The Problem
Two years in, our open-source observability collector had 30,000 GitHub stars, an active Discord with 2,400 members, and an annual conference talk that sold out every year.
We had four paying customers. Combined ARR was $112,000.
The community loved us. The community also did not pay us. We'd built our cloud product as a hosted version of the OSS — same UI, same features, "managed for you." It turned out the kind of engineers who ran our OSS were exactly the kind of engineers who could keep running the OSS themselves.
We were watching our runway shrink while every "growth" metric outside revenue went up and to the right.
The Journey
Beacon started as a side project to scratch an itch — the OpenTelemetry collector at my old job had been a bottomless source of pain, and I thought I could do it better. I open-sourced the prototype on a Saturday. By Monday it had 1,200 stars.
Within three months I'd quit my job, my cofounder Mateus had joined from another infra team, and we'd raised a $4M seed. The deck was OSS-flywheel. Get a million users on the free tier, convert 1% to paid, scale.
The flywheel half-worked. Stars compounded. Adoption climbed. But conversion-to-paid was 0.013%, not 1%. The hosted version was a worse version of the open-source version, because the OSS had grown faster than the cloud product could keep up with.
Responses
Join the conversation
You need to log in to read or write responses.
No responses yet. Be the first to share your thoughts!