
Dear 4bby: What to Do with My Technology - ConfusedInPalo
I could use some advice.<p>Over the years, I have developed security software that I believe is of tremendous value to both businesses and home users. I tried to make a go of it as a startup without taking on investors. That has been unsuccessful in large part due to the inexperience of the team (including myself) and lack of industry connections.<p>I have reached a point where I need to decide where to take the company and the tech. I believe the tech can do a tremendous amount of  good and feel that it addresses consumer needs that are unlikely to be adequately addressed otherwise (venture-backed companies will not see massive revenue potential in securing home users and are unlikely to address the space as a result).<p>From a personal standpoint, a pretty appealing outcome would be to continue developing the software full-time, distribute it for free to consumers, and make enough off user donations (or even a philanthropic benefactor who wants to see the technology made available) to make a reasonable salary. That allows me to continue working diligently on my passion while also potentially doing a tremendous amount of good.<p>But I do feel a strong obligation to compensate those who were part of the team even if we weren&#x27;t successful in our first attempt. And I don&#x27;t think that the above solution is as likely to result in that sort of outcome.<p>So for me it&#x27;s a dilemma. Going in the consumer direction has the potential to do good but potentially at the expense of generating the sort of revenue or exit I feel would satisfy those who joined the team. Trying to find a way to monetize it in the enterprise space could satisfy that compensation of team members but likely comes at the exclusion of offering a free consumer product long term. Both have the potential to fail even if I pursue them aggressively.<p>So I am wondering if anyone has any advice or observations I may want to consider as I try to figure out what to do. Thanks.
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razeonex
You could try some of the open source business models.

[http://www.zdnet.com/article/11-open-source-business-
models/](http://www.zdnet.com/article/11-open-source-business-models/)

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bestan
Completely agree that open sourcing the software can be very good for the
business (I'm a little biased though).

Think of OSS as an entry into the market - you get exposure, feedback and
community (if you actively invest into building it). If your software creates
value for enterprises, they will pay you anyway because they need commercial
support and some sort of warranty and reliability.

Check out [https://www.minohubs.com/](https://www.minohubs.com/) (disclaimer:
I'm a co-founder). We help open source developers to monetize and fund their
projects.

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Eridrus
I spent quite a bit of time thinking about a security startup of my own
recently and talked to a single investor about it. The wisdom seems to be that
the consumer market for security products is a pretty hard one to be in. You
can probably make some amount of money as AV & Password managers show, and
there are business models that make money on the backend through data, but the
prices people are willing to pay are pretty low and you're battling against
whatever your customer acquisition cost is.

Personally, I threw out my thoughts of doing anything in the consumer space
after writing down some basic numbers of what revenue, customer acquisition
cost, etc would have to look like for me to consider it a success. The
enterprise space seems a lot easier since I work as a security engineer and
have a lot of contacts in the field, but I can see how it would be a lot
harder without it. But if the tech is good you should be able to convince
someone with connections to come on board and help you sell.

I don't think having an enterprise offering necessarily precludes having a
consumer version (enterprises need mgmt features and are generally willing to
pay), though it will obviously not be the focus of your company and your tech
may morph over time as you align yourself closer with enterprises, but unless
you're willing to spend money up front on customer acquisition and charge the
customers more than that, you're always going to just be subsidising a free
version that most people don't really know about and your real focus will be
elsewhere.

I put an email in my profile if you want to talk about it at more length.

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ConfusedInPalo
Thanks for your reply, and sorry for the delay in mine. I would be happy to
speak with you in more detail if you'd like (I can also share my experiences
with you in case they are of value to you should you pursue a security startup
of your own). I did not find an email address in your profile however.

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Eridrus
Hmm, I can't figure out what HN wants before it will show my email; anyway,
ping me at eridrus@gmail.com if you have some time, I'd love to find out more.

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ConfusedInPalo
I have your email address now, so feel free to edit it out of the post.
Thanks.

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ConfusedInPalo
Thank you everyone for your responses.

@razeonex @bestan

I have considered the Open Source route, but I do believe it basically closes
the door on compensating contributors sufficiently. If the software gained any
traction, other security companies would simply integrate the functionality
into their own offerings with full access to the source code. Even restricting
use fro re-sale would offer little practical protection as litigating a
company for violating the terms would be prohibitively expensive. It is
something I would strongly consider if I didn't feel a sense of obligation to
others to compensate their work to this point.

@Carbide

I am a rather firm believer that, particularly in a space that is
traditionally as conservative as IT Security, software startups need to have
founders or investors who have direct influence into other organizations to
land early adopters. As you mentioned, once you have a few marquee customers
it gets easier. But our lack of experience and connections have hurt us there.
As a point of clarification, I don't have interest into selling to consumers,
only giving the software away for free to them to do some good with the
technology.

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carbide
I don't know if going the OSS route would help -- in fact I significantly
doubt it. What kind of a sales team do you have? That's more important than
your tech, a good salesman can sell junk.. a technology guy might not be able
to sell the best piece of tech out there for a penny because you just don't
know how.

Do you have someone who can do cold calls? If you're after the home consumer
do you have someone that can go door to door? It's even viable in today's age.
What have you done for local advertising? Once you start getting some
customers it's a lot easier to get more.

Remember, you can always change your business model. Do what's right for now
right now and adapt for the future to do what you really want to do.

