When to commercialize a product?

I am a young university student with a good number of years experience in both small/large software companies. This has put me in a good position to find strong student developers and lead/consult for team projects.

Recently, I started a promising project and took on some very talented volunteer developers far earlier than I would have done if it were commercial from the start. Originally, I had little intentions of going commercial, but I wanted to leave it as an option (and I made this clear to the team a few times - no concerns/objections were expressed). Now, based on expressed interest, I am now sure that I want to take it that route.

My gut instinct tells me I should do this ASAP and pay contributors a salary (which I'm all set up to do immediately) or there will be problems in the long run. However, I can't (and shouldn't) keep the same team size in that event (a team of 6 would immediately shrink to 2-3). Also, priorities would likely shift to gain earlier profits. Together, these would hamper the project's progress.

Right now, there are no problems. No one is asking for anything, I have the final say on all decisions, and I am taking all losses in terms of resources. I'm just worried that continuing this way is just asking for problems later. I want to be completely ethical/fair and as the product gains success contributors will be rewarded (but I have not mentioned this).

When should I make the switch? If ASAP, how can I smooth the shrink/transition?

Note: I have no problem sharing equity, I just don't want to be forced to do so in an unpredictable way later. Also, most contributors have shown little interest in equity (no entrepreneurial qualities and it doesn't help pay the bills).

It seems that you should be building this either to open source it for free (which is maybe what the volunteers currently think?) or to build it into a business.

I would probably get everyone to sign some type of agreement that what they write belongs to you ... and be up front that you are going to turn this into a business and if it works out you will be able to hire them (or whatever)

But get your paperwork in order if you are having people code parts of your product.

In your current situation in the US I think by default copyright falls to the creator/developer... not you.

You seem to be in perfect position to make a product, you may pay salaries as well make these people to perform other tasks related to the business, and assign them more/other responsibilities too, and be more professional, so this way you can make business.