Subject: Re: OpenSource: build or buy?
From: Brian Bartholomew <bb@wv.com>
Date: Mon, 21 Dec 1998 11:37:31 -0500

Hi Frank, thanks for the thoughtful and detailed reply.

> I think it's a more interesting exercise to try and find comparable
> initiatives in other areas, and see what it took for them to be
> successful.

Yes!  But perhaps the TNC isn't the best example.  I was thinking more
along the line of corporate raiding.

My plan proposed spending as much as half the revenue on profit for
the reseller.  I expect if TNC tried to do this everyone would have
been up in arms.

My plan delivers a tangible physical good to purchasers that can be
enjoyed immediately.  TNC does not.  I expect this will make my sales
easier than TNC's.

My plan has a reduced free rider effect compared to TNC's, because the
software isn't GPL'ed until the cost has been spread around for a year
or two.

> Amounts such as [$25M] are what I mean by "serious money".

I expect the purchase of an exclusive or nonexclusive right to
redistribute a product line, or all rights to a product line, or a
software company outright, to be in the $5-50M range.  It will take a
large company or VC to back it.

> especially at doing nonprofit fundraising

My plan isn't nonprofit.  If it works, it's very profitable.  That's
why VCs would be interested.

> Some organizations, including some well-known groups with fairly
> good reputations, have administrative expenses as high as 50 to 75
> per cent.

Bleah.  But your point is excellent, I need to get my cost estimates
validated by somebody who's done it before.

> http://www.nsfre.org/welcome/code.html

It strikes me as really wierd that they disavow percentage-based
compensation and finder's fees.  Isn't fundraising a sales job that is
as mercenary as anything else?  I would think donors would care what
percentage of their money goes to the purpose they're donating for,
and how the nonprofit's employees are compensated is irrelevant.

> I think that the level of effort in starting a successful project to
> do what you propose is roughly equivalent to the level of effort
> needed to form a traditional software startup, produce a plausible
> business plan and product prototype, and obtain first-round VC
> funding.

Yes, exactly.

> It's bad in the sense that just discussing this proposal on the fsb
> list and elsewhere is never going to lead to anything concrete.

I have a list of 167 high-tech VC business-plan submission email
addresses that I've extracted from VC web sites listed on yahoo.  My
first inclination was to write up my scheme as a business plan, and
spam them with it.  I don't have a strong need to participate in my
scheme, I just want to buy the resulting products.  Most of the skills
needed are in sales instead of engineering, anyway.  But I am afraid
that VCs like the appearance of exclusivity, so spamming it would
prevent all of them from considering it.  Multiple firms bidding up
the price of software products doesn't help, either.  Perhaps someone
could suggest a better tradeoff between finding a VC interested in the
plan as soon as possible, vs. preserving the feeling of exclusivity.


League for Programming Freedom (LPF) ftp://ftp.uu.net/doc/lpf/patents.text
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Brian Bartholomew - bb@wv.com - www.wv.com - Working Version, Cambridge, MA