We, product marketers, are wired to drive product adoption and pipeline through understanding the needs of our prospects. We excel in product-led organizations because we have full visibility into the customer journey, from trial sign-up to renewal. With access to this data, we can test ideas, suggest new features, and create activations that increase adoption and boost revenue.
But what happens when a company offers free, open-source software (FOSS)? In this case, PMMs have limited to zero visibility into the product adoption, usage, and no connection between the download of the software and its impact on revenue.
So, how do you go to market with such a product? How would you grow revenue from the product you can not track the usage of? Why would any PMM want to work with a product for which they can not see the revenue? And how organizations that chose open source software as their marketing strategy, can thrive? Let’s talk about these, and some other thought-provoking questions, in this article.
What is open source software and why do organizations choose to start an open source business?
Open source software is software that’s developed through open collaboration and is available for anyone to use, modify, and redistribute. For many organizations, choosing to start an open source business isn’t just about giving software away for free – it’s about building trust, encouraging rapid innovation, and avoiding the pitfalls of traditional proprietary models. By developing openly, these organizations gain the backing of a global community and foster transparency. Companies start open source businesses to tap into these benefits while also positioning themselves as thought leaders and experts in their field. But if open source software is free and accessible by anyone, why can’t organizations just download and use it for free without paying you for additional services and features? In other words, if code isn’t a competitive advantage, what is?
Independent open source companies have three big competitive advantages:
- Enterprise customers aim to avoid vendor lock-in, a situation where they become overly dependent on a single vendor for key operations. For instance, relying on a large cloud provider not only for infrastructure but also for database services can lead to substantial costs and challenges if the organization ever needs to migrate its data elsewhere.
- Enterprises also prefer to work with companies that are directly involved in the development of the software or have made significant contributions to its innovation. Consider PostgreSQL, one of the fastest-growing open source databases, which is highly regarded by developers and largely driven by a passionate community. Many of those contributors are employed by companies like EnterpriseDB. While EnterpriseDB doesn’t develop its own open source software, it has built a team of PostgreSQL experts who contribute significantly to the community version. This expertise fosters trust among enterprises, which fuels their business growth.
- Companies typically lack the in-depth knowledge that an independent open source software vendor possesses. These vendors, with their deep understanding of the code and the broader ecosystem, are well-positioned to continuously improve the product and offer the best solutions.
But for companies that chose going the FOSS route, open source in itself is not a business model. Millions of downloads of your open source project don’t pay the bills, and while they can, in some cases, be converted into paying customers, doing so profitably requires a thought-through open source business model.
There are three main open source business models:
- Support and services. This is often called the Red Hat Model, after the most famous practitioner. Examples of companies with such business model is Percona, RedHat, Canonical, CloudLinux, EnterpriseDB.
- Enterprise distributions (or Open Core), in which the company sells proprietary software that has some additional functionality and customers run the software themselves. Companies like MongoDB, Oracle, RedHat, etc., operate in this business model as well as the support and services one.
- Software-as-a-Service (SaaS). The underlying software can be open source, but the hosting and resources is what the user is paying for. For example, Grafana, Aiven, MongoDB, Amazon Web Services, Google Cloud and many other cloud providers operate in this business model.
As you can see from the examples, an organization can choose one or all of these business models for their open source business. The company I work for, Percona, started as a service shop for MySQL in 2006, and grew into a multi-database software and services company over the years. Being a services-first business presents challenges, the main one is that it is hard to scale. To alleviate this, we found a balance between services- and software-led models:
- Services: Database support, managed services, consulting, training.
- Software: the portfolio includes open source software, enterprise distributions with additional features available only to customers with the services contract, and SaaS offerings currently in active development.
While open source software and its adoption create opportunities, companies must choose a sustainable path whether through services, enterprise distributions, or SaaS, or a mix of all three business models – to generate revenue. Building expertise around the open source code and creating trust with community and enterprise customers are key factors that drive the success of open source companies. Next, let’s explore the challenges of going to market with open source software.
Challenges Of Going To Market With Open Source Software
The foundation of a successful open source business is built on three crucial elements, and the challenges of going to market with open source software stem from them. For an open source business to succeed in the long run, all three components must be balanced and supported by clear, measurable goals.
Establishing a thriving community
Fostering a dedicated community of developers who actively engage with and contribute to the open source project is key to the project success. Community growth can be tracked through metrics such as the number of stars, commits, pull requests on GitHub, and growth in the contributor base.
Challenge of building and maintaining a thriving community: One of the first and most complex challenges is nurturing a community of developers who are willing to contribute to your project. Open source communities are driven by passion, but that enthusiasm can be difficult to harness consistently. Contributors may come and go, making it hard to ensure ongoing development and support. Additionally, managing a diverse group of contributors from around the world requires careful moderation, conflict resolution, and establishing clear guidelines for collaboration. Without strong leadership and an active engagement strategy, the project risks stagnating or fracturing into competing efforts.
Achieving product adoption
Once the community is in place, the organization needs to achieve widespread use of the open source software. Success at this stage can be measured by the number of downloads and the extent to which the product is being utilized by its users.
Challenge of scaling product adoption: Even with a vibrant community, the next hurdle is ensuring broad adoption of the software. While open source software can attract early adopters and developers, transitioning from niche usage to mainstream adoption requires more than just a good product. There are challenges related to market awareness, competition from proprietary solutions, and the need to convince enterprises of the software’s reliability and security. Widespread adoption often demands proper documentation, user-friendly interfaces, and support for enterprise-grade features – all of which can be resource-intensive to develop without immediate financial returns.
Finding a profitable value proposition
The final element is identifying a way to offer something valuable that customers are willing to pay for, ensuring the company can generate revenue. The effectiveness of this element is reflected in the company’s financial performance.
Challenge of monetizing an open source product: The biggest challenge for open source companies is turning usage into revenue. Many users of open source software expect it to be free, and finding a profitable value proposition that people are willing to pay for can be difficult. Companies must navigate the delicate balance between keeping the core software free and open, while also offering premium services or features that justify a paid tier. Monetization models such as support, enterprise versions, or SaaS require strategic investment and a deep understanding of customer needs. Scaling this part of the business while remaining true to the open source ethos is an ongoing challenge.
Another challenge in monetizing an open source product is the lack of visibility into the path from product adoption to revenue. Open source companies rarely gate access to their software, meaning anyone can download the code or distribution and use it without registering. In my experience, however, this is not an insurmountable challenge. While telemetry can provide some insight into the technical profile of users, I have tested using in-product messages that encourage users to identify themselves in exchange for swag or exclusive deals.
Surprisingly, people still enjoy receiving swag and are willing to share their details for something like a t-shirt. This small investment offers visibility into the user base and helps generate leads.
Challenge of managing reputational risks from licensing changes: A significant challenge for open source businesses is handling the delicate issue of licensing. While the open source community highly values transparency and openness, there may come a time when a company feels the need to alter its licensing model to protect its business interests or increase revenue. For instance, transitioning from a permissive license to a more restrictive one can help prevent competitors from exploiting the software for profit, but it also risks alienating the community that contributed to the project’s success. Such changes can lead to backlash, a loss of trust, and even forks of the project, where community members create alternative versions under the original license. Striking a balance between business needs and community expectations is a sensitive task, and any misstep could result in long-lasting reputational damage.
Interestingly, there has been a growing trend of organizations relicensing their projects from open source to proprietary licenses after initially gaining traction as open source projects. amples include Redis, MongoDB, Elastic, and HashiCorp. While companies adopt this strategy with the goal of stifling competition and improving their financial performance, industry analysts have not observed clear evidence that changing a license has a significant positive impact on financial outcomes.
Go-to-Market Strategy for Open Source Products: How It’s Different From Commercial Products
Organizations that decide to go the open source route usually consider open source software as a top-of-the-funnel activity, followed by product differentiation in the consideration stage, and lead generation and sales in decision and loyalty stages. So the main difference between GTM strategy for commercial versus open source products is that community management is crucial for FOSS projects.
Community Management fuels the top of the funnel by building awareness about the FOSS products an organization is producing, focusing on openness, collaboration, and what makes the product unique from other open source and proprietary products. At this stage, the role of Product Marketing is to help find the differentiation for the open source product.
On the Consideration stage of the funnel, it is the role of the Product Management that is vital. Product Management team makes sure the product is stable, that new features are introduced to cover more use cases of the users, eventually making them evangelists of your open source product. Product Marketing’s role on this stage is to communicate with the users to understand their use cases, and incorporate user’s insights into the communication strategy on the next stage.
On the Lead Generation stage, Product Marketing works closely with Content, Growth Marketing, and pre-sales Organization to build awareness about the paid component of the organization’s business model. At Percona, we build campaigns together with the rest of the Marketing and Sales team and our deliverables include positioning, messaging, technical content – everything you do for a commercial product, but this time you connect open source software with the chosen business model/s. We also act as project managers that drive GTM strategy for the products. Below, you will find an example of the GTM strategy for an open source product that was launched by my team in 2024.
On the Purchase stage, Product Marketing works closely with Sales to ensure the sales team has everything they need to confidently engage and close deals. Just like we create personas for external communication, internal teams also have different personas to consider.
Sales teams are structured differently depending on the company’s size and sales model. In some organizations, one person may handle the entire sales process, while in others, specialized teams guide customers through each stage. Whether your sales reps focus on one part of the process or take on multiple roles, their needs will vary:
- Business Development Representatives (BDRs), Sales development reps (SDRs), and Inside Sales Representative (ISR) are talking to prospects at an early stage, so they need awareness content with fewer technical details.
- Sales Reps need things like sharp pitch decks, product datasheets, battle cards, and proposal templates for their daily work. If one sales rep is handling the whole buyer journey, their needs will change depending on where they are in the process.
- Sales Engineers need more in-depth, technical materials like solution briefs and product presentations to highlight the technical side of your product.
- The Customer Success team needs customer-facing materials like a roadmap to guide their interactions.
You can learn more about different needs of Sales personas and what initiatives you can include into the GTM plan for open source launch to cater to the needs of every sales department in my guide.
A Note About the Audience of Open Source Products
The audience that an open source business should communicate with at each stage of the funnel can vary depending on the business model(s) the organization has chosen.
For SaaS and Open Core models, the initial open source users may be the ones who later purchase your Enterprise or SaaS versions. For Services, the marketing team typically targets the technical leadership of the organization to build awareness about the offerings.
If your organization combines different business models to monetize open source products, you, as a PMM, along with the Community and Product Management teams, need to develop distinct communication strategies for users, influencers, decision-makers, and buyers.
Example Of The Go-To-Market Strategy For An Open Source Product
In September 2024, my team did a tremendous job launching our new open source product, Percona Everest. It is an open source software for companies looking to automate their database operations at a lower cost than with hyperscalers (like Google Cloud or Amazon Web Services). One of the most common use cases for Percona Everest is to help organizations build their own, internal Database-as-a-Service (DBaaS).
We used a mix of tactics to introduce new products to market – email, PR, thought leadership, customer campaigns, webinars featuring early adopters, and internal enablement – it all helped double product adoption compared to beta launch, triple the website visits and generated several millions for our pipeline.
Our GTM strategy included:
- Email campaign,
- Public Relations campaign (press outreach and thought leadership content),
- Event marketing (on-site and online),
- Community campaign,
- Digital marketing campaign (display ads, PPC, newsletter ads),
- Demand generation (relevant asset promotion on tech websites and newsletters),
- Video marketing (demos, promo videos),
- Content production (eBooks and whitepapers, testimonials, datasheets, solution briefs),
- Internal enablement (Sales, Customer Success, Technical and Marketing teams).
The tactics featured in our strategy weren’t particularly unique. The success of the launch was made possible through close collaboration between product marketing, product management, sales, the community, and the rest of the marketing team, along with a strong commitment to discipline and the go-to-market process we follow. If you would like to learn more about the process for product Go-To-Market, reach out to me or my team (Val Bogatyreva or Kate Obiidykhata) on LinkedIn.
Conclusion
Going to market with an open source product requires a strong focus on community building, differentiation, and aligning the product with the business model. By fostering a dedicated community, organizations that chose open source route can fuel the top of the funnel, generating awareness and engagement. The role of product marketing is to guide users from free engagement to paid offerings by crafting compelling messaging that connects the open source product to the business’s paid offerings.
About Guest
This article is written by Aleksandra “Sasha” Mitroshkina, currently a Director of Solutions Marketing at Percona. Aleksandra has been working on bringing both proprietary and open source products to market since 2018, connecting the dots between FOSS product adoption with organization’s revenue, and finding the ways to grow the pipeline of the organizations, including those organizations that chose open source path towards success. Aleksandra is also an author of the course on “Sales Confidence: Ways to Measure and Improve It” and specializes in strategic product marketing, sales enablement, and bringing order to chaos with innovative processes.
