Why do paid libraries succeed - even vs free?

I am not sure how many indie hackers are considering paid software libraries, but these businesses can be highly profitable, and I have been working on making this a lot easier with my SaaS, Code Code Ship.

What follows is a shorter summary of the blog post I released today on my website (link at the bottom).

The Economics of Paid Libraries

We are programmers, not businesspeople. But around us, programmers are learning to run businesses, extracting money from the value that they create, and avoiding FOSS burnout in the process. Becoming a businessperson involves a learning curve, but marrying programming ability with business skills can pay off big time, both for maintainers and their users. So what are these companies doing?

Fundamentally, successful software companies seek to amortize their large initial investment over two things: customers and time. (see graphic above)

There are a few things that are protecting these businesses:

Building cost: $20k+ is a lot to invest in building a software library
Customer lock-in: once your customers have standardized on your API, they will not be easy to move. Plus you can lock them in with long-term contracts.
New competitors have you compete with you.
Now that your solution is there, people will be less likely to create a competitor by scratching their own itch -- they'll just take what you made.

Will FOSS Eat My Lunch?

Maybe. See: BitKeeper vs Git. But also maybe not. See: Sidekiq, iText, Oban, or the many other commercially successful projects that have stood the test of time.

I interview commercially successful software library authors for the website, and I always ask a variation on the question: “why haven't FOSS alternatives been able to compete?”. The answers I get are illuminating:

“in the end, OSS burnout will kill any free project which gets traction” - Mike Perham https://codecodeship.com/blog/2023-04-14-mike-perham

“You shouldn’t underestimate the advantage of having years of experience solving real-world problems for paying customers.” - Bruno Lowagie https://codecodeship.com/blog/2023-04-07-bruno-lowagie

“Unless it's a passion or you have a vested commercial interest, there's too much startup inertia.” - Parker Selbert https://codecodeship.com/blog/2023-04-19-parker-selbert

The long form blog post:
https://codecodeship.com/blog/2023-04-28-economics-of-paid-libraries