Open Source Capital
Generalized Definition - 2025
Open Source Capital is the combination of open source knowhow, tools, designs, teaching of skillsets, Universal Basic Assets, and other enablers of distributed wealth creation. This means substitution of capital goods with their production within a low-cost universal basic asset framework. Ie, capital hardware becomes cheaper, and in the limit of open knowhow and design - attains Zero Marginal Cost. This is a paradigm for achieving Post-Scarcity Economics/
For example, you can buy virgin steel at a dollar a pound, or make it using photovoltaic energy and open source induction furnace processes to proce steel at half or less the cost. This cascades iteratively to every element of the production process- yielding replicable 90-99 percent cost reduction for any hardware good. 99% cost reduction involves approximately 90% techological recursion, and 10x improvement over this using lifetime design to achieve approximately 99% cost reduction - defined as zero marginal cost.
2020 Notions
Open Source Capital - we define it as a modest but not insignificant (million dollar scale, or similar to the scale of seed funding) capitalization that allows seed funding of distributive enterprise, with a goal of Distributed Market Substitution. Unlike traditional finance capital (banks, VCs), open source capital is a mixture of elements that provide capital, but not in direct-and simple financial instruments such as promissory notes or venture capital agreements, but instead in a more distributed and diversified fashion, where open source collaboration is invoked as the foundation. Open source cap may be a combination of:
- Tradition money
- Swarming capital - sweat equity of many people engaged in Extreme Manufacturing or Extreme Enterprise events. The important part of OSE's discovery of the Extreme Manufacturing build method - is that swarms can be engaged for economically productive activity on a large scale. We already know of 10-100,000 person events such as rock concerts or car racing - and here we apply mass social gatherings for productive purposes to distribute capital.
- Direct, distributed stakeholdership - the customers are also, even if indirectly, responsible for product delivery in a collaborative arrangement. Customers bootstrap-fund the development.
- Heavyweight open source product management - to deliver the product, a large-scale, collaborative process is invoked.
- Open source machines - to reduce capitalization 10x, open source machinery is used, such as open source tractors, open source 3D printers, and Power Cubes
- Collaborative, open source design - the source of any capital-intensive operation is design. We make the design open source, to eliminate competitive waste.
- Distributed funding - the enterprise is funded by the customer, not financier
In summary - the concept is that it's not financial capital that is needed to get things done - but instead - it's the things that finance capital can buy - that is required to get things done. And ruther - financial capital cannot 'buy' economic transformation - so any scalable, essentially transformative economics must be bootstrap funded. Here we substitute collaborative effort, open machines, collaborative process, and open design for financial capital to bootstrap multi-million dollar, distributive enterprises.
That is a plan. We are testing it in the second half of 2021 with the Seed Home 2 Extreme Enterprise.
For open source capitalism to work, it must reliably raise funds on the order of at least $1M. It must then be scalable towards Distributed Market Substitution on the scale of 3-5 years.
The Distributed Market Substitution, for example in Housing - refers to not all housing - but any single and multi-family affordable dwellings being made possible. This does not apply directly to mansions or highrises. It's a specific sector that addresses 80% of the entire need for housing in the next economy.