Ask HN: In 2016, how would a open source software make money in Bay Area?
The question is not new, but the world changes and the system of opportunities change as well... Is it possible to do an open source product and still make money out of it?
Making money from software is hard. When you're talking about creating a new product or service, the odds are against you i.e. it's more likely that you'll fail than succeed.
Making money from open-source software is 5-10x harder because open-source removes exclusivity, which is the most important thing that pushes people over their dislike of paying. If they can get your thing for free, they won't pay.
That being said, sometimes well executed hybrid "open-source + something exclusive" strategy is the only way for a given product.
For example, MySQL would have no chance against Oracle, DB2 or SQL Server if it tried to compete as another expensive, closed source database. They pretty much had to give away their stuff for free to gain massive market share and sell "something exclusive" (expensive support contracts) to a small subset of their users.
One successful hybrid strategy is open source + hosting. WordPress, Ghost, Discourse, Vanilla Forums - those are all projects that are open source, you can host them yourself for free but most people don't have skills or desire to self-host, so, like MySQL, they use being open source as free marketing to gain market share and sell convenience to a small subset of their users.
You didn't specify if you're talking about single person business or a bigger team.
Hybrid strategies are usually too difficult to execute for a single person, there's just too much work writing the software and managing hosting, providing support etc.
At the end of the day you should decide what's more important: money or writing open source code.
If money, then don't take additional risk of open source.
If open source, then don't expect money.
If both then accept that you will most likely end up with neither.