What Companies Look for When Acquiring Open-Source Companies

In a groundbreaking acquisition, IBM acquired Red Hat, a company that open-sources all of its products, for $34 billion in 2019. This changed the paradigm of open-source acquisitions, after all, this meant that IBM saw value in a purchase of software that could have been in the open to work with for this major technology player's highly qualified engineers. This begs the question: what is a company buying when they acquire a company that has a business model surrounding creating and maintaining open-source software? In this episode, we answer this question from two perspectives — what it is like to be acquired from Zach Tirrell, and what requirements the company sought from Chris Lema, who was involved in the acquisition of Zach's product. We discuss the determinants that will make an open-source software attractive for buyers, and we also discuss the human and emotional experience of selling an open-source software company.