Kaeru's Online Journal
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ASEAN FOSS Business Partnerships?
Partnerships are common in most fields for large projects, when you need to divide up specialization or need to combine capacity.
I use the term partnerships here, because everyone is working together in an open and transparent manner.
There are a few barriers when it comes to partnerships in Malaysia between FOSS business:
- Different competing technologies
- Hugely different capacity and culture
- Not FOSS (developed code not made available under FOSS license)
- Sub-contract and lack of transparency
- Competitors in same market
- Different competing technologies
- You can't combine capacities, when one company does RoR, another on Zope and another on PHP.
- Different capacity and culture
- There is a huge difference in technical capacity of engineers with FOSS culture (upstream development and participation, transparency) and those that work in a closed manner. If the gap is too big, and it often is, there is no benefit for company with higher capacity as knowledge transfers are one way. There are no productivity gains, as the specializing company just cannot do the job they're supposed to do.
- Not FOSS
- Advantages of code and module sharing, reuse does not work. No incentive to jointly improve on code in future.
- Sub-contract and lack of transparency
- Not a barrier. This is not a partnership. Lots of hidden problems also with lack of transparency.
- Competing in same market
- If there is potential to cannibalize partners' income, then you become competitors.
So finding a partner in Malaysia is probably not going to happen for Inigo. Finding a partner in EU/US is harder because, we probably are the lacking partner in terms of skills capacity. There is also the issue of time and travel. I see a lot of EU FOSS partnerships, because it's easy for them to easily meet and collaborate.
With low-cost air travel, similar time-zones, non-competition (for domestic markets) and similar capacities, can FOSS project partnerships work between ASEAN companies, when no suitable domestic partner is available?
I think it can.
It also may be the solution to some risk issues we have with growth for larger projects, for a self-funded employee owned company.
The risk that we're facing is that we need to do larger projects that are proportionally much larger than what 1-2 people can do. Finding 20 fresh graduates won't work for our model. We need 3 more that have similar capacity, skill sets and development/engineering culture. Try find 3 good FOSS people available locally, you know, the usual suspects. Then try to find if they're interested in working with the same technology. Then factor in their salaries/fees.
A partnership would allow us to avoid chicken and egg problem of large projects and building human capacity.
We're going to give a few tries at this and share the learning experiences. If it works, then we should be seeing more EU and US style FOSS SME development and collaboration happening in our region. GTUGKL has already shown what's possible. Now to extend it to other FOSS technologies.
A few Inigo links
So there's an official blog now at Inigo for sharing information with others interested in experiences of bootstrapping and running a FOSS small business in Malaysia.
- Booting up on where we've been since FOSS.my and some of our upstream and community contributions.
- GnuCash: Salary, EPF and SOCSO - on setting up GNUCash accounts for Malaysian type payroll with EPF and SOCSO contributions.
Starting a FOSS Development/Support Company
I've wanted to give it a try for some time. I've been one of those advocating and developing various programmes for training etc. for tech people interested in FOSS to start their own business and providing FOSS service and support. As is often the case, talk is cheap. Doing it is a lot harder. Setting up a centre, running training programmes all on government or donor agency money is a hell of a lot easier, than facing the day to day business and technical realities on the ground.
Remember that Colonel in Aliens 2?
"How many jumps have you had? 2.. simulated"
"Guys, I want you to run <some drill plan>.. and move back with.."
"They're dying out there! Do something goddammit!"
So here's me getting my ass kicked by some bad ass aliens, or reality so to speak and sharing some lessons for first few months.
I had a few simple aims:
- A company that's fair for all, fair working hours, holidays, providing life balance. (See http://askmonty.org/wiki/index.php/The_hacking_business_model)
- A company that is part of FOSS and local community. Release things as open source (http://svn.plone.org/svn/collective/collective.feedviewer/), patches upstream, involved in mailing lists and irc.
- A profitable company, so that we have time to work on cool stuff, and be able to help out our communities more. eg. fund sprints, events, development etc. that contribute back to more profits. And reward the initial team for all the hard work put in.
Some important lessons so far and they are all connected:
Founders/Partners
The founders/partners all have to be believe in what they're doing, including sticking together through the hard times. The hard times are the mistakes that you're going to make. It's inevitable. Learning and recovering from them takes dedication.
If you're thinking of doing the same, make sure the founders all want to make it happen. All should be financially sound (or can live off ramen), if you have family to support make sure you have a few months of savings to tide things over during early stages. The first several months or make or break, and with a small team, one person having difficulties can take the company down or take it back to square one.
Having all want to make it happen is also important. If your partners are any good, the pressure to be a highly paid employee elsewhere without the hassles of running your own business is tempting when the going gets tough.
Building up the team
Initially we thought picking up interns and training them to be hired would be a good idea. We still think it's a good idea, but we're still looking for UI/Designers and Software Engineers. A few applications for system administrators, but our servers are relatively automated.
So it's looking like we have to go to the job market and find us some diamonds in the rough.
In the short term though, you can also rely on trusted freelancers on short term projects.
Choice of projects/clients and cash flow
It's tempting to take small projects at the start, that seem to be profitable when getting things going. They actually can drag on and what you end up is having 2-3 unfinished/unpaid small projects which are unprofitable.
Instead, what I've learnt is that take just one software project at the start and learn and build from that. Then take on progressively larger ones with experience.
At the same time, look at for alternate cash flow. Providing services such as training and other short term consultation services is a good idea. Allocating about a week of training services per month provides cash for day to day running of the company, while projects are ongoing. It can also fund for development of new applications or components, which you will need for larger projects.
Evaluating products/services
Your good idea, is probably still a good idea. but it probably needs tweaking. Plone is great for intranets and public facing sites of governments and large organizations. Not so for smaller community oriented sites, even if users like the look of it's features.
Spin-offs.
Quite a lot of skills learned and infrastructure can be reused for other software projects. Re-evaluate this, for possible new product/service revenue streams.
In summary, for those that want do something like Inigo. it's really really hard. When you plan your long term outlook, with your most conservative time estimates, double it. It'll take longer, and take more work then you envision.
It looks like it'll take us another 8 months, before we're in a more comfortable stage, but we're on the right track. For me it's been exhausting and stressful experience, but real experience nonetheless. If we make it, then we can prove that you can build a successful FOSS company that's fun to work at, with no initial external funding or support.
