and R&D claim submission-based products.

Combined, these projects earn ~$4.5K MRR.

How do you stay organized?

Over the years, I’ve become quite adept at building products and sites in Ruby on Rails. From planning and management to scaling, I’ve seen it all. By now, I've built muscle memory, plus I have a set of tools that make it easy to develop and deploy many apps. They all follow similar processes.

When entering a new market or niche, I usually build something for myself to aid in my own workflow or business efficiency.

How do you decide whether to abandon a project?

I don’t think I’ve ever really fully abandoned a project. As soon as it’s out there in the hands of users, I’d feel terrible taking it away just because it wasn’t as successful as I would have liked. As long as the costs to keep it running are minimal, my other products will absorb those costs.

What's your building to marketing ratio?

Originally, like most developers, my time was 99% dev work and 1% marketing. Over the years, I’ve grown to realize that it should be the other way around! Currently, I’m at about 80% dev time and 20% marketing. I’m part of a mastermind group, and we try to focus as much as possible on marketing rather than just adding another feature.

How do you maintain all of your projects?

I’m a huge proponent of adhering to as many security practices as I possibly can. I guard my users' data fiercely!

Generally speaking, Ruby on Rails is my go-to web framework. I make it a priority to keep on top of updates for three main reasons: First, to ensure that any vulnerabilities are quashed. Second, to make sure that it’s easy to upgrade in the future. Smaller steps are easier than one big version jump. Lastly, I get access to new, cool features and performance gains!

Discuss this story, or subscribe to Growth & Acquisition Channels for more.

🐦 The Tweetmaster's Pick

by Tweetmaster Flex

I post the tweets indie hackers share the most. Here's today's pick:

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Special thanks to Jay Avery for editing this issue, to Gabriella Federico for the illustrations, and to Francisco, Priyanka Vazirani, Tuan Cao, Harry Dry, and Darko for contributing posts. —Channing