Business model
What we call business models in this context are transitionary models, hybrid models that can interface with the traditional economy. In times of transition, these hybrid models assure the subsistence of OVNs, i.e. help generate fiat currency that is used to acquire goods and services that are available on the market, purchase equipment, rent a physical space or deploy digital infrastructure, among other things. Thus some ventures operate in pure p2p mode, others operate in hybrid modes. For a more general overview of the p2p economy see: economic model and peer production.
ToDo: harmonize this with entrepreneurship stack
Example of business models
Software specific
- Marketplace / Plugin ecosystems (ex. WordPress ecosystem, Drupal),
- Open Core / Dual Licensing (ex. GitLab, MySQL AB, Qt Company),
- Open Core
- Mechanism: Core software = open source ; Advanced features = proprietary
- Properties: Scales well, Aligns with SaaS economics
- Dual Licensing
- Mechanism: Same codebase, open license (e.g. GPL), but commercial license for proprietary users
- Properties: Extracts revenue from firms that want to avoid copyleft constraints
- Open Core
- SaaS / Hosting (ex. Automattic, MongoDB Inc.),
- Mechanism: Software is free, running it reliably is hard → sell convenience
- Properties: High scalability, Strong revenue capture. Shifts power to infrastructure operators. Converts operational burden → rent
Hardware-specific
- Sell Physical Products (ex. Arduino Prusa Research),
- Mechanism: Designs are open. Revenue from manufacturing & distribution.
- Properties: Commons = design layer ; Market = physical instantiation
- Kits, Components, and Supply Chains
- Mechanism: Sell convenience bundles (DIY kits), pre-assembled kits, certified / hard to find / custom parts (ex. BackYard Brains or OpenQCM both sell the most specialized and hardest to source components for their respective open hardware tools), logistics
- Insight: Monetizes friction in production, not IP
- Help with calibrating and validating (scientific) hardware (can be transactional service) to provide security to prosumers who build their own tools. This provides prosumers with the confidence that their measurements or functionality are acceptably reproducible, accurate and precise.
Hardware and software
- Service-Based Models (Labor monetization around a commons)
- Support, Consulting, Integration (ex. Red Hat, Canonical),consultancy services, tech support offered to traditional organizations, firms, academic labs and even government, related to open innovation and open science. See OuiShare Paris, back in the early 2010's and Sensorica for examples.
- Mechanism: Code is free.
- Revenue comes from: deployment, customization, maintenance, troubleshooting
- Training & Certification - ex. Linux Foundation certifications, Kubernetes training ecosystems, Open Source Ecology - Fjelsted et al., 2012.
- Mechanism: Certification creates signaling value
- Revenue comes from: Monetize skill acquisition
- Converts knowledge commons → credential scarcity
- Support, Consulting, Integration (ex. Red Hat, Canonical),consultancy services, tech support offered to traditional organizations, firms, academic labs and even government, related to open innovation and open science. See OuiShare Paris, back in the early 2010's and Sensorica for examples.
- Platform & Ecosystem Models
- Marketplace / Plugin Ecosystems (ex. WordPress ecosystem, Drupal)
- Mechanism: Core is open
- Revenue via: extensions, marketplaces, transaction fees
- Standards + Network Effects
- Mechanism: Control over protocol, ecosystem direction
- Revenue: Monetize complementary services
- Insight: Power shifts from code → coordination layer
- Marketplace / Plugin Ecosystems (ex. WordPress ecosystem, Drupal)
- Ecosystem services: provide trust, validation, discoverability, help, a place to discuss and collaborate, etc.
- Cooperative / Commons-Centric Models, including Platform Cooperatives (ex. Sensorica)
- Contribution Accounting + Revenue Sharing
- Mechanism: Track contributions, Redistribute income proportionally
- Properties: Attempts alignment between production and distribution
- Challenges: Revenue instability, governance complexity
- Platform Cooperatives
- Mechanism: Shared ownership of infrastructure, Revenue distributed among members
- Properties: Closer to commons logic, Hard to scale
- Patronage & Collective Funding
- Donations / Sponsorship (ex. GitHub, Sponsors, Open Collective, Mozilla Foundation),
- Mechanism: Voluntary contributions from users or firms
- Properties: Aligns with commons logic. Weak predictability
- Grants & Institutional Funding
- Mechanism: Foundations, governments, NGOs fund development
- Properties: Enables public-good infrastructure. Dependency on external agendas
- Contribution Accounting + Revenue Sharing
- Token / Crypto-Based Models (NDO, DAOs, Web3 projects),
- Mechanism: Contributors rewarded with tokens. Tokens gain value via ecosystem growth
- Assessment: High volatility, Weak long-term sustainability evidence
- Interface with the crowd (pioneered by Sensorica), helping traditional organizations to crowdsource R&D.
Hybrid Models (Most real systems)
In practice, successful actors combine:
- SaaS + open core
- consulting + certification
- hardware sales + community
- grants + services
Pure models are rare; hybridization is the norm.
See also open business models patterns.
Compatibility with open source and free licenses and culture
This is important because open innovation (inspireinspired from open source) is the innovation model of peer priduction.
| Business Model | Open Source Compatibility | Free (Libre) Compatibility | Notes |
|---|---|---|---|
| Services (consulting, support, integration) | 5 | 5 | No restriction on code; revenue from expertise. Strong alignment. |
| Training & Certification | 5 | 4 | Compatible, but introduces scarcity via credentials. |
| Hardware sales (open hardware) | 5 | 5 | Monetizes physical layer; knowledge remains open. |
| Patronage (donations, grants) | 5 | 5 | Ideal commons alignment; no enclosure. |
| Contribution accounting (OVN models) | 5 | 5 | Aligns production and redistribution without restricting access. Example: Sensorica |
| SaaS / Hosting | 5 | 3 | Legally compliant, but concentrates control in infrastructure; weak reciprocity unless copyleft like AGPL is used. |
| Marketplace / Plugin ecosystems | 5 | 3 | Open core ecosystems can drift toward dependency and partial enclosure. |
| Open Core | 5 | 2 | Open subset exists, but deliberate feature withholding undermines commons integrity. |
| Dual Licensing (e.g. GPL + commercial) | 5 | 3 | Legally valid; uses copyleft (e.g. GNU General Public License) strategically; culturally ambiguous. |
| Token / Crypto incentive systems | 4 | 2 | Code often open, but incentives skew toward speculation over cooperation. |
| Platform capture (centralized control over open stack) | 4 | 1 | License respected, but power asymmetry undermines freedom in practice. |
| Proprietary forks violating copyleft | 0 | 0 | Direct license violation. |
| Relicensing to “source-available” (enclosure) | 1 | 0 | Breaks free software principles; restricts user freedoms. |
Where Tension Appears: The drop in “free compatibility” happens when monetization relies on:
- Control of infrastructure → SaaS
- Control of features → open core
- Control of ecosystem → platforms
- Financial speculation → token systems
These do not violate licenses, but they shift power away from users.
Structural Insight - Open source guarantees permission to act. Free software aims to guarantee capacity to act without domination. Most business models satisfy the first. Only some preserve the second.
A model scores high on both axes if:
- It does not introduce artificial scarcity in the shared resource
- It does not shift control to opaque layers (cloud, platform, governance)
- It maintains reciprocity between users and producers
From Sensorica's experience
Sensorica was launched as an OVN focused on designing open source scientific instruments. In the early days, it focused mainly on product development. The intent was to design, sell and service open source scientific instruments, but the reality was other. The first revenues that were generated within the network were in the form of R&D grants in collaboration with academic institutions. Four years after its inception, Sensoricans were called to accompany traditional firms in their first explorations of new and disruptive technologies, such as IoT and Blockchain, exploring potential benefits, prototyping applications (proof of concept) that may fit with the business model, exploring new business models. Sensorica's edge was speed of innovation and more than 50% cost reduction. Sensoricans coined the phrase crowdsourced R&D on demand. In parallel, Sensoricans were also commissioned a few projects by academic labs, with the added value of increased dissemination and adoption of open source hardware, naturally achieved through the social mode of development of the network.
Sensoricans understood that they can position the OVN in innovation, which is "the new gold" in high tech markets. Thus, Sensorica was "sold" as an 'interface with the crowd through which traditional organizations can engage in open source development, accelerate innovation and cut development costs.
Interfaces between open and traditional organizations the Sensorica experience
Towards 2021, with the Greens for Good venture], Sensoricans started to think about non-market-based economic models, or second and even third order models. In 2024, with the PEP Master venture opened a new frontier with the proposition of the trust-based economy.