October 23, 2019 by Drew DeVault

Our model is customers first, investors never

SourceHut was built by veterans of the Internet, who have watched the turbulent lifecycle of Internet-based businesses coming into popularity and fading into obscurity time and again. Most large online businesses these days are for-profit companies funded with venture capital, and that leads to a certain set of incentives. It was no surprise to us, accordingly, to receive this email from GitLab today:

We have launched important updates to our Terms of Service surrounding our use of telemetry services. Starting with GitLab 12.4, existing customers who use our proprietary products (that is, GitLab.com and the Enterprise Edition of our self-managed offerings) may notice additional Javascript snippets that will interact with GitLab and/or third-party SaaS telemetry service (such as Pendo).

For GitLab.com users: as we roll out this update you will be prompted to accept our new Terms of Service. Until the new Terms are accepted access to the web interface and API will be blocked. So, for users who have integrations with our API this will cause a brief pause in service via our API until the terms have been accepted by signing in to the web interface.

For Self-managed users: GitLab Core will continue to be free software with no changes. If you want to install your own instance of GitLab without the proprietary software being introduced as a result of this change, GitLab Community Edition (CE) remains a great option. It is licensed under the MIT license and will contain no proprietary software. Many open source software projects use GitLab CE for their SCM and CI needs. Again, there will be no changes to GitLab CE.

You can read the whole email here, or in your inbox if you have a GitLab account. The summary is that GitLab will soon:

This can naturally be frustrating to privacy-concious users of their service, and to free software enthusiasts alike. This follows closely on the news that GitLab updated official policy to state that they will do business with those who don’t share their values, which many see as a response to GitHub taking fire for accepting ICE contracts a few days prior. These kinds of changes are not implemented with the user in mind - these decisions are more easily explained by following the money. GitLab is trying to figure out how it can turn a profit that can support its $2.75B valuation. The nature of this business model leaves businesses like GitLab indebted to investors, who’ve sunk millions into the business and demand a return. An individual user’s investment is comparatively meaningless, and the incentives this creates easily leads to compromises like the ones we’re seeing in GitLab recently.

I1 have written about the up-and-down lifecycle of Internet businesses as early as 2014, when I noticed a trend among image hosting websites to make decisions which increasingly favored their business at the expense of their users. This culminated in the failure of an early business venture of mine, MediaCrush, when we chose to close the service instead of making these compromises. In the years since I’ve found that this problem generalizes across the entire industry and beyond. When designing the business model for SourceHut, I vowed that this would never be our fate.

SourceHut has never accepted any outside funding, it’s completely bootstrapped. I started the business while working a full-time job and built it in my spare time over the course of two years. Next month will mark the third anniversary of the project and the end of the first year of public alpha. Today, it’s a profitable business and we’ve just brought on our first full-time sponsored free software developer. Some people have complained that paying for their account on SourceHut is a deal breaker. But, consider that the incentives that this approach creates hold us accountable only to the users. When you let venture capitalists foot your bill, you also give them power over you. And in any case, free SourceHut accounts are available by request to anyone with extenuating circumstances2.

Thanks to this incentive model, SourceHut can easily skip anti-features:

Since we get all of our income directly from the users, we don’t have to worry about finding other ways to monetize you. To me that seems like a pretty good business model, even if it’s never going to be a “unicorn”.

UPDATE: Thanks for the feedback. There were many more concerns than we expected. We’re going to process the feedback and rethink our plan. We will not activate product usage tracking on GitLab.com or GitLab self-managed for now. We’ll make sure to communicate in advance on our blog when we do have a new plan.

via gitlab.com/www-gitlab-com!33289

  1. Hi, I’m Drew DeVault, founder of SourceHut and your friendly neighborhood sysadmin. ↩︎

  2. Technically, you don’t have to pay at all during the alpha. ↩︎

  3. The exception is your billing information, but we don’t have much of a choice about that. ↩︎