Vercel ends open-source sponsorship program giving projects 24hr notice

I guess they’re facing severe financial strain

https://medium.com/@alt.cap/time-to-get-fit-an-open-letter-f... /s. Or no /s? idk anymore. You decide.

VC money hose is drying up I suppose

Wait, so Vercel is not profitable?

How tf? They're the most overpriced product I pay for (and I like it, no complains).

Revenue is no match for throwing massive bags of money at the marketing bonfire. Subsidizing open-source projects is ultimately a marketing spend - sounds like the marketing budget is getting cut.

Unlike other kinds of marketing, though, you can get a lot of bad press for cutting the budget for this one.

Idk what you mean by the link, or the <s>, or what you don't know anymore, or what we can decide in this matter, or really what the matter at hand is, at all.

Focusing on the article:

Is there something I missed? Or did I get it right after reading 2x, and it really is just a random blog from 2 years ago advocating for bigcos to reduce headcount? If so, is that related in any way to Vercel cutting their sponsorship program for hosting for open source projects?

“VC Money Hose” has been redirected to anything with AI in the name. “Vercel, powered by AI” would receive plenty of funding. ;)

Basically you can read that above article as: Hey Mark, we've got a bunch of our money riding on your stock going up, so make your stock go up. I know in the past (2010-2022) we wanted you to grow like crazy and throw money around and grow some more, but like now with interest rates not 0 anymore and stuff, we need you to like start making money and you know, make the stock go up and up. K, thanks, bye.

I found it funny because these are the same VC who spent a decade throwing money at anything with first Cloud, then ML/Deep Learning, then Blockchain, then threw money like no tomorrow during Covid, and now are like, yeah, we want you to not do any of that stuff anymore, just like actually make money now.

The '/s' is an indicator of sarcasm in text, you'll see it in online comments from time to time. Hard to convey sarcasm online otherwise.

And yes, as the other guy said, oh you're an AI company!? Here's a few million. We'll see how long that hype lasts for these "AI" startups.

Basically. So many startups pivoted so hard to try and get some AI exposure it's absurd. An insurance startup is now an AI insurance startup, finance startup is now an AI finance startup, accounting startup is now an AI accounting startup, blockchain startups are now AI-blockchain startups.

This to shall pass.

> Subsidizing open-source projects is ultimately a marketing spend

They say 2M in Vercel credits. How much is that in actual money?

Is it fair though?

While I think them ending support from a day to another is terrible (should've given much more time to address it) at the end of the day they have put lots of money in open source ecosystem and hired plenty of devs to work on their own projects (not even Vercel's).

Hopefully, much less, or Vercel is indeed bleeding money and not long for this world.

I wonder if negotiating with Cara on their $98k bill which got some press caused them to need to recoup costs elsewhere. (Just a wild guess based on the timing.)

https://www.infoq.com/news/2024/06/vercel-serverless-scale-e...

They closed $250M in funding about a month ago. Feels more like new investors want a healthier balance sheet for possible IPO or just redirect cash flow - probably with the goal to dump more resources into AI (which they likely promised to do while fundraising).

source for vercel series E which AFAIK they have not announced https://x.com/ilyasu/status/1791182579837829199?s=46&t=90xQ8...

Thats the whole game. The founders have already made shit tons of money. I see the CEO investing in a ton of other companies. All while building a loss making company. It really is the equivalent of selling 100 dollars for 99 while pocketing shit tons of money on the side.

Is next js good? Sure. But so was jquery back in the day and they didn't need the 250 million in cash to burn through.

I’d say in this case it’s fair for them (or anybody else in a similar position) to get some nonzero amount of negative press, just as a matter of disincentivising the behaviour in question. Putting out a fair nonzero quantity of negative press, though, is not something humanity has figured out—the amount of bashing one receives for doing something bad (in the same general class of bad things) is always fairly random.

Why should they get bashed at least some? Because, if we’re treating this strictly as marketing, the deal they proposed to OSS maintainers was, basically: you spend the effort of building things on top of our non-second-sourceable offering; we give you free use of said offering; you give us marketing in the form of homepage badges, procurement suggestions at your workplace, etc. No money changed hands and no contractual obligations were accepted by the provider, but this is still very much a deal, and the porting at the outset is effectively an advance.

So the harder it is to move away from the offering—the larger the advance—the more bashing is deserved. And Vercel is pretty hard to move away, from what I understand, certainly more so than, say, Travis CI.

(Also, that public press release is pretty much a lie in how it attempts to leave a very misleading impression using technically true statements, and I’m never not going to be bashing people or companies for lying or bullshitting. Yes, I know it’s very common and in many cases effectively a legal necessity, I’m still not going to stop.)

Should the other good things they’ve done mean they’re exempted from the bad press? Ideally, no: the only way to have an adequate picture of a thing is to have a fair sample of its good and bad things. Biasing the sample by hand rarely makes things better unless done with a careful and systematic approach, which the cat herd that is the press is not really capable of collectively. Practically, still no, I think: there are enough of those kinds of biases that I prefer to avoid piling up more as a general principle.

Finally, would it be fair to go from “Vercel did bad thing” to “Vercel bad”, in view of those other good things? No, I think, but I wasn’t suggesting that. I did adjust my idea of their trustworthiness down fairly heavily, though. (It is possible to do good, even well-intentioned things and at the same time not operate your service in a reliable or trustworthy way.)

Credits isn't the same thing as either revenue or costs. Look at kids pirating Photoshop and Maya to learn the tools and make cool shit - that's not really lost revenue, because kids just don't have that kind of money to spend on professional tools to begin with. Most open source projects taking Vercel credits don't have the money to pay Vercel in the absence of credits, so this doesn't result in lost revenue. And it's not the same as costs, because if it did, then Vercel wouldn't be making a profit.

The only reasonable way to track this is to understand how much each customer costs (in servers, hardware, etc) and internally attribute those costs to marketing instead of revenue.