Finally, The Internet As Intended.

VC’s that are throwing millions at small development teams with solid design sense, a Web2.0 concept, and a dream of subscription model riches should sit up and take notice. The barriers to entry for creating web-applications that scale is now very very low. This is good for VC’s, because it lets them invest less to achieve more.  But any for fee, ’simple’ web2.0 startup is at risk of being co-oped by the open source community.

Case in point - activeCollab just launched. Its an open source clone of Basecamp, the very successful online Project Management tool from 37Signals. In many ways Jason Fried and his 37Signals crew have become the poster boys of Web2.0. Thier ‘less is more’ approach to design and development has a cult-like following. Well, what happens when your less is more approach  makes your core product reproducable by a single graduate student, and can be given away to the world for free?

One smart way to combat the low barrier to entry is to open-source yourself. Free your code to be installed anywhere, but support your on-demand service. In fact, Jason may become an even bigger rock star in the Web2.0 community if he does just that. It also may be the only way to prevent a myriad of hosted activeCollab services from sprouting up and undercutting his core business. 

So, if you’re listening, give away all your code Jason, before it gets copied and given away for you. Protect your on-demand business by letting people support their own installs for free.