This is the first of a 3-part series on the Business of Developer Community building. Part 1 focuses on the initial stages of building a community and the ongoing recruitment and developer onboarding process.
$5 billion is a large number, but I believe it’s actually a conservative estimate. In reviewing more than 20 data sources, I focused on just three industry/technology segments with minimal overlap: global Fortune 500, AI platforms and hyperscalers, Web3 L1s, and major platforms. Believe me when I say building and maintaining developer communities is big business!
Creating a thriving developer community engaged in contributing code and building applications is at the heart of almost all successful projects and technologies today. But how do you effectively attract, engage, and retain developers when demand far outstrips availability in many segments and when transactional incentives make it so appealing for developers to move rapidly from project to project?
The overall demand for developers has skyrocketed as multiple sectors continue to grow. Traditional Web2 companies are actively seeking skilled developers to maintain and evolve their existing infrastructure, while the Web3 ecosystem is competing to attract talent with its promise of decentralized and cutting-edge technologies. With the explosion of AI and machine learning, the demand for developers has increased even further, creating a highly competitive environment. AI and Web3-focused projects often come with attractive incentives and high visibility, pulling talent from the Web2 space. Additionally, the Web3 incentive models drive a focus on coin price and transactional rewards and create a highly mobile workforce; the average tenure on a project is only 12–13 months. This convergence of demand across Web2, Web3, and AI has led to a significant talent shortage. It has become essential for projects to differentiate themselves by offering compelling long-term incentives, a clear value proposition, personal engagement, and a world-class developer experience.
Let’s Start at the Beginning — Developer Acquisition
When thinking about how to build an engaged and productive developer community, one of the starting points is understanding and managing developer acquisition and maintenance costs. My research into developer acquisition indicates the average cost of acquiring a developer varies significantly depending on the scope and scale of activities. These can include developer marketing, events, hackathons, airdrops, training programs, ambassador programs, cost of community and marketing resources, etc. The costs range from a low in the Web2 space of ~$1,000 to $5,000 to $10,000 in the Web3 and AI segments. With some communities in the thousands and others claiming 10s or even hundreds of thousands of developers, recruitment and retention has become an incredibly daunting and even unsustainable financial investment for some.
So, how do you balance investment with productivity? One often overlooked approach is understanding what the developers really want at the outset and continuing to assess their experience and expectations regularly. Unfortunately, a cookie-cutter approach is frequently applied, such as simply creating or moving your code to Git Hub, throwing up some social media channels, joining some industry foundations, sponsoring a few events and hackathons, etc. While these steps are essential in building a community, I recommend one critical step first: talk to your existing and target developers and ask them what they want and what will keep them involved. In one case I’m thinking of, it was as simple as rewarding highly engaged developers by sponsoring their attendance at key industry events and providing higher-caliber swag. I strongly recommend taking a three-pronged approach: one-to-one interviews, online surveys, and the tried-and-true focus groups. Each method will generate different data and insights and will help you create a solid foundation and differentiate your community.
An effective way to minimize costs is to reduce friction when onboarding new developers. A bad onboarding experience combined with a complex process for developers to get started contributing is often cited by developers as a key reason they move on quickly (thereby increasing your acquisition costs). One client I worked with some years ago had anemic 30–60–90-day developer retention numbers. After examining their onboarding and time-to-contribution process, we realized it took developers four hours over two days to begin doing anything interesting with the software. After learning from the developers how they initially wanted to use the software and simplifying the start-up process- and getting it down to 30 minutes — there was a 300% increase in developers staying engaged across the 30–60–90 review period.
Another key part of onboarding is the personal touch. It’s easy to overlook, but connecting directly with developers soon after they join can make a big difference in their engagement. Sure, it may feel like a lot of effort, but a personal email, a quick phone call, or even a weekly group call with new joiners goes a long way in making them feel valued and supported.
Developers are naturally curious — they love to dive deep into understanding how things work and figuring out ways to improve them. However, to invest their time, they need to see a clear value proposition. Whether it’s the chance to work on something cool and innovative, build their own business, or contribute meaningfully to their employer’s success, developers need to understand the return on their investment. Knowing what motivates each developer and helping them achieve their goals is essential for building a thriving and engaged community.