Every few days, another founder launches a new product with a GitHub repo rather than a polished landing page. The link goes up on X, developers star it, fork it, benchmark it, complain about the docs, join the Discord and, in some cases, start building on top of it before the company has written its first proper sales deck.
This is not just a return to the old open source movement. It is part of a broader shift in how technical products are being discovered, trusted and distributed. For AI, infrastructure, developer tools and agentic software startups, open source is becoming one of the most effective early go-to-market motions. It gives founders distribution, feedback, credibility, recruiting leverage and community before they have the budget to buy any of those things.
The simplest way to put it is that the GitHub repo has become the new pitch deck. In some categories, it may be more important.
Open source as strategy, not ideology
Open source used to be discussed mainly as a development philosophy. It was about collaboration, transparency and the belief that software improves when more people can inspect and contribute to it. That remains true, but it is no longer the whole story.
Famed Benchmark partner Bill Gurley recently published an essay about “open source strategy”, arguing that open source can be used by challengers to commoditise the layer incumbents want to keep closed. His examples include Android, Kubernetes, RISC-V and Overture Maps, all cases where openness was not only a cultural choice but also a competitive weapon. The follower opens the layer that the leader wants to control.
According to Gurley, there’s a real risk we’re facing in the Western world given the absence of strong open-source alternatives to the leading LLMs, which aren’t Chinese companies.
The honest assessment is that there is currently no credible Western open frontier player. Mistral is closest, Gemma is partial, and beyond that the field is empty. The structural conditions that would call one into being , closed-Cathedral incumbents extracting rent, a Chinese-led open ecosystem demonstrating that the playbook works, are present and intensifying. The will to organize around an open alternative is not.
Bill Gurley
That idea feels particularly relevant in AI. The largest model companies have enormous advantages in compute, distribution, talent and capital. For smaller players, open source can be a way to change the rules of the game. DeepSeek showed how powerful that can be. Its release triggered a sharp reassessment of AI infrastructure assumptions and contributed to Nvidia losing close to $593 billion in market value in a single day, according to Reuters.
The lesson is not that every AI startup should open source everything. The lesson is that openness can be a strategic wedge when a market is moving quickly, developers are the first audience and the incumbent advantage depends on keeping a layer proprietary.
GitHub has become a distribution channel
The most obvious reason founders are embracing open source is distribution. In developer-led markets, attention is hard to buy but possible to earn. A useful repository can travel faster than an ad campaign because developers share things that help them build.
GitHub’s own 2025 Octoverse report is a good backdrop for this shift. GitHub says a new developer joins the platform every second, while developers created more than 230 new repositories per minute and pushed nearly one billion commits in 2025. The report also highlights how AI, agents and typed languages are driving one of the biggest shifts in software development in more than a decade.
That matters because GitHub is no longer just where code lives. It is where developers evaluate taste, seriousness and momentum. For an early-stage company, a strong repo can answer questions that a pitch deck cannot: are developers actually using this, are issues substantive, are contributors showing up, are people building integrations, and is there a community forming around the product?
For technical founders, that is incredibly valuable. Instead of trying to convince the market that something is useful, they can let the market inspect and test it directly.
The new open source winners
The most interesting recent examples are not hobby projects. They are venture-scale companies using open source as an adoption model, while monetizing managed services, enterprise features, governance, security, compliance or hosting.
LangChain is one of the clearest examples in AI. It began as a widely adopted open source framework for building LLM applications and agents, and in October 2025 announced a $125 million series B at a $1.25 billion valuation to build a broader platform for agent engineering.
Supabase, the postgres development platform, is another strong example. It positioned itself as an open source alternative to Firebase, benefited from the boom in AI-assisted and “vibe-coded” app development, and reportedly reached a $5 billion valuation in 2025.
Hugging Face, a collaboration platform on models, datasets and applications, has become one of the most important platforms in AI by making models, datasets and tooling easier to share, discover and deploy. The company was valued at $4.5 billion in 2023 and has continued to build around the open AI ecosystem.
OpenClaw is a more recent example in the agentic AI world. Its GitHub page describes it as a personal AI assistant that runs on a user’s own devices, with an MIT license and a positioning around local control. The interesting thing about projects like OpenClaw is not only the product category, but the launch pattern: the repo becomes the artifact, the community becomes the distribution, and developers can understand the product by running it rather than watching a demo.
But of course, open-source is hardly new. The older generation of open source companies proved the commercial model at much larger scale. IBM acquired Red Hat for $34 billion in 2019, still the canonical example of a massive open source software business. IBM later acquired HashiCorp, whose products include Terraform and Vault, in a $6.4 billion deal that closed in 2025. Confluent, built around Apache Kafka, reported $1.12 billion in fiscal 2025 subscription revenue.
The pattern is clear. Open source is rarely the business model by itself. It is the adoption model. The business usually comes from making the open source project easier, safer, more reliable and more enterprise-ready.
Why is open source surging now?
Several factors are making open source more attractive for founders today.
- Trust – In AI, infrastructure, security and developer tools, customers increasingly want to understand what the software is doing. This is especially true when products touch codebases, credentials, data, workflows, cloud environments or agents with permissions. A public repo does not eliminate risk, but it lowers the trust barrier and gives technical buyers something concrete to evaluate.
- Speed – In a fast-moving market, founders cannot wait six months to perfect positioning before exposing the product to users. Open source allows them to launch early, learn from real usage and let the community pull the product toward the highest-value use cases.
- Recruiting – A strong open source project is a talent magnet. Engineers want to work on things respected by other engineers. In some cases, the contributor graph becomes a better recruiting funnel than any outbound process.
- Ecosystem formation – AI agents, coding tools and data infrastructure are all composable by nature. They need integrations, wrappers, plugins, SDKs and community examples. Open source gives the ecosystem permission to form before the company can build every integration itself.
- Developer zeitgeist – Builders are used to shipping in public. They are used to sharing repos, prompts, benchmarks, models and demos. In that world, a closed beta can feel slow, while a public repo feels like momentum.
The risks are real
Open source can create momentum, but it also introduces a set of risks founders should not underestimate.
The first risk is monetization. I have a good friend who developed an agentic AI “business in a box” open source platform, similar to Paperclip. He’s not sure about ability to monetise it, given the slew of alternatives. A repo can have thousands of stars and still have no business model. Developers may love a free tool without ever becoming paying customers. In VC terms, stars are not ARR, forks are not retention and Discord activity is not a sales pipeline.
The second risk is giving away the wrong layer. The best open source companies are precise about what they open and what they monetize. They may open source the framework but charge for hosting, open source the protocol but monetize managed infrastructure, or open source the developer tool while charging for team workflows, compliance, security and governance. Founders who open the core value without a clear commercial layer can end up building a popular public good rather than a venture-scale company.
The third risk is cloud capture. If the project becomes important, a large cloud provider can host it, package it and monetize the usage. This has been one of the recurring tensions in open source business models.
The fourth risk is forks. When a company changes its license or governance model, the community can respond by creating an alternative. HashiCorp’s Terraform license change helped trigger OpenTofu, a Linux Foundation-backed fork. Redis’s license change led to Valkey, another Linux Foundation-backed fork. These examples show the delicate balance between building a company and stewarding a community.
The fifth risk is security. Open source does not automatically mean secure. The XZ Utils backdoor in 2024 was a reminder that widely used open source projects can become targets for sophisticated supply-chain attacks. In the agentic AI world, the stakes may be even higher because agents can touch browsers, files, terminals, calendars, credentials and enterprise systems. OpenClaw itself has already faced reported security concerns, including a critical vulnerability that researchers said could allow attackers to take control of a user’s system under certain conditions.
This is why open source founders need to think about governance, permissions, security reviews, plugin ecosystems and enterprise controls from the beginning. Community is a strength, but unmanaged community can also become an attack surface.
What founders should ask themselves
The right question is not “should we be open source?” It is more specific: which layer should be open, and why?
If the goal is to become a standard, openness can help. If the goal is to earn developer trust, openness can help. If the goal is to accelerate integrations and community contribution, openness can help. But if the company has not thought through monetization, governance and defensibility, open source can create as many problems as it solves.
The best open source companies know what they want the world to adopt for free and what customers will pay them to operate at scale. They understand that developers may adopt the project, but enterprises pay for reliability, security, compliance, observability, collaboration, support, governance and peace of mind.
That distinction is crucial. Open source can create adoption, but it does not automatically create a business.
What this means for early-stage investors
As an early-stage VC, I would not fund a company simply because its GitHub repo is growing quickly. But I would absolutely pay attention to the quality of that growth.
The signals that matter are not just stars. I would look at whether the project is being used in production, whether contributors are building useful integrations, whether the issues reflect real pain, whether the project is becoming a default in a specific workflow, and whether there is a clear buyer for the commercial layer.
I would also look for signs of stewardship. In open source, the company is not just building software; it is hosting a community, setting technical direction and deciding how value is shared between users, contributors and shareholders. That is a different kind of company-building skill.
For Israeli founders, this is especially relevant. Israel has deep strengths in infrastructure, cybersecurity, data, developer tools and technical AI products. These are exactly the categories where open source can create a global wedge from day one. A small team in Tel Aviv can reach developers in San Francisco, Berlin, Bangalore and Seoul without waiting for a US sales office, provided the product is useful enough for developers to try and share.
At Remagine Ventures, we are spending more time thinking about these models because AI is changing both what gets built and how it gets adopted. The next great infrastructure or agentic AI company may not start with a closed beta and a long enterprise sales cycle. It may start with a repo, a strong technical point of view and a community that forms before the company fully knows what it will become.
Open source is not automatically good, and it is not automatically venture-backable. It is a strategic choice about distribution, trust and market structure. For founders building in AI, devtools and infrastructure, the opportunity is to decide deliberately which layer should be open, which layer should be commercial and how the two reinforce each other.
Increasingly, the most interesting companies are not hiding the code. They are using it to build the market.
He is a former General Partner at Google Ventures (GV) in Europe, former head of Google for Entrepreneurs in Europe, and founding head of Campus London, Google's first startup hub. Eze writes on Israeli tech, venture capital, artificial intelligence, and founder strategy.
He is also the founder of Techbikers, a nonprofit that brings together the startup ecosystem on cycling challenges in support of Room to Read.
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