Hi Ad,
That is of course one side of the medal. And yes, lets be grateful for the donations we receive day in, day out from our donors.
But 'getting big' is maybe not the most important thing in the world. Working on our mission, is. And part of that, is security. The WMF is not in this world to play the odds, but rather to ensure that knowledge is freed, and stays free - most specifically by securing Wikipedia's continued availability (at least, that is what our deck of cards looks like now).
Fully focussing on one sigle stream of money may indeed allow you to get more out of it. But the question here is rather, how to you tackle the situation when that stream dries up? And for that question, diversification is actually key.
There is something called the 'law of the diminishing returns' - which I also believe to hold true for Wikimedia. It's not like every increase in our budgets equally increases our mission value. When I'd have to guess, I'd say that we're beyond our 'optimal size' (budget wise) already.
Especially the 'small donor' stream is rather sensitive towards tides. As long as Wikipedia is very popular and visible, we'll be doing well. But when we have a few more screwups at the WMF (sorry, but I can't really find a better phrase for the past few months, communication wise at least), being a credible organisation towards donors might proove harder than was the case so far.
Thát is why we should diversify. Not to grow bigger, but to be somewhat safe.
Best, Lodewijk
On Tue, Feb 2, 2016 at 9:05 PM, Ad Huikeshoven ad@wikimedia.nl wrote:
Hi Scot,
You wrote:
Sue explained to me that the goal was to have WMF's budget be roughly 50%
grants and 50% user contributions to guard against unexpected fragility with either of these funding sources.
[...]
This was Sue's explanation. I don't know if this is still the explicit thinking of the current board/ED, but IMO it's still an entirely
reasonable
rationale for pursuing grant funding, even if the grants come with more "strings attached" than a banner campaign.
You raise a valid question: how many sources of funding does the Wikimedia Foundation need? The Bridgespan Group is a consultancy firm specialized in non-profits. They have been hired in the past by the Wikimedia Foundtion, for example in the period of strategy formation that led to the 2012-2015 Wikimedia strategy.
The Bridgespan Group has done extensive research in funding models. One of their researches in this area has lead to a publication in Spring 2007 "How Nonprofits Get Really Big." [1] You might spell that publication word by word. At the bottom you find a link.
One of the parts in that report is titled "The Myth of Diversification." That title speaks for itself. The finding of the Bridgespan Group is that ''most of the organizations that have gotten really big [...] did so by concentrating on one type of funding source."
The banner fundraising campaigns by the Wikimedia Foundation are a perfectly mission aligned funding model for a non-profit. Somebody else might view the Wikimedia Foundation funding model as pay-as-you-want. [2] Some readers do and most readers do not donate a couple of bucks. However, that "Some readers" amounts to several million people who just love Wikipedia.
Please note that the Wikimedia Foundation was a "small" foundation back in 2007 when the Bridgespan Group conducted their research. The Wikimedia Foundation was not included in the list of 144 nonprofits, all founded after 1969, who were earning at least $50 million per year by 2003. Would the research be repeated today, the Wikimedia Foundation would end up in the top half of that list, and be a prime example of getting big as a non profit by concentrating on a single mission aligned funding source.
Regards,
Ad
[1] http://ssir.org/images/articles/2007SP_feature_fosterfine.pdf [2] https://en.wikipedia.org/wiki/Pay_what_you_want _______________________________________________ Wikimedia-l mailing list, guidelines at: https://meta.wikimedia.org/wiki/Mailing_lists/Guidelines New messages to: Wikimedia-l@lists.wikimedia.org Unsubscribe: https://lists.wikimedia.org/mailman/listinfo/wikimedia-l, mailto:wikimedia-l-request@lists.wikimedia.org?subject=unsubscribe