"open source my ass" :)) I don't want to argue with the ass/the gut, but perhaps I can offer an explanation as to why it might feel this way.

When open source started in the mid-70s, the ethos was: give software away for free. Money came in the form of university or corporate research grants, there was no business model. Only in 1998, the money came into picture once RedHat, MySQL, and many others started doing paid support and services on top of free software. And starting mid 2000s it became common to think about making money with open source, and that's because of cloud computing. In SaaS, the user does not know or care if there is open source or proprietary software under the hood, so it leveled up OSS, put it in the same game as the rest.

Why VCs like open source? (I'm a former ML engineer turned in-vest-er), well some of it is nostalgia in my case, I used awesome OSS software while in university like spaCy and i share the same values of community, transprency, giving back etc, and some of it is related to what the job of a VC is - makin' money.

In closed source companies, one invests a lot into sales and marketing. Developers generally don't like to be sold, they can't be sold they have to choose you/your product. So if a company manages to win the hearts and minds of developers, they will pull your software in to be evaluated by procurement for purchasing without spending millions in sales and marketing, it's more efficient as a business model. It's also a lot more defensible. Big corp can pur money into suits to sell their products, but you can't buy developer love, for that you need amazing DX and good dev rel. But making money in OSS is a lot harder than in SaaS. in SaaS people talk about product-market fit (find 5+ customers who use the same way, buy the same way, get the same thing out of the product - predictability so the VC gives money and scales sales). In OSS you've got the problem 3x: you gotta get to project-community fit (you measure GitHub Stars), then product-market fit (you measure downloads) and then value-market fit (you measure revenue, and the buyer might not be the same as the developer/user). Most amazing OSS products fail at the value market-fit section.

Most founders of OSS companies fail to extract value. Some of it is because it's so hard or because people feel like OSS should be "free software" that they postpone monetization. And then when they start to monetize it's too late. would you buy a cow if you've been getting the milk for free for years? The other reason they fail is they don't know how to do it. The typical 3 ways to make money with OSS are: support (you sell support and services -e.g. RedHat), open core (you sell propritary functionality - e.g. confluent, elastic) and SaaS (you sell hosting, tooling - e.g. databricks).

One simple way to think about it, based on the successful OSS companies I've see in, the free version of the product should have everything, all the bells and whistles that a single developer needs to get the job done. and the paid product has the extra features that are needed to get the job done as a team.

I love open source software and it pains me to see super smart founders and so many contributor put so much of their passion into building it but failing to scale it, commercial helps there, and failing to get rewarded for the hard work. But it's darn hard, it's like going against your nature, if you contribute to OSS and build OSS you care about community and want to give it for free. So making money with it, just thinking about it, makes you uncomfortable. And when people are uncomfrtable, they go do what they know, where their comfort is, and that is coding for most engineers. And that's how you end up with awsome OSS software with lots of cool features and a founder who postpones monetization so much for so long than at some point it passes the point of no return and that's how another promissing company dies, nobody wants to invest if they can't get their money back even if the product is really really cool.