Often when I see open source companies I notice one of their sources of funding is crowd funding? My question is why is this? Are there not any better methods of income that they could use?
Why might open source companies use crowd funding?
project management;finance
Why is crowdsourcing used? It works pretty well. Open sourcing something nearly always means a community that is interested in it. So it can work that the community is enthusiastic enough to fund the open sourced thing through crowdfunding.But there are a lot of other methods for making money. My examples for these methods are non-companies, but companies can make money with these methods as organization or persons can.Most open source projects have a donate button or something similar. That is not far from actual organized crowdfunding. Some project make fundraisers at some times, Wikipedia does from time to time for instance.Some classic open source projects release the open sourced software, but offer paid services around it: support, documentation, installation and configuration help and so on.Some projects sell premium versions of the product. That is common for open books or music, digital is free, a printed version or a CD cost something. A way Cory Doctorow makes his money.Merchandise is another way of income for an open-source-project. Selling coffee-cups, T-shirts, Posters, mousepads and so on with the logo of the project can bring a lot of money. XKCD finances itself mostly with merchandise.