Guest: Matt Yonkovit (LinkedIn)
Company: Scarf (Twitter)
Show: Let’s Talk

At the core of every technology that exists out there are open-source components. Even closed source, proprietary cloud services are relying on open source as part of its DNA to build that product. Open source has inspired people to start open source projects and take a chance on something new or a little different.

In this episode of TFiR: Let’s Talk, Matt Yonkovit, Head of Open Source Strategy at Scarf, shares his insights on open source projects and the importance of culture in building a sustainable business around them.

Highlights of this video interview:

• Yonkovit sees open source as absolutely vital to the ecosystem. Even if you are building something that isn’t pure open source, or if you have closed-source, proprietary cloud services, you’re still going to be relying on it to build out servers, the cloud infrastructure, development environments, and so on.
• An open-source program office (OSPO) is about helping people realize the culture and understand how to utilize open-source software internally and then contribute externally. It is a program management function or a project management function, where your responsibility is to make sure that everyone is aware of what open source can do for them and that they’re following the processes and the cultural norms.
• Yonkovit’s role as head of open-source strategy (HOSS) is more about getting people interested in open-source software, in general, helping people become successful with their open-source projects. His mission is to help people understand what they can achieve from an open-source perspective and how they can build a sustainable business around it.
• The Scarf platform is designed to help people measure adoption and usage of open source and measure their user bases. So, open source has been ingrained in the company from day one.

Reasons why companies start open-source projects:

• They have an idea that they think other people can benefit from, and they want to bring it out there. It is easily accessible for people to start in the open-source space and get feedback early on.
• They do it as part of their investment strategy. Companies use the open-source model because it benefits not only the founders, but the investors as well.

Challenge for open-source founders:

• Getting from that initial project to an actual product requires you to think a little bit outside the box and understand what the market is looking for, not just your company. This is a challenge for a lot of founders and maintainers. They assume that everyone thinks like them, so they develop software and the different components around it for people who think the same way. When they do overcome that and be a bit more diverse in their thought process, it can help the project grow and scale.

Typical evolution of an open-source company:

1. Day one: The CEO, who is the maintainer, is very passionate. He’s going to do everything in his power to make sure that he’s connected to and part of the community.
2. The CEO will realize that to get to the next level, there is a need to turn passion into something monetizable, especially if investment funding is involved. How do I reach the million dollars in ARR? How do I reduce my churn? How do I gain efficiency? There is a lot of pressure from investors to bring in outside influence.
3. The CEO may be highly technical and may have been developing code forever, but he may not have a deep background in sales and marketing. As soon as they get the next round of funding or they start to grow, they look for someone who’s an expert in sales and marketing. Problem: They will hire smart, passionate people in sales and marketing, but not in the open-source space, or they’re smart and passionate in a different type or stage of an open-source company. When they come in, it changes and/or ruins the culture in sales, engineering, marketing, customer success, or HR.
4. This leads to a lot of people looking at changing licenses, changing policies towards their open-source community, maybe shutting off contributions. They want to turn the project into a business, and they listen to some of those folks who came from an outside organization that may have done that before. It’s difficult when they don’t have an open-source pedigree or even if they do, their open-source culture may be vastly different.

Advice for open-source startups:

• Be mindful of who you’re hiring. Culture trumps everything else. Hire someone that has the same cultural expectations or the same philosophies. Oftentimes, you’re hiring someone because they’re smart or they can sell themselves well. That works for big companies. Example: Red Hat brought in the former CEO from Delta. There was already an established culture and he tapped into it and made it better. When you’re starting up, every hire that you bring is going to change your culture. The earlier the hiring, the more impact they’re going to have.
• Also, when you go higher, especially executives who have been part of the executive teams at other companies, they bring in their own teams. Sometimes, that team doesn’t align with your culture and your plan (how you’re going to go to market and sell to people). That can set you back years or even set your company completely off of its trajectory.

This summary was written by Camille Gregory.