Open is the way (Interview)

Investment Principles

Joseph Jacks, founder of OSS Capital, shares his unique approach to investing in open source companies. He emphasizes the importance of capitalism in driving innovation and success, stating that investing in companies, rather than just open source projects, is key to achieving substantial returns. Jacks highlights the rarity of founders who excel in multiple areas such as selling, building, and leading teams, noting that these individuals are crucial for the success of open source ventures 1.

Build something great, charge money for it, make more than you spent. Keep doing that consistently. It's not complicated.

--- Joseph Jacks

His experience with Kubernetes and the transformative nature of open source projects has shaped his investment philosophy, leading to the creation of a solo GP fund managing hundreds of millions of dollars 2.

   

Funding Challenges

Securing funding for open source initiatives presents unique challenges, as Joseph Jacks explains. He recounts the early days of OSS Capital, where he had to clarify that the fund was not for open source projects but for companies built around them. The initial lack of clarity led to misconceptions, but a viral tweet helped him raise significant capital, marking a turning point in his fundraising journey 3.

I kind of had an intuition that was a good idea to do OSS Capital, but the validation from the tweet was like, oh, shit, I have to actually do this fund now.

--- Joseph Jacks

Despite the hurdles, Jacks successfully raised a $52 million fund, largely due to the support of key investors and favorable timing during the financial boom of 2021 4.

   

Success Stories

Joseph Jacks highlights several success stories from his investments in open source companies. He proudly mentions being the first investor in companies like Cal.com and Hopscotch, which have grown significantly in value and user base. Jacks attributes these successes to his ability to identify and support innovative founders who can transform ideas into profitable businesses 5.

We've been very lucky in a handful of cases to invest at inception and help companies build businesses that are producing between five and 50 million in revenue.

--- Joseph Jacks

His fund, OSS Capital, has led numerous funding rounds and even achieved a successful exit with the sale of Remix to Shopify, demonstrating the potential of open source ventures to achieve substantial financial success 2.