Merit Systems Raises $10M for Open-Source Attribution Protocol

On January 16, 2024, the tech startup Merit Systems raised $10 million in its seed funding round. Leading the investment were Andreessen Horowitz and Blockchain Capital, well-known supporters of crypto-focused ventures.

Merit Systems is creating an attribution protocol tailored for open-source software. The tool will track contributors’ efforts and fairly distribute rewards based on the value they generate.

Merit’s founders envision a future where open-source projects thrive under a more sustainable financial model. By moving beyond dependence on donations and corporate sponsorships, they aim to prioritize fair rewards based on actual contributions to the project’s success.

The platform will incorporate an advanced attribution system into tools like GitHub, allowing investors to fund targeted codebases and providing developers with incentives to work more efficiently and effectively.

Ryan Sproule, Sam Ragsdale, and Mason Hall, the founders of Merit Systems, bring a robust background in tech and crypto to the venture. Sproul worked at Blockchain Capital, while Hall and Ragsdale developed their skills as part of Andreessen Horowitz’s investment teams.

In its seed round, Merit Systems raised $10 million, elevating its valuation to $55.5 million.

Why Merit is the Solution Open-Source Needs

Open-source software frequently grapples with the challenge of sustainable financing. While developers contribute their time and expertise, fair remuneration is often out of reach. This leaves projects reliant on donations or corporate funding, limiting their ability to grow and maintain independence.

Funding in the open-source space is far from equal: popular projects enjoy ample support, while lesser-known efforts are often neglected. This imbalance harms the ecosystem’s diversity and growth.

Merit addresses these challenges with its attribution protocol, designed to track and reward contributions proportionally. By ensuring fair compensation, it establishes a sustainable foundation for open-source innovation.