Zinc is trying to provide a Cooperative alternative to FAANG by providing a shared architecture for data-cooperatives and special-purpose SaaS vendors, and we are driving out the design by building tools for regional cooperative networks
Most SaaS has three major costs:
- Research and Development (R&D) (What should our product or service do? Who is it for?)
- Maintenance & Support (M&S) (Now that it exists, how do we keep the value flowing?)
- Hosting and Infrastructure (H&I) (How much does a web-server cost, Michael!)
These costs intersect and flow into one another. A tighly designed product or service likely requires less Maintenance and Support. A well architected product or service has lower Hosting and Infrastructure costs. Where Moore's law drives down Hosting and Infrastructure costs, the scarcity of digital fluency in our labor market increases Research and Development and Maintenance and Support costs.
As a result, most SaaS vendors:
- Raise a pile of capital to pay these costs up-front, treating early product as a loss-leader until eventually the organization enters the Extract phase of the Product Development Triathlon
- Bootstrap by being fluent enough in business development, product development, and organizational development that you can cover your costs as you build out the SaaS offering. Often through a Consulting/Product company hybrid (ala 37Signals, Honeybadger.io, TransparentClassroom.com, etc) or
- Taking the long, slow road of working nights and weekends while working a day job (aka hustle culture)
Commons-forward, Open/Free SaaS Frameworks, such as Ghost, Wordpress, Drupal, or even Rails, Phoenix, Express, Django, etc. provide significant
starting points on the Research & Development, Support and Maintenance, and Hosting & Infrastructure side of things. Reducing the costs born by a company leveraging these tools. However, they still require high-demand/low-supply labor to continue to keep the services secure, reliable, and representative of the user-experience and accessibility standards the organization holds.
Convene attempts to further reduce the cost-basis of by:
- Collectivizing the Hosting & Infrastructure and Support & Maintenance costs into equitably priced regional or topical platform or data cooperatives and
- Providing cost advantages to designers and developers similar to folks who target App Stores by decoupling Hosting & Infrastructure and Support & Maintenance costs; without the 30% distribution tax imposed by platforms like Steam, Apple, Google Play, etc.
TL/DR: SaaS is hard because there are significant costs to building and running a proprietary SaaS (R&D/M&S/H&I).
Open Source technologies often place significant M&S, and H&I costs on the organization customizing those frameworks.
Convene attempts to loosen the cost basis for technology cooperatives by providing a multi-organizational, multi-computer operating system for commodity hardware with strong application and data portability that runs freely by any Rochdale worker-cooperative.
Thoughts? Drop them to @[email protected]!