My vision goes something like this:
If a startup wants to get into the software business, instead starting from scratch, they can take an open source project and work on it, they can focus their efforts on customizing their product to a specific market which makes it very efficient because a specialized package is far better than a generic.
They definitely have a head start and their costs are greatly reduced. They will make money by further customizing the software to their customers' needs, support, client training, consulting, etc. to name just a few services for revenue. Clearly they make money, and their expenses are minimal while programmers are happily employed.
After all, Open Source companies like Redhat make a lot of money of open source.
