My role then was to lead revenue growth and build an organization to sell free software to the world. Figuring out how to do that would be the biggest challenge of my career. I needed to determined how to make money at a company made up largely of technically brilliant developers…who didn’t believe in making money. (Tricky, to say the least.)
Understanding and embracing the open community of developers who contributed to the code—many of whom were anti-establishment, who thought marketing was taboo, and regarded Microsoft as the Evil Empire—was critical to the success of the company. These outside developers from all over the world were our early adapters, downloading Red Hat Linux for free, and they made an effective product.
I feed off these expanded thought networks because they let diverse groups of people with common interests from all over the world bounce ideas around and create together—or walk away to create on their own, inspired by the cloud of contributions.
My experience with Linux and Red Hat illuminated four points about the advantages of being open for anything, embracing any idea that might help a company or project you’re creating.
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1. You have both the developers and the promoters on hand already. In Eric Whiteacre’s Virtual Choir, more than 2,000 people joined to sing original music via Skype—the contributions, edited by volunteers, became one of the most inspiring collaborations of original music I’ve ever experienced.
Today we call this “crowdsourcing”: when an idea blossoms beyond any one person’s wildest imagination and continues to blossom when more minds come together. When a passionate group comes together for a common initiative, the members collaborate because they want to use the product or service themselves, or to experience the outcome. There’s a real connection around this common interest and passion.
In these cases, the vision is clear from the outset—crystal clear, and big enough to absorb other people’s influence to become more than anyone expected.
2. You have a group providing meaningful instant feedback. You have the potential of an entire ecosystem of support, and the complementary services and products of others in your open circle, which anyone can monetize. As you become more successful, they become more successful, and vice versa. Sometimes this feedback is brutally honest—but when that happens, there’s no wondering where you stand.
Word Press, Google’s Android, Apple’s iPhone and iPad all created collaborative forums for open contributions. Apple and Google also have proprietary parts to their business—the hybrid models are working well—but in each case, the efforts can span new opportunities and new business for everyone involved.
3. Troubleshooting issues becomes more immediate. That means you can correct problems in minutes, not hours or days. And there’s a 24-hour network of collaborators who are always ready to help.
4. Fresh ideas are always available. If you have a large, diverse, open circle around your efforts, you’ll never get stale or flatten out at the status quo. Your passionate group, with its common interests and infectious interest, is always growing, and nudging members to new heights. We learn together by default.
There are so many benefits to creating open innovation circles that help entrepreneurs and help establish business scale. As someone focused on revenue, I understand that the monthly and quarterly numbers are critical to the life of young companies. Cash flow is king, and building sustaining revenues usually takes twice as long as you think it will.
So many companies start out with just one or two products to sell in their early years—but when they learn and serve their core markets, they often look very different in Years 5 and 6 than they do in Years 1 through 4.
In the early days of Red Hat, revenues from the actual Red Hat baseball caps, fedoras, T-shirts and training materials were larger than the actual sales of software products. The Linux community was rightly proud to be a part of something great.
But it wasn’t one single person, or even 10 people, who made Red Hat a success—it was a global network of employees, non-employees, and Linux-focused software companies that converged to build a superior operating system and to bring down the Evil Empire.
They did the former, but as you know, the latter is still standing strong today. Everyone wins.
OPEN Cardmember Teresa Spangler is the founder and general partner of PlazaBridge Group, a boutique consulting firm focused on helping companies grow. She also serves on the boards of the NC World Trade Association and the Council for Entrepreneurial Development, and holds advisory-board roles with numerous growth companies.