Hi Gerard,
On Mon, Jul 5, 2010 at 10:58 AM, Gerard Meijssen gerard.meijssen@gmail.comwrote:
Hoi, One of the reasons, for many the only reason for giving a\t the annual fundraising drive is exactly to provide money to maintain our infrastructure. Take that away and you take away the reason to give. Once people get it in their mind that we have reserves to pay for our infrastructure, they will remember this and not support us for our other goals.
In my experience, donor motivation is much more complex than that. While the donor survey is still in preparation, anecdotal evidence suggests that donors do not just provide donations to cover our infrastructure but also, for example,
- as a voluntary payment for using Wikipedia - as an act of charity to support education for people not typically provided with decent educational material (i.e. the economically disadvantaged) - as an act of appreciation for the work of thousands of volunteers
Setting up an endowment to cover part of the fixed costs of running the Wikimedia projects is something that IMHO is definitely sellable to donors. Check also the rationales given at the moment for not pursuing an endowment: they are not related to donor motivation but rather to effort required, opportunity cost involved, and funding sources cannibalized.
In general, I think the arguments made against pursuing a general endowment are sound, at least for the moment. For an endowment to be meaningful, it needs to be fairly big. Let's say that we want to cover half of the current year's technology budget (about $1.65 million) and we can expect an annual ROI of 5%. The endowment would have to be at least $33 million to cover that.
That's not an impossible amount to raise, in general, but it's definitely not easy. You would have to spread this out over several years considering that our existing donor base doesn't yield that sort of revenue. So it might take you, let's say, five years to get this together. Now it's 2016 and you've got a $33 million endowment yielding $1.65 million payout. Yet, from all we can tell at the moment, our tech budget won't be anywhere near $3.3 million in 2016 (it's already planned to be $9.8 million in 2011). So what to do?
Personally, I think we should an endowment drive when we've found our donation revenue, but also our operational spending to approximately level off. We are in a period of rapid operational growth, which will end eventually. When that happens, we will have a better understanding of our own actual financial need as well as our worldwide fundraising potential. Until then, let's focus on what has the most benefit at the least cost which, as it turns out for the moment, is community giving.
Best regards,
Sebastian Moleski President Wikimedia Deutschland