Investing In Open-Source Projects: Here’s What VCs Are Looking For (crunchbase news)

By Shomik Ghosh

Red Hat’s IPO was more than 20 years ago, and open-source is hardly a novel new approach to software. But the recent astronomical success of public companies like MongoDB and Elastic has created an investor feeding frenzy for would-be startups with open-source origins.

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If you’ve been steadily growing your project and wondering if you’ve got what it takes to attract venture funding, let’s take a look at some of the key criteria for getting VCs excited.

Solving a frequent problem for millions of developers

One of the most attractive characteristics of open-source from an investment perspective is pretty obvious: The enormous total addressable market of tens of millions of developers on the planet. As investors, we get really excited when we see open-source projects that scratch an itch faced by the majority of this massive market.

CloudQuery, a boldstart ventures-backed company, is a great example.

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