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💰 The Business of Open Source
How Open-Source Projects Make Money and Sustain Themselves

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Today, we’re learning about open-source software. Let’s dive in!
TODAY’S LESSON
RETHINKING OWNERSHIP
The Business of Open Source

Open-source software powers everything from the apps on your phone to the servers running the internet. But if the code is free, how do open-source projects make money? The answer lies in creative business models that turn freely available software into sustainable ventures.
Many successful open-source projects rely on sponsorships and donations. Platforms like GitHub Sponsors and OpenCollective allow individuals and companies to fund developers directly. In return, sponsors often get perks like early access, priority support, or recognition within the community.
Another common strategy is the freemium model, where the core software remains free, but premium features, support, or cloud hosting come at a cost. Companies like Red Hat have built billion-dollar businesses by offering enterprise-grade support and services around free software.
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Some projects go the dual-licensing route, offering their software under both an open-source and a commercial license. This lets businesses use the free version but requires them to pay for additional rights, such as embedding the software in proprietary products.
For large-scale projects, corporate backing plays a major role. Tech giants like Google, Microsoft, and Amazon contribute to open-source projects they rely on, ensuring long-term development while aligning the software with their own business needs.
Then there’s the consulting and training approach. Developers of popular open-source tools often monetize their expertise by offering custom development, implementation services, or training programs for companies adopting the software.
Open-source isn't just about free code—it’s a dynamic ecosystem where passion meets sustainability. By leveraging smart business models, developers can keep their projects alive while ensuring the world benefits from open innovation.
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