Creating a business using open data

Open Data isn’t new but as time goes by, it gets more available and its quality keeps increasing. By definition, this data is free but is there a way to create value and launch a sustainable business using it? For some the question is even tougher: how can we expect to generate revenues when what we sold until now is now free?

In this article, I intend to share an experiment: Firmapi and its alternative Corpinfo. It is still in progress but we already learned a lot and I wish to share it. This service is very simple: we provide a database of french companies through an API or as a simple CSV download.

Simplicity is a feature

The first lesson we came across was also a great news: With Open Data, public administrations aren’t in charge of making the distribution great. They don’t care if their API is well built and in fact they rarely have one. They can’t be blamed because doing more isn’t something we want them to invest time or money in.

That’s when businesses can actually provide real value. Simplicity and ease of use is a service in itself. In our case, the data was weirdly compressed XML uploaded on an FTP. Parsing the data was a nightmare. Being able to provide a consolidated database of companies (one per line) was enough to generate revenue. Our customers could try to build this themselves but why bother?

Finding the right pricing when the data is free

Obviously, the data is free so they could build a clone. This is of course the greatest concern and shapes the way you build your pricing. Several factors have to be taken into account:

• Is it hard to estimate the amount of time required to build the service?
• Is it a recurring or a one-time need?
• Does creating the service requires specific skills that might not be found in a usual team?

With Firmapi, we also decided to create a free plan. Part of the reason is that most users won’t need it enough to make a purchase, but would gladly use your service at a small volume. If done right, they will spread the word at no cost. The other reason is that Firmapi exists because the data is open and we’re happy to give back when we can!

When building the pricing, we obviously asked ourselves what plans we should offer. In the end, we went for simplicity — after all that’s one of the main reasons customers come to us. If you pay you get to make as many API calls as you want. It makes everything so much easier for our users and they in fact never ask us any question regarding this.

A great investment

So what about the results? We launched the service in late august. We’re now adding new API users daily and making sales every few days. We don’t expect it to become a major revenue source but for the small development time it took us, and the minimal maintenance, it was a great investment!

Originally published at antoine.finkelstein.fr.