I’m the founder of an early-stage B2B SaaS startup building software for higher education institutions. I’ve spent the past year developing a truly novel solution to a major industry pain point. The reception has been extremely encouraging. Nearly everyone I’ve demonstrated the software to has been excited about its potential.
The problem isn’t interest. It’s adoption. Higher education is incredibly bureaucratic. Procurement cycles are long, require navigating multiple departments, and my potential customers are constantly traveling and juggling multiple responsibilities. Getting institutions to onboard new software has probven to be extremely challenging inspite of interest.
So I’m considering a different approach. Rather than selling full software integrations upfront, I’m considering an API-based, pay-as-you-go model with a limited free tier. This would let institutions experience the product’s value without the usual barriers to adoption.
I’m also considering open sourcing the software. I’m building this 100% solo, and one of my biggest challenges is that the real-world data I need to further test, validate, and improve the software is controlled by these institutions. Building the product openly alongside them could give me access to that data, accelerate development, and help establish trust.
But my concern is that, some individuals working within these institutions are exploring ways to solve this same problem internally, I’m worried that by open sourcing/developing alongside my potential customers, I’d essentially be showing potential customers how to solve the problem on their own and canibalize my own business.
External competitors, do not provide this service in the way that I do, my model is much cheaper and higher and has higher control, but my competitors are VC Backed, have stronger brand recognition, and already have relationships with universities, so by providing an open/limited free version I might alert competitors that can move faster than me.
So I’m torn between protecting my competitive advantage and opening up development to the very institutions I’m trying to serve.
For founders who’ve faced something similar, what would you do?