Using the example of open source software, this study examines the effect of opening up the innovation process on the market value of firms. In a sample of 30 software companies in the time span from 1 January 1999 to 30 April 2007, I find that market valuation is strongly influenced by the business model firms choose for their open innovation efforts. The nonexistence of an explicit revenue model is punished by the capital market while firms whose efforts include an explicit revenue model achieve a premium on their stock price, confirming the potential for value-creation of open innovation efforts.