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by toomuchtodo
2729 days ago
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The concern I have is that these vital non-profits (one might say critical infrastructure, depending on the org) have to go hat in hand to the community each and every year for their operating funds, whereas if they had an endowment or some other investment account backing them, they'd be able to survive in perpetuity. At a 4% withdrawal rate, Let's Encrypt would need $100 million invested to not need to ask for funds in the future (assuming they don't drastically increase their operating expenses). Governance and oversight is mandatory though; Wikipedia has net assets almost near $113 million [1] and requires less than 600 servers to operate (plus colo costs, connectivity, technical staff, etc). On the other end of the spectrum, OpenStreetMap costs $118k a year to operate [2]. [1] https://en.wikipedia.org/wiki/Wikimedia_Foundation [2] https://twitter.com/floledermann/status/1057254329290235907 |
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There's a strong argument that entities like Wikipedia having to constantly go back to the community trough to survive, assists in keeping them well behaved. I prefer to keep Wikipedia begging and slightly desperate, rather than obese, detached, entitled, crusty and overly bureaucratic.
The user community that funds them can kill them off through funding deprivation in a short amount of time if Wikipedia decided to become a scumbag. Their annual cost to operate has perpetually increased, it's closing in on $100 million now (three or four more fiscal years at the rate they've been increasing it). They wouldn't survive long without the donations flowing in every year. They could plausibly make a large deal with eg Google on advertising if the user funding dried up due to bad behavior, however that would just be more likely to accelerate their implosion.
It's dangerous to the mission of a charity / non-profit to hand it a position of certain financial perpetuity. All organizations are very much susceptible to bureaucratic creep and wandering off mission in such situations. It's why many of the great philanthropists (Buffett, Gates and Carnegie to name a few) have sought to expend their fortunes relatively rapidly in charity rather than have the charitable trove exist in perpetuity via a perma-institution for parasites to attach to over many decades.