For eCommerce businesses to thrive, they need financial providers that offer cost-effective business checking accounts that integrate with popular eCommerce platforms. Business services that provide seamless payment for customers and vendors are also vital. Our list includes fintech companies offering innovative account features and traditional banks providing full-service banking products to support the growth of your online business.
We review the 10 best banks for eCommerce businesses.
Below, we summed up the top features we considered for the 8 financial providers. Here is our list of the best banks for eCommerce businesses.
Our rating: 4.50 out of 5
Bluevine is an excellent fintech offering high-interest business checking accounts with unlimited transactions and a line of credit financing with easy qualification requirements. New eCommerce business owners can open the basic tier, Bluevine Standard, and earn a 2.0% APY up to $250,000 for qualifying balances. Once your eCommerce enterprise takes off, you can easily switch to Bluevine’s higher tier products, Bluevine Plus or Bluevine Premier, to take advantage of higher yields (3.0% to 4.25%) and discounted wire transfer rates and same-day ACH fees.
We ranked Bluevine as the overall best bank for eCommerce businesses since it integrates with one of the most popular eCommerce platforms, Square, which allows easy online payments. Bluevine is also compatible with other top accounting and payment software, QuickBooks, Wave, Wise, Venmo, and Cash App, among others. Company owners with an international clientele can also send payments to 32 countries in 15 currencies, and these payments can be available within 24 hours.
Note that cash deposits are accepted by Bluevine but have corresponding fees
.
| Pros | Cons |
|---|---|
| Three business checking options with high interest rates (2.0% to 4.25%). | Cash deposit fees at Allpoint+ ATMs and Green Dot locations. |
| No minimum balance requirement, opening deposit, or monthly fee for Bluevine Standard. | Charges $2.50 for non-network ATM use on top of operator surcharges. |
| FDIC insurance of up to $3 million. |
Our rating: 4.19 out of 5
A renowned traditional bank, Chase provides integrated payment solutions and partners with Authorize.net to make it easy to accept card payments on your eCommerce website or through your mobile device. Chase gives you the option to open three business checking accounts with waivable fees. Aside from this, the bank has a full lineup of business savings, certificates of deposit (CDs), business credit cards, lending products, and merchant services. You can access in-person customer service from over 4,700 branches in 48 states.
We consider Chase one of our best banks for eCommerce businesses because it features robust payment solutions, including a free payment processor, QuickAccept, which lets you receive phone payments and send secure payment links. QuickAccept is free when you open the lowest tier account — Chase Business Complete Banking. You can also access it through the Chase mobile app. Additionally, QuickAccept funds can be deposited for free into your account on the same day. Free digital invoicing is also available from your bank account, helping you track the payments processed via QuickAccept.
Opening a Chase Business Complete Banking account does not require an initial opening deposit and a required minimum balance. You get 20 paper transactions, unlimited electronic transactions, and a monthly cash deposit allowance of $5,000.
| Pros | Cons |
|---|---|
| $5,000 free cash deposits monthly for entry-level accounts. | No interest earnings. |
| Unlimited electronic transactions | Only 20 fee-free paper transactions. |
| $300 cashback bonus for new accounts (conditions apply). | $3 ATM fee when using nonnetwork (waived for higher-tier accounts). |
| No required opening deposit and minimum balance. | High balances to waive the monthly fees for premium checking accounts. |
Our rating: 4.17 out of 5
Mercury is a fintech favored by tech startups for its fee-free business checking account with unlimited transactions, solid startup services, and high FDIC insurance of $5 million ( via partner banks’ sweep network). Its Shopify, Square, and Stripe integrations support eCommerce businesses and streamline operations. Mercury offers tiered workflow plans for faster payments through bill pay. You can benefit from advanced automated accounting when you subscribe to its paid plans, Mercury Plus, or Mercury Pro.
Unlike other financial providers requiring you to subscribe to a higher plan to waive wire fees, Mercury sets itself apart by offering free domestic and international wire transfers. If you are an eCommerce entrepreneur, you can save a lot when paying your local and overseas vendors. You can also access software deals on business tools, like Google Cloud, QuickBooks Online, Gusto, and Slack, which makes running your online business more efficient. Mercury is also compatible with other business software, such as Xero, Zapier, Amazon, and PayPal.
| Pros | Cons |
|---|---|
| No opening deposit, minimum balance requirement, or monthly fee. | Cash deposit is not allowed. |
| Fee-free wire transfers. | Sole proprietorship and trust accounts cannot be opened. |
| 1.5% cashback on all domestic and international credit card spending. | The checking account does not bear interest. |
Our rating: 4.13% out of 5
Novo is a digital provider that widely supports eCommerce businesses by offering a fee-free checking account which integrates with top eCommerce platforms, such as Stripe, Square, Shopify, eBay, Amazon, WooCommerce, and Etsy. Online shop owners can easily send unlimited and free invoices, receive their Stripe funds quickly, and pay vendors on the same day. For overseas payments to suppliers, you can process international transfers at a low fee, courtesy of Novo’s partnership with Wise.
Novo accommodates the needs of online store owners, Amazon sellers, and dropshippers, by making Stripe payments available within hours through Novo Boost. The seamless connection with Stripe provides transparency since you can easily check your available Stripe balance in the platform. If you need to increase product orders, you can also make vendor payments using Express ACH to ensure that funds are received on the same day. With Novo, you can open 20 reserve accounts to separate your business expenses, receive ATM fee refunds of up to $7 monthly, and connect with essential business solutions, QuickBooks, Xero, and Wise.
The Novo Business Checking account features unlimited monthly transactions and allows cash deposits exclusively through money orders.
| Pros | Cons |
|---|---|
| Up to $7 monthly ATM fee refunds. | No interest earnings. |
| No opening deposit or monthly fee. | No direct cash deposits. |
| No minimum balance requirement. | No debit card cash back rewards. |
| Pros | Cons |
|---|---|
| $900 welcome bonus. | Minimal interest is offered for interest-bearing checking products. |
| No monthly fee for basic tier checking. | Steep balances required to waive monthly fees for high-tier accounts. |
| Cashflow tools. | Low free cash deposit limit for basic accounts. |
Our rating: 3.94% out of 5
The fintech Relay offers a fee-free business checking product that integrates with eCommerce platforms Square, Stripe, and Shopify. It also connects with payment and money transfer apps like PayPal, Venmo, Melio, and Wise, including accounting software QuickBooks Online and Xero. Online companies with large teams can apply for more business checking accounts and debit cards to streamline expense management. You can also assign different permission levels for each employee to divide financial tasks.
For eCommerce businesses with large teams, it is possible to open up to 20 checking accounts and issue up to 50 Visa debit cards, both virtual and physical cards to employees. This makes it easy to track and control business expenses. An advantage Relay offers over other financial providers is allowing its customers to deposit cash for free at over 55,000 Allpoint ATMs. No ATM withdrawal fees are also charged by Relay, although operator surcharges can apply.
The Relay business checking account has no monthly fee and provides unlimited transactions. To take advantage of fee-free wire transfers and same-day ACH transfers, you can upgrade to Relay Pro at $30 monthly. Additionally, you can auto-import bills and batch bill payments.
| Pros | Cons |
|---|---|
| Fee-free incoming wire transfers. | No APY for checking accounts. |
| 20 subaccounts under a single ID (10 for sole proprietors). | Lacks business financing options. |
| No required minimum balance, opening deposit, or monthly fee for Relay Standard. |
Our rating: 3.89% out of 5
North One is a fintech platform that offers convenience to eCommerce business owners by providing an account where you can view sales, payments, and spending in one setting. Although you need an opening deposit of $50, you won’t need to pay a monthly fee. It also integrates with popular eCommerce tools, such as Shopify, Square, and Stripe, which makes it easy to monitor your business income and expenses. Unlimited subaccounts are available to track transactions from other product lines. If you need additional working capital, North One provides financing through lines of credit and term loans.
A North One standard account is ideal for eCommerce entrepreneurs since one of its main features is a budgeting tool, Envelopes, where you can categorize different business expenses for a more organized approach. Another key offering is its wide range of integrations spanning accounting, financial management, invoicing, payments and eCommerce, payroll, and productivity. These software and tools allow you to run your online business smoothly. If you often send same-day ACH, you can upgrade to North One Plus ($20 monthly) for fee-free transfers.
To deposit cash in your North One account, you can transact at Green Dot retail locations (up to $4.95 per deposit). Standard users get one cash deposit fee refund, whereas Plus users get three.
| Pros | Cons |
|---|---|
| Unlimited transactions. | No APY is provided. |
| Sales, payments, spending, and budgeting are viewed in one place. | Lacks interest earnings. |
| Its budgeting tool helps categorize funds. | No savings accounts. |
Our rating: 3.86% out of 5
Revolut offers eCommerce businesses an all-in-one finance platform that supports global payments and multi-currency accounts. You can issue employee cards for better expense management, use analytics tools, and integrate with top eCommerce solutions such as WooCommerce, Prestashop, Adobe Commerce, OpenCart, Shopify, and BigCommerce. Revolut business accounts are available for companies and freelancers in a free or paid plan.
If your eCommerce company operates internationally, then opening a Revolut account can be valuable. You can make low-cost international transfers using multi-currency local accounts. You can also hold and exchange 25 currencies and spend up to 150 local currencies, which makes cross-border payments more affordable.
Revolut tops other providers by offering its own payment gateway for eCommerce businesses. Through Revolut Pay, advanced payment solutions are available for fast and secure payments. Checkout processes are also simplified. Diverse payment methods are supported, making it convenient for your customers to use their preferred digital payment mode.
| Pros | Cons |
|---|---|
| No monthly fees for the Basic Business Account. | Free international transfer allowance is available for paid plans only. |
| Hold and exchange 25 currencies. | 2% ATM withdrawal fees regardless of the amount. |
| Speedy local and international payments with free transaction allowances for some plans. | Cash deposits are charged up to $4.95. |
We looked at the following factors when evaluating and assigning a rating for the best banks for eCommerce businesses:
To create the list of the best banks for eCommerce businesses, we reviewed the different providers’ eCommerce integrations, including their available business tools. We also checked a bank’s ability to send international payments and provide APY earnings. In addition, we evaluated the account’s fee structure, specifically its monthly fees, transaction limits, initial deposits, and maintaining balance requirements. Further, account features and other available business products and services were also considered.
It is recommended for small business owners to open a business account for eCommerce to separate their business revenue from their personal funds. In addition, opening a business bank account helps you build business credit, ease tax preparation, and establish business credibility.
An eCommerce merchant account is a specific bank account tailored for eCommerce businesses to accept online customer payments. Using a secured payment gateway, customers can pay for an online product or service from their bank account to an eCommerce merchant account.
This article was reviewed by our banking expert Tricia Jones.
In today’s digitalized world, starting a business doesn’t always mean you have to have a good chunk of money and years of experience in the field. Yeah, it’s good if you have them, but even without them, you can start a business and make money. Not just a few hundred dollars; some businesses can even make you a millionaire if you invest your time and available resources into them.
You need to have the right approach and the proper set of skills to make that happen. And you can learn such skills for free on the internet. So, all you need is the willingness to put in the work and effort it needs.
In this post, you’ll see 5 most profitable online business ideas that you can start today for free. You don’t need anyone to help you with these businesses when you’re starting out; you can do it all alone, and you can manage these businesses from the comfort of your home.
Even if you don’t know a single thing about these businesses, you can learn them for free on YouTube, Udemy, and the Interent. There’s more than enough free resources out there about these topics to take you from 0-10 real quick.
So, sit down and grab your popcorns, because this article might be the only thing you need to launch your first online business, today itself!
Please note: This post contains affiliate links to products I use, trust, and recommend. If you choose to purchase a helpful product using these links, I may receive a small commission for referring you – at no extra cost to you. These funds help me keep this blog up and running.
Affiliate marketing is one of the most profitable and easy-to-start businesses out there. In affiliate marketing, you need to promote someone else’s product in order to make money. The person who promotes the product in exchange for some commission is called an affiliate.
When you sign up to be an affiliate of any program, you’ll get a unique link to promote the products called an affiliate link. You need to use your affiliate link to send customers to the seller’s page. That link tracks the amount of sales you generate to determine the money you make.
You don’t need to create, package, or ship the products yourself. The seller who is selling the product will do these all. All you need to do is, refer customers to the seller. And when the customer referred by you through your affiliate link makes a purchase, you get a small percentage of the sale amount as a reward. That’s it. That’s what affiliate marketing is!
Through affiliate marketing, you can promote both physical and digital products.
You don’t always have to sell products to earn affiliate commission. Sometimes, you get commission to make people download something. That can be an app, software, or browser extension. Sometimes, you get commissions to make people sign up for particular websites or services. Sometimes, you get commission to generate leads for businesses and agencies, etc. All these things need to be done through your affiliate link in order for you to make a commission.
1. Choose your Niche
You need to choose a niche to start affiliate marketing. You can’t promote everything from workout gear to making money online courses yourself! So, choosing a niche is very important to succeed in affiliate marketing. Some popular niches for affiliate marketing are: health & fitness, finance, home & kitchen, technology, relationships, etc.
2. Find the Product
After choosing a niche, you need to find a product to promote. If you decide to get into the health and fitness niche, then you can promote workout plans, weight loss supplements, keto meal plans, hair loss products, and so much more. So, decide what you want to promote and find a good product for it.
3. Build a Platform
Now, you’ve decided your niche, and your product is ready to promote, so all you need is a platform to promote it. You can promote affiliate products either through a blog or through social media. You can write articles on your blog or grow your social media accounts to share your affiliate links.
Here are some popular affiliate marketing platforms you can join.
The affiliate marketing industry is worth nearly $17 billion. So, you can start your affiliate marketing journey today to get a small chunk of that seventeen billion dollars for yourself!
Selling digital products is another great way to make a hefty amount of money online. Digital products are a great way to share your knowledge and creativity with the world while making some money.
Digital products are products that are created and sold online. They don’t exist in the real world, except for printables. Printables are graphics that are created digitally but needs to be printed out in the real world to be used.
From ebooks to online courses and printables to music, there’s a wide variety of products that you can create and sell.
Here are some digital products that you can create and sell easily.
If you’re wondering which digital product sells the best and which one you should sell, consider this analysis done among 96,000 creators by influencers.club. According to the analysis, online courses were the most sold digital products, with 35.7% of the entire digital products sold, followed by ebooks (7.3%) and cookbooks (3.8%).
Here are a few more:
Check out 16 Best Digital Products to Sell in 2024
1. Choose Your Niche
The first step to building a profitable digital product business is to choose a niche that you’re interested in and have a demand in the market. You can select a niche based on your expertise, passion or to profit from an untapped market opportunity. Make sure that there are enough people willing to pay for your products so that you can make a good amount of money selling them.
2. Create Your Product
After choosing a niche to get into, you need to create a solid product to sell. In order to get constant sales, your product needs to be highly valuable. Either it needs to solve your customer’s problem or it needs to add significant value to their life. Make sure that your product is up-to-date, functional, and user-friendly.
3. Set up a Platform to Sell
Now that you have decided your niche and your product is ready to sell, all you need is a platform to host and sell your products. You can either sell digital products through your own website or through platforms like Etsy, Gumroad, Teachable, etc.
You can sell ebooks, printables, planners, digital arts, wallpapers, templates, etc. through Etsy and Gumroad. And to sell online courses, you can use platforms like Teachable or Udemy.
You can use graphic design tools like Canva and Adobe Illustrator to create printables, stickers, templates, wallpapers, etc. And you can write your ebook on Google Docs or Notepad and save it as a pdf to sell it.
4. Price Your Products
After your product is ready and you’ve decided a platform to sell, you need to set a price to sell your products.
Pricing is a really crucial part. You can’t price it too high or too low. If you price it too high, very few people are likely to buy it, and if you price it too low, you won’t make enough profit.
So, while pricing your product, evaluate the product yourself and do your market research to analyze your competitors pricing to determine your own product’s pricing.
You can promote your digital products by creating video/image content, writing blog posts, email marketing, paid ads, SEO, and through social media marketing.
Digital products can be a great way to make money online passively without needing much work and attention. So, this might be something you would love to get into! The best part is, there is no limit on how much money you can make. Ana from TheSheApproach has made over $55,000 selling ebooks alone through her small blog.
Print on Demand, or POD, is gaining immense popularity in recent times due to its business model. Print on demand business has less to no startup cost, which makes it easier for anyone to get into it.
In Print on Demand business, you create designs to print on mugs, t-shirts, hoodies, caps, pants, etc. After your design is ready, you find a print-on-demand supplier to print and sell your products.
Unlike other type of businesses, in POD, the products are not produced first and listed for sale later. Instead, the products are promoted first and only produced or printed when a customer places an order.
In POD, your job is to create designs and market your products. Your POD supplier will do everything else, from printing, packaging, and delivering the product. They will even handle the returns if they have to.
1. Choose a Niche
First of all, choose a niche you want to start your business in. Choose a niche that has huge demand in the market and something you’re interested in. For example, if you’re interested in sports, you can create designs related to sports, print them, and sell them.
2. Create Your Designs
After you’ve chosen your niche, you need to create designs to print on products. Good designs attract more eyeballs and generate more sales compared to plain, low-quality designs. So, put your maximum effort into creating good designs. Your designs might be the only differentiator between success and failure of your POD business.
3. Choose a Print on Demand Supplier
After your design is ready, you need to find a good and trustworthy POD supplier to print and supply your products. Choose a supplier that uses high-quality materials to create products, has less fees, low shipping time, good customer support, and large area coverage. These things are crucial for your business’s success.
Here are some popular print-on-demand suppliers:
4. Set up Your Store
Now that your product is ready to sell, you need to find a platform to sell it. You can sell your POD products on Etsy, WooCommerce, or eBay, or setup a Shopify store to sell them. Your store must be clean and colorful to convert more visitors into customers.
5. Price Your Products
After your store is setup, you need to price your product. Make sure to check your competitors prices before pricing your own products. You can’t sell your products for significantly more than what your competitor is selling for. If you do so, you won’t get as many sales as you would have with a lower price point.
You can market your Print on Demand products mainly through social media and paid ads. You can start and grow a social media account to promote your POD products for free.
The print-on-demand market is worth more than $7.24B in 2024 and is projected to reach $43.4B by 2030 with a growth rate of staggering 26.8%. So, this might be the chance to dip your toes into the world of ecommerce with print on demand.
Dropshipping is one of the hottest and most popular online business right now. It has made thousands of teenagers and 20-year-olds millionaires, and its craze is not going down anytime soon.
Dropshipping is a business model where you find a product, advertise it, and generate sales, but someone else produces, packages, and ships them for you.
You buy products for less price from retailers or even manufacturers and sell them for a higher price through your own store. For example, if I find a cool watch on Alibaba.com that I can buy for $7 a piece, then I will create my own store to advertise that product and sell it for $20, $30, or even more. That is how you make money with dropshipping.
In dropshipping, you don’t have to worry about producing product, packaging, shipping, or keeping a product inventory because whenever an order comes in, you forward that order and customer’s details to your supplier, and then your supplier will produce, package, and deliver the product to your customer. There are several tools and softwares to automate this entire process. Here you’re basically a middleman reselling the products.
1. Find a Product
To start a dropshipping business, first you need to find a product that solves a specific problem of your customers. Sometimes the product can be a fashionable or decorative item like a watch. The product has to have a high potential to sell. In the world of dropshipping, a product that solves a problem and has a high potential to sell is called a winning product.
2. Find a Supplier
After finding a good product to sell, you need to find a supplier who can supply you the same product for a cheaper price. A supplier can be the making or breaking point of your business because your job is to promote the product and bring customers. Everything except that is done by your supplier, so if you find a good supplier, you won’t have or have very few problems in your business, and vice versa.
So, before choosing your supplier, check their product quality, delivery time, packaging style, and customer service. A good supplier must have high-quality products, low delivery time, good packaging quality, and good customer support.
AliExpress is the go-to platform to find suppliers and products at a cheaper price, for dropshipping.
3. Build Your Store
After you’ve found a good product and a reliable supplier, you need to build a store to market your products. You can create your store on platforms like WooCommerce, Shopify, GetResponse, and Wix or sell them directly on Amazon or eBay. The design of your store must be clean, simple, and colorful to get more sales.
4. Market Your Store
After your store is setup and ready to sell, you need to advertise it, to bring customers to it. To advertise your store, you can use social media, paid ads, content marketing, SEO, and more.
Most dropshippers advertise their store through either Facebook or TikTok ads and through content marketing by creating viral pieces of content for TikTok, Instagram reels, and YouTube shorts.
That’s it! That’s how you can start your own dropshipping business and profit from the $250B dropshipping industry.
Now you know what dropshipping is, but have you ever heard about dropservicing? Huh? Dropshipping deals with selling physical products, but dropservicing is all about selling services.
Dropservicing, also known as service arbitrage, is a business model where you sell services to clients. But instead of doing the work yourself, you outsource the work to a third-party service provider, either a freelancer or an agency. In dropservicing, you’re basically a middleman, just like in dropshipping, who acts as a service seller in front of clients to make money without doing any work yourself.
Whatever remains after paying your service provider from the amount your client paid is your profit. For example, if you find a client who is ready to pay you $1000 to edit a video for him. Then you find a freelancer or a video editing agency who can edit the same video for $400, then you can keep the remaining $600 with yourself. The more you charge your client and the less you pay your service provider, the more money you make. Didn’t understand? Read it again, you’ll get it!
1. Choose a Niche
To start a dropservicing business, you must be good at some kind of skill or a particular niche. That can be web designing, video editing, graphic designing, content writing, etc. Even though you’re not the one doing the work, you need to have proper knowledge and skill in the field to convince your client that you’re capable enough and a perfect fit for the work.
2. Find Your Service Provider
After you’ve decided your niche, you need a service provider to do the required tasks for you. While choosing a service provider, you need to make sure that they are good at what they do; otherwise, you’ll end up with a low-quality output that may not satisfy your clients and may not fulfill their requirements. You can find service providers on platforms like Fiverr, Upwork, Freelancer, etc., or on social media platforms like Facebook and LinkedIn.
3. Setup a Platform
After you’ve decided your niche and found the service providers, you need to market your services in order to get clients. To do so, either you can create your own website, create a profile on freelancing platforms, or promote your services through social media.
While setting up a platform, you need to add your portfolio, past works, pricing, client testimonials, and contact information. Don’t worry if you don’t have any of these! You can add your service provider’s portfolio and client testimonials as yours while setting up your platform.
4. Set Your Prices
Before you launch your dropservicing business, you need to set a price for your services. While setting up pricing your services, find out how much your service provider is charging for the service you’re going to sell, and set your prices accordingly. For example, if your service provider charges $400 to edit a video, you can set your video editing price at $600, $700, or more.
You can promote your dropservicing business through content marketing, SEO, social media marketing, cold outreach, paid advertising, and freelance platforms.
Cold outreach is a process where you reach out to or contact someone via email who doesn’t have any connection with your business. The email is meant to aware them about your product or service and provide them with an offer.
If you’re thinking of starting a blog to get into affiliate marketing, then I would highly suggest you create your blog on either Wix or WordPress. These two are the best blog builders out there.
And if you’d like to create your own website to promote your digital products, dropshipping/dropservicing business, and print-on-demand products, then I would suggest you use GetResponse’s simple drag-and-drop website builder. It’s very easy to use and completely free to create and manage a website for lifetime. Getresponse also has its own email marketing tool, so, if you want, you can even start email marketing with it for completely free!
1. Stay Consistent: You won’t see results overnight, so you need to be consistent to get results and make money.
2. Learn, Learn, Learn: Whatever business you get into, learn about it as much as you can. Learning will help you gather more knowledge about the topic, which ultimately helps you to get better results and earn more.
3. Be Patient: Many people give up too early because they are really, really impatient. Remember, great things take time, and if it were so easy and fast, then everyone would have done it.
4. Provide Value: If you want to make money, then you need to provide something that is equally valuable to your customers. So, make sure your main motive is to provide value along with making money.
So, these were the 5 most profitable online business ideas that you can start today for free. Let me quickly recap them for you. 1. Affiliate marketing 2. Selling digital products 3. Print on Demand (POD) 4. Dropshipping 5. Dropservicing. Make sure to give them a try if you’re thinking of starting an online business. And tell me in the comments, which one of these businesses would you start if you have to?
A CEO is no longer expected to talk candidly about open source. Maybe business leaders have never expected open source to be anything but serve their business interests. Not every CEO takes advantage of open source to the degree we have seen in recent months. But no one is free of blame. Open source means different things to different people, and everyone uses it for their own purposes.
The colloquial use of open source gives companies like Meta the opportunity to use open source as they wish. Even high-ranking people in the open source community discount the problem. They say it’s OK. Open source is still moving forward. The kids don’t care — all they want to do is build models.
There is no playbook or good versus evil here. Many thoughtful people want to find a way to solve the mess we’ve seen surface in the WordPress saga of the past few weeks.
To recap, for those who haven’t been sufficiently online the past few days: Matt Mullenweg, co-creator of WordPress, the popular open source content management system, has been accusing WP Engine, a WordPress hosting provider, of violating WordPress’ trademarks and using its servers without compensation. The two organizations’ lawyers have exchanged cease-and-desist letters (more on those later). At the stroke of midnight UTC on Tuesday, WordPress blocked WP Engine’s access to its servers.
As this episode unravels, a fresh flow of ideas about open source has emerged. At least one CEO has established an important approach to solving issues like those we see with WordPress and WP Engine.
In a thoughtful post on his personal blog, Dries Buytaer, creator of Drupal, described the issue today as a makers-takers problem, where “creators of open source software (“Makers”) see their work being used by others, often service providers, who profit from it without contributing back in a meaningful or fair way (“Takers”).”
CEOs are on both sides of the perspective he details. He knows the people involved and has a solution that makes sense for the Drupal community. He calls it a “contributor credit” program.
Buytaer comes from the same world as Mullenweg. Drupal and WordPress are open source content management systems.
Still, open source is a tool for CEOs to use for profits, sometimes illusions, and leverage against commercial competitors. We’ve seen this with Meta CEO Mark Zuckerberg, who calls Llama, the company’s large language model, open source, which it is not.
And now we face someone who has long enjoyed a gleaming image in the open source community but now faces many questions about his intent.
Earlier in the week, we interviewed Mullenweg, who said WP Engine should fork WordPress.
“I think a fork would be amazing,” he told TNS. “They should fork WordPress, because what they offer is not actually WordPress. They call it WordPress, but they really screw it up.”
Mullenweg now wants to own a chunk of WP Engine, and he’s using his bully pulpit to pound away until he gets what he wants. He’s called WP Engine “a cancer.” He openly rails about the WP Engine executive team and Silver Lake, the private equity firm that has invested in it, using tactics we’ve become far too accustomed to from all sorts, who we don’t have to name here.
It’s a victim tactic. Mullenweg and Automattic, his holding company, talk like they are the victims of an evil plan, rooted in trademark violations. Following the victim’s logic, Mullenweg has to attack. He and his team have to block WP Engine from the WordPress servers.
Now comes the news from The Verge that WordPress demanded 8% of WP Engine revenues each month in exchange for being considered a contributor to the WordPress open source project. That would also mean WP Engine could not fork WordPress, but it would allow WP Engine to use the trademark.
The Verge:
“[C]hoosing to contribute 8 percent to WP Engine employees would give WordPress.org and Automattic ‘full audit rights’ and “access to employee records and time-tracking” at the company. The agreement also comes with a ban on ‘forking or modifying’ Automattic’s software, including plug-ins and extensions like WooCommerce.”
This raises questions about Mullenweg’s hearty support for a WP Engine fork. For perspective, WP Engine competes with Automattic. Just be clear on that one.
Mullenweg has made it confusing for almost everyone involved. There are huge supporters who want WordPress to survive, and there are end users who don’t have any clue about open source or even that their sites run on WordPress servers.
WP Engine, on the other hand, has its own issues. It does not give much in return for using WordPress. The company, under CEO Heather Brunner and founder Jason Cohen, uses the WordPress name. They call it fair use.
Further, WP Engine uses the work invested by the WordPress community into the service without the engineering overhead required if it had to maintain its own fork, which would cost millions and take quite some time to develop — a year, two, three?
What drama. If you are hearing about this for the first time, Mullenweg, who created the web content management system WordPress, has been relentless with his attacks on WP Engine for what he claims are trademark violations. It came to a head at WordCamp in Portland earlier in September when Mullenweg called WP Engine “a cancer” on the community.
On Sept. 23, attorneys sent a cease-and-desist letter to WP Engine on behalf of Mullenweg’s holding company Automattic and WooCommerce. Among its demands: that WP Engine stop all unauthorized use of WordPress’s trademarks and “provide an accounting of all profits from the service offerings that have made unauthorized use of our Client’s intellectual property.”
The letter suggested that “even a mere 8% royalty on WP Engine’s $400+ million in annual revenue equates to more than $32 million in annual lost licensing revenue for our Client.”
On Sept. 25, in lieu of action by WP Engine, Mullenweg blocked WP Engine’s access to the WordPress servers. He then gave a reprieve on Sept. 27 after users contacted him. Mullenweg said users thought they were paying WordPress, not WP Engine.
“They thought they were paying me, to be honest, that’s why they were pissed off,” Mullenweg said. “And so I was like, ‘Oops, OK, we’ll turn it back on.’“
WordPress blocked WP Engine’s access to its servers Tuesday at UTC 00:00.
The odd thing: no sign of trouble so far from WP Engine users; a WP Engine spokesperson declined to comment when contacted by TNS about whether the company had heard from customers having problems. WP Engine must have set up the mirrors and all to WordPress.org. How that affects performance and the rest is still not understood.
In our interview, Mullenweg said users now hopefully understand that they are paying WP Engine, which does not pay WordPress for auto updates and everything else WordPress provides. Users, he argued, should be mad at WP Engine, not him and his team, who run the servers. Again, Mullenweg expresses that he and his team are the victims.
WP Engine is simply not responding, Mullenweg said, except through a cease-and-desist letter its attorneys sent Automattic on Sept. 23 after his repeated attacks.
The letter sent on WP Engine’s behalf reads in part, “Mr. Mullenweg’s covert demand that WP Engine hand over tens of millions to his for-profit company Automattic, while publicly masquerading as an altruistic protector of the WordPress community, is disgraceful. WP Engine will not accede to these unconscionable demands, which not only harm WP Engine and its employees but also threaten the entire WordPress community.”
WP Engine did not answer The New Stack’s question about forking WordPress, but a company spokesperson did have choice words about Automattic’s licensing demands.
“We, like the rest of the WordPress community, use the WordPress mark to describe our business. Automattic’s suggestion that WP Engine needs a license to do that is simply wrong, and reflects a misunderstanding of trademark law. To moot its claimed concerns, we have eliminated the few examples Automattic gave in its Sept. 23 letter to us.”
For example, WP Engine has made some minor changes, namely changing WordPress to WordPress1 and WooCommerce1 on the site’s front page.
Overall, users had almost no warning that their sites would be disrupted. This is an odd way to treat users, especially when they are such huge fans of your platform.
Here’s where open source becomes a problem for users. Most people do not know how they get the updates to their CMS. But once their site stopped working, they became entangled in a battle between Mullenweg and WP Engine.
Meanwhile, most users are just trying to keep their sites working.
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Amidst the controversy, Mullenweg acknowledged he could have done better in reaching out to the community.
“To be fair, I have not been the best at public relations or publishing things,” he told TNS. “That’s why we try to be very clear at UTC 00, Oct. 1 … at this exact time, their network, WP Engine servers will no longer be able to access our networks.”
But a fork? The cost to set up the servers, the network, the load balancers, on and on, would cost millions and could take years. At its peak, WordPress serves 30,000 requests per second and 40% of the entire Web, according to Mullenweg.
Users have an option, he said. They can move to a different hosting provider. He mentioned Bluehost and his own company, WordPress.com, as two options.
There has been confusion about open source AI and server-side public licenses. Now, we’ve got the WordPress debacle. Oh, and there’s talk about Oracle owning the JavaScript trademark. The fun never ends.
But people are working on the problem, particularly the single point of failure issue that has become more apparent since WP Engine’s servers were cut off.
Here’s a thread worth reading from Reddit, about how to solve the problem of a single point of truth. The problem is a severe one, but maybe a fork is not the answer. Instead, perhaps it’s a way to solve matters that can easily happen if sites aren’t updated:
The vulnerability should be apparent: if WordPress.org goes down for any reason, millions of sites stop updating. A coordinated attack (zero-day implementation coupled with a DDoS attack that prevents updates from going out from zero-day) could be a disaster the world over. And, if the Foundation ever decided to get out of the update business, or ran into financial difficulty, or Matt decides to retire to Aruba and quit WordPress entirely — whatever the case may be — there’s no Plan B.
So, the community needs a plan B — and maybe that’s most important. Stop the bickering. Instead, look for ways to modernize the WordPress infrastructure so users don’t get entangled in corporate wars that use open source as a proxy to fight battles that leave casualties scattered across the web.
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“WPE’s nominative uses of those marks to refer to the open-source software platform and plugin used for its clients’ websites are fair uses under settled trademark law, and they are consistent with WordPress’ own guidelines and the practices of nearly all businesses in this space,” the lawsuit said.
Mullenweg told Ars that “we had numerous meetings with WPE over the past 20 months, including a previous term sheet that was delivered in July. The term sheet was meant to be simple, and if they had agreed to negotiate it we could have, but they refused to even take a call with me, so we called their bluff.” Automattic also published a timeline of meetings and calls between the two companies going back to 2023.
Mullenweg also said, “Automattic had the commercial rights to the WordPress trademark and could sub-license, hence why the payment should go to Automattic for commercial use of the trademark. Also the term sheet covered the WooCommerce trademark, which they also abuse, and is 100 percent owned by Automattic.”
Exhibit A in the lawsuit includes a letter to WP Engine CEO Heather Brunner from a trademark lawyer representing Automattic and a subsidiary, WooCommerce, which makes a plugin for WordPress.
“As you know, our Client owns all intellectual property rights globally in and to the world-famous WOOCOMMERCE and WOO trademarks; and the exclusive commercial rights from the WordPress Foundation to use, enforce, and sublicense the world-famous WORDPRESS trademark, among others, and all other associated intellectual property rights,” the letter said.
The letter alleged that “your blatant and widespread unlicensed use of our Client’s trademarks has infringed our Client’s rights and confused consumers into believing, falsely, that WP Engine is authorized, endorsed, or sponsored by, or otherwise affiliated or associated with, our Client.” It also alleged that “WP Engine’s entire business model is predicated on using our Client’s trademarks… to mislead consumers into believing there is an association between WP Engine and Automattic.”
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