Lessons learned from a successful open source consulting company. This talk is geared towards the open source developer who is considering starting his/her own business, and the entrepreneur who wants to grow the business by leveraging open source development methodologies.

1. Building an open source
consulting company
Nate Aune
www.jazkarta.com
Open Source Bridge Conference
Portland, OR
June 17, 2009
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2. /me
• First experience with Linux in 1994
• Founded Jazkarta in 2004 in Boston
• Now 3 full-time staff and 10 subcontractors
• Specialize in Plone and Python
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3. Topics for exploration
• Marketing • Recruiting
• Pricing • Finances
• Contracts • Open Source citizen
• Project Management • your topics?
• Services
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4. Marketing
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5. Marketing & getting work
• Speaking
• Blogging
• Sponsoring
• User group / consultants group
• Networking
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6. Pricing
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7. Pricing / rates
• How much do you want to make?
• What are your costs?
• What will the market bear?
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8. $100,000 / yr
$100,000/yr % 50 wks/yr % 20 hrs/wk
=
$100/hr
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9. Costs of doing business
(overhead)
• Self-employment tax
• Legal fees
• Accounting / bookkeeping
• Office space
• Hardware
• Subcontractors
• Telephone
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10. Market rates
• What are your competitors charging?
• How much will your customers pay?
• How does the economy affect your bill rate?
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11. When to raise rates?
• When your customers don't blink an eye
when you tell them your rate
• When you have more work than you can
handle
• When you have an in-demand skill
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12. Contracts
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13. Contracts
• Get legal advice - don't do it by yourself
• Optional scope contracts
• Tools: EchoSign for digital signatures
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14. Traditional vs. Timeboxed
Optional scope contracts:
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15. Project management
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16. Project management
• Agile is aligned with open source development
• 2 week iterations
• 3 person teams (PM, dev, design)
• Tools: ClueMapper, Google Docs, Dropbox
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17. Resource planning
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18. Global Team
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19. Global team strategies
• Group team members in same or close timezones
• Make sure everyone is on IRC and uses it
• Set up a mailing list for each new project
• Skype calls every week to touch base
• Issue tracker (ClueMapper/Trac)
• Version control (Subversion/Bazaar)
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20. Pros/cons of
subcontractors
• Pros
• Only pay them when you have work
• Can find top talent, specialists
• Cons
• More expensive
• Can be difficult to retain if not enough work
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21. Services
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22. Services
• Development
• Training
• Support Recurring revenue
• Hosting
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23. Training
• Private onsite training
• Public training
• Training as part of a conference
• Online training
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24. Support
• Open source = no guarantees
• Retainer = insurance policy
• Keeps the conversation going
• Upsell support before the project is complete
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25. Hosting
• Easier to support if on servers you control
• Distribute benefits across all customers
• Upselling opportunities
• Steady source of recurring revenue
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26. Recruiting
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27. Recruiting
• Read blogs
• Attend sprints
• Elastic staff
• User groups
• Internships
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28. Finances
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29. Finances
• Get a good bookkeeper
• Seek next project while still on first project
• Find sponsors to fund open source dev
• Tools: Quickbooks
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30. Open source citizen
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31. Open source citizen
• writing documentation
• contributing code
• serving on board
• sponsoring sprints
• organizing user group
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32. Thanks! Questions?
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33. Stay in touch
• Email: natea (at) jazkarta (dot) com
• Twitter: twitter.com/natea
• Blog: blog.jazkarta.com
• IRC: irc.freenode.net/natea
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34. Books & Resources
• e-Myth Revisited by Michael Gerber
• Manage It! by Johanna Rothman
• Ship It! by Richardson/Gwaltney
• Art of Agile Development by Shore & Walden
• Making Things Happen by Scott Berkun
• Computer Consultant's Guide by Janet Ruhl
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