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July 04, 2006
Open Source: It's Not A Space - It's Not A Category
A handful of European VCs are quoted on their views on open source in Computer Business Review today. All agree that open source is the new model for software firms - both in terms of the way software is developed (by a community of volunteers) and the way software will be distributed.
None of the VCs quoted would be the ones that you would go to with your on-demand software business, we take it.
Bernard Dalle, a GP at Index Ventures:
"We anticipate it's going to be very hard going forward to invest in closed source, because we don't think it's a good development model."
Robin Vasan, managing director at the Mayfield Fund:
"We don't see this as a space, we're not calling this a category. We think this is an integral part of the industry today."
Frank Bohnke, general partner at Wellington.
"Ultimately these open source companies have to prove that they can build brands, they can sell, and they can build profitable companies. I don't think there are many companies yet who can do that and prove the theoretical benefits of open source."
And we would add that there would need to be a few more good sized exits (in this cycle) in the open source market before VCs can say that it has proven to be the best business model for venture-backed software companies.
Read - VCs expect open source to be default option (computer business review online)
Posted on July 4, 2006 01:38 PM | Posted to Software | Permalink
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