Why don’t you do it a few times first before advertising it? It’s be quite sad if someone gave you two years of their life and then have you fall through on your end of the deal.
It's because we wanted our team to be aware that we'd have this intention so we don't miss out! If someone leaves PostHog voluntarily to start a new company (i) that's sad for us but is a pretty cool reason to leave and (ii) if we were willing to employ them, we'd be willing to invest in them more.
There are some pieces of missing context I guess. Primarily that we're small still (30 people) so we tend to hire a lot of ex founder / generalist type people (and most are technical) who'd be quite well suited as founders.
For small sites there's a hobby deployment (https://posthog.com/docs/self-host/deploy/hobby) that costs $10/month to host (we can't get it below that at the moment), or we give a lot of free usage away on cloud for smaller sites. I'd stress we're product focussed (product analytics + session recording + feature flags + experiments), and plausible is web analytics (Google Analytics alternative), so choose accordingly!
(I'm a PostHog cofounder - we get about 35% of revenue from (2) and 65% from (3) below)
There are three established ways to make money from open source if you're thinking about this.. my default recommendation would be the exact model Plausible uses today - (3) below, if you are just getting started and either bootstrapped or VC backed in today's funding environment.
1. paid support
Advantages: (i) no need to build any extra features or set up hosting for your customers up front - low risk of wasting time in case you don't get product market fit with your paid product (ii) probably a good way to get close to users, as long as you don't end up over-fitting to 1 or 2 edge case use cases (who are, likely, those most likely to need paid support) - however, this will happen naturally if you set up a slack/discord community and you help people out for free
Disadvantages: (i) you are no longer a builder, so you're not doing 100% leveraged work, so the margins are slimmer (ii) will take some time to get to revenue because you will need a reasonably popular project to get much demand (iii) this will be hard to fund if you want to do the VC route, there are exceptions though
2. extra, paid self-hosted features
description: you have an open source project, and users can buy premium features on top for a fee of some kind
Advantages: (i if you target enterprises who don't want to send data outside their environment who don't want to buy closed source SAAS products - they can try + buy much your product faster than your competition's
Disadvantages: (i) it's hard to avoid customers expecting support managing the instance (just because they're paying you, even though you "just" sold extra features) (ii) you have to build a lot since you need an open source product and a paid product on top - so it needs a lot of investment to do this without hurting the open source project's value (I'd strongly recommend you get VC if you do this option, as you'll probably find bigger order values but slower sales cycles as well as all the building work) (iii) many people think everyone is moving to cloud, but we've seen there is a ton of underserved market here (more than enough to get to $100M+ revenue in our market at least), and increasing legislation around user privacy is keeping pressure on here
3. paid hosting of the project
description: you have an open source project, and users can pay you to host it for them
If you are bootstrapping or even VC backed in today's funding environment, I'd recommend defaulting to open source project _and_ a cloud hosted version as your paid version, unless there's a good reason not to.
Advantages: (i) this is the fastest way to monetize (ii) for users without self hosting needs, this is likely a better user experience - less work to manage, so you may just grow a lot quicker initially
Disadvantages: (i) you need to manage the hosted version (ii) at a product level, you are potentially competing head on with closed source SAAS
It looks like PostHog uses a permissive license (MIT). For business model (3), how fo you defend against other companies taking your project and selling a hosted version themself? This was a problem for Elastic and AWS, iirc
There is a range of paid extra functionality that isn't MIT licensed (the extras that make up part 2's paid offer above), so if AWS hosts it "competitively" it'll be missing many of the extra features larger organizations would want to buy. If we didn't have these extras, we'd probably need a non permissive license or a belief that AWS competing like this would increase awareness so much it could be a good thing.
I've always wondered how you manage this (2) tech-wise.
Here are my contradictory hypotheses:
- I don't expect to find the code for such features in the open-source repo
- I guess you dogfood your own product and therefore host exactly what you publish in your open-source repo
How do you "plug" these closed-source features to the product? I've always been curious of this as I strongly believe in this way of doing business for a SaaS.
PS: amazing company ~you've built~ you're building, GG ;)
Had this happen (random outreach). Led to a series A.
Respectfully disagree - I don't think competitors copying is a significant risk early on, compared to running out of money whilst trying to hit product market fit.
While both are anecdotes, I think the original warning is the more important one as it's not the one new founders will expect to encounter. Nothing wrong with taking the call, but be aware of the risks and do a bit of homework before you share anything mission critical.
Fair point, maybe I formulated that a bit drastically, though I have seen this kind of reconnaissance increase quite a bit recently, so maybe I'm just fed up with it.
based on your anecdote against hundreds of thousands of founders getting spied on. I've seen it happen.
Basically if somebody wants to invest ask them: $ and t+
If they try to dodge or make up excuses, MOVE ON. IF they say if you give me A,B,C and then we can invest, ask them to put them in writing and put an exit fee. If they do not invest, they give you 1% of the proposed amount.
Somebody who is serious and has the balls won't waste time. Unfortunately rare.
I've wasted a two years of my youth because a VC on HN reached out to me, who ultimately just used my product/coding services.
Any dumb fuck can be a VC if they can raise cheap capital. Remember, there is very small group of VCs that know what they are doing. The rest are just in the game to spray and see what sticks on the wall (most of them do not make it during a downturn)
It's hard to draw conclusions one way or another because there are so many variables. A good heuristic is that if you aren't speaking with a partner, your risk of having your time wasted (at best) is far higher.
Thanks HN: I'm James - I'm a cofounder of PostHog (popular open source project), which was born on HackerNews in 2020
Along the way, we created a Slack group that quickly grew to a couple of thousand users - mostly needing support with the product. At the same time, we saw signs that docs are critical. For example, people who searched our docs are 8x as likely to succeed with our product.
Then we asked ourselves - why not make it possible to ask questions, right in our docs?
Out of 100s of thousands of visitors, only a small percentage make it into Slack (and it'd be the same if we used Discord), so can we serve questions and answers in the context of what they're trying to do. As a bonus, this would also make everything searchable.
Then we asked ourselves - why not also make this open source for anyone to use?
This means that far more people can benefit, and it'll generate word of mouth growth about who we are - hopefully bringing some extra customers in the long run. Simple as that. We may charge if we get lots of usage and once the product is more mature for the cloud version. If it's not popular, we're going to be using and extending it ourselves anyway :)
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For anyone reading with children... My daughter has cancer in her eyes. The only symptom was a barely noticeable squint despite it being very late stage (and then suddenly, dilated pupil and a color change in her pupil). In theory, the other symptom would have been a white reflection in her pupil had we ever taken a flash photo.
PostHog has iOS/Android/Flutter/React Native libraries for analytics - full details https://posthog.com/docs/integrate#client-libraries. We don't have session recording / feature flags everywhere yet though (I work there)
Do the PostHog Android and iOS libraries automatically collect & report metrics like OS version & app version so I can easily track how many users are on each version? We're still using Flurry right now but looking for a replacement.
PostHog released plugins recently (posthog.com/plugins) - these let you trigger webhooks in other systems based on realtime events that have taken place (as well as exporting/importing data/transformations etc).
You just write a few lines of TypeScript in the platform (avg LOC is something like 80) - see https://posthog.com/docs/plugins/build. There are a bunch prebuilt too.
As an employer, I find LinkedIn profiles faster (and thus nicer) to screen (we're a company that doesn't ask for a set application format) - since you don't have to adjust your brain to the format! I'm less likely to miss stuff, but might skim faster versus reading your story.
That said, if someone just sends me (I'm cofounder, post series B startup) an email directly which is well thought out connecting your skills with what we're working on, I will 100% read it / consider it. This ticks a box that you're interested in what we're working on - which we need to feel to hire you.
I do not now look at the vast majority of submissions, since the vast majority of those are generic, so we have a full time recruiter looking through.
You are correct - haven’t actually done this yet since we’ve had no chance to so don’t take too much from this policy until we’ve done it a few times!
We set up hedgehog.vc which is what we’d use to fund ex employees if you’re curious.