Open Source — Use It Right (or Risk It)

Open-source software can accelerate development, but misusing licenses or combining incompatible code can create legal exposure. Founders must track and manage usage carefully.

Why it Matters

Open-source software powers modern startups — but using it without understanding the license terms can lead to lawsuits, public code exposure, or blown M&A deals. Open source is free — but not risk-free.

Founders Checklist

Keep a list of all open-source components in your product
Understand the difference between permissive and copyleft licenses
Avoid incorporating GPL, AGPL, or other restrictive licenses without legal review
Use tools to track OSS usage (e.g., FOSSA, Snyk, WhiteSource)
Create a simple open-source use policy for your dev team

Founder Fails

Used GPL code in a core product > had to rewrite before Series A
Didn’t track OSS dependencies > failed diligence with acquirer
Added “copy/paste” snippet from GitHub > it contained AGPL license text

When to ask for Help

Before integrating open-source libraries into your codebase
If unsure about license types (MIT, GPL, etc.)
When modifying or distributing open-source code
If you're building a product on top of open-source frameworks
During investor or acquirer code reviews

Frequently Asked Questions

Q: What’s the difference between MIT and GPL licenses?
A: MIT/Apache = permissive (use freely, no major restrictions)
GPL/AGPL = copyleft (you may need to open source your own code if you use it)

Q: Can I sell a product that includes open-source code?
A: Yes — but only if the license allows it. Most do (e.g., MIT, Apache), but others (e.g., AGPL) impose strong redistribution requirements.

Q: How do acquirers or investors check for OSS risk?
A: They’ll often run a code scan during due diligence. If problematic licenses are found, the deal can be delayed, renegotiated, or killed.