Funding Open Source with Marketing Money

Often times as developers we see funding open source as a charity. We will give our personal money to projects we believe in. If we’re lucky, our company might have a matching program for our donations. This has proven not to be a sustainable way to support open source.

Funding Read the Docs

Over the years working on Read the Docs, we’ve tried a large number of ways to get sustainable funding. We’ve done:

  • Donations
  • Corporate fundraising drives
  • Support contracts
  • Contracting on documentation tooling
  • Training for documentation

However, at the end of the day doing this work takes away from the primary goal of providing a documentation hosting site. These are all side-businesses that take time and focus away from our primary goal as a project.

Charging money for our product doesn’t work, because our users are mostly working for free producing open source software. These are the last people we would want to charge money, because they are already working for free.

At the end of the day, we’ve settled on advertising as the way forward. We believe that advertising aligns with our incentives as publishers: the more projects and users we serve, the more money that we’re able to make. It also is the only viable business model that seems to work for large, free websites on the internet.

We aren’t building a traditional advertising business. We’re embarking to build a model that respects users, and we’re calling it Ethical Advertising.

Traditional Funding Sources

Saying that we’re building an advertising business to support open source isn’t overly interesting on it’s face. However, I want to look at this from a different perspective in terms of where the money comes from. This Ford Foundation report goes into much more depth here, but I want to cover it in broad strokes.

Historically, open source funding has come from:

  • Donation budgets from individuals, who are very likely to also produce Open Source themselves
  • Donation budgets from corporations, which are vanishingly small
  • Technical budgets from Engineering organizations within corporations

The last one is the least obvious. Fitting donations into your expenses forces OSS funding into something that appears to be a legitimate business expense. This has been in the form of “enterprise licenses” which provide no benefit, toothless “support” contracts, or other tricks to make the money come from another source in the budget.

You’ll notice a trend in the above funding sources:

  • They are generally one-time payments instead of recurring
  • They are the first expenses to be cut
  • They are generally less than 1% of total budget

Marketing Money

Open source funding has been attempting to scrape by with a tiny percentage of the overall company budget. In a lot of tech companies, the marketing and sales teams will account for up to half of the budget for the company. This money has been generally untouched by open source funding.

Focusing on doing advertising allows us to use this huge pile of money, and redirect it to fund open source software. We’re unlocking a source of funding that was traditionally closed off, and which has a lot more money.

Trying to create a new line item in a budget for “open source funding” is a pipe dream.We need to find a way to fit open source funding into existing budget items, and in a way that is legitimate and ongoing. We need to make sure that our funding isn’t on the chopping block at the first sign of a downturn at a company.

By providing value to marketers, we make sure that our budget isn’t the first thing to be cut. Instead of being a charity, we’re entering into a business relationship where both sides come out ahead.

Help Us Help You

If you work at a company that sells to developers and believe in the work that Read the Docs does, it would be great to send a link to your marketing folks. We have an audience of developers that almost certainly is interesting to them, and the money that might have historically gone to Google or Facebook will go to a worthwhile open source project.

We’re building an advertising platform that is ethical and open source. We hope that you will join us in this mission. We plan to lead by example and build a sustainable business model that respects user privacy.

Join us in this mission to make an advertising business model that works for open source, advertisers, and users.


Originally published at ericholscher.com on August 31, 2016.