thanks for collecting these links, they are interesting. Anyway, I didn't fully understand the idea behind the page, especially as a non-native speaker I have problems to come up with a proper translation / understanding of "Endowment". I understand it as "what WM(F) owns" and it may refer to the "right" WM(F) expects to have on getting / using their donated money or may refer to the reserves WMF is currently building. Can you explain this a bit better for people like me, please? Maybe right on that Meta page would be good, so others can read it as well.

An endowment is a long-term thing. Current low interest rates probably won't last more than a few years. Even so, it would need to be a very large fund, yes. If you can get a return of, say, 2% over inflation (you can get more than that if you're willing to take some risks) you need 50 times your annual budget to fund it all from the endowment. That would be something like $2 billion for the WMF. It doesn't need to fund the entire budget to be useful, though, and can be built up over time (eg. from legacies in people's wills).

My feeling would be that the obvious first place to start would be the Board of Trustees. I'd probably start by emailing them and asking them what they think. It seems to me, if I were in your shoes (and I'm carefully taking no position here, not because I don't have an opinion but because I don't have a considered opinion....), that the response to that would drive the next set of actions.

It costs about $2.5 million to keep the sites operational for a year.

On Thu, Mar 14, 2013 at 10:47 AM, MZMcBride <z(a)mzmcbride.com> wrote: How did you come up with that number?

On Mar 15, 2013 12:21 AM, "MZMcBride" <z(a)mzmcbride.com> wrote: Last year's financial report shows almost exactly $2.5m for "Internet hosting". I'm not sure quite what that covers, but I expect it is all necessary for bare minimum hosting of the sites. There will then be some salaries for the people maintaining the site. Some legal and accounting people. An ED (although not as well paid as Sue, since they would be running a much smaller organisation). Then various operational and administrative costs. My finger in the air estimate would be a total of about $4m-$5m. I think the foundation should include such an estimate in their financial planning. It is important to know how much money is going on essentials and how much on nice-to-haves. (That ought to be how the core/non-core split works, really...)

On Thu, Mar 14, 2013 at 8:45 PM, George Herbert &lt;george.herbert(a)gmail.com&gt; wrote: finger in the much really) I think a useful breakdown is {([<hosting> + core operations] + core projects) + additional projects} = budget The boundaries get fuzzier, moving out. Hosting : Bandwidth and hardware; has two line-items in the budget. Core ops : Everything needed to make hosting work with [reasonable] uptime / disaster response / critical updates. Core projects : Everything needed to make the Projects and Foundation work with [reasonable] efficiency and accessibility. Including fundraising, financial and legal project support, development of major features, mediawiki platform innovation, support for community tech innovation. Additional projects A : Efforts to upgrade "reasonable" service to "excellent". Support for new Projects. Experiments in engagement / collaboration / governance. Additional projects B : Work to bridge gaps in current projects, research to find solutions to unsolved problems, outreach to new audiences. Other exploratory work, e.g., in design / communication / education / dissemination / translation. There are other ways we could classify our work. There are options for in-kind donations or volunteer-run versions of many costs, though this is not always sustainable. There are options for degrading the quality of services rather than dropping them entirely. This classification isn't perfectly tied to long-term importance: it focuses on things we've already done and want to protect. Something supported by an "additional" project today may become a core project tomorrow, or key to the future of the movement... or it may be spun off or handed off to a partner. Last year, our definition of "non-core" WMF projects was I believe similar to group "B" above. SJ _______________________________________________ Wikimedia-l mailing list Wikimedia-l(a)lists.wikimedia.org Unsubscribe: https://lists.wikimedia.org/mailman/listinfo/wikimedia-l

The "what's the level required for bare survival" question is, IMO, only of marginal interest, because it is much more desirable, and should be very much possible, to raise funds for sustaining our mission in perpetuity.

Liam Wyatt, 15/03/2013 02:55: On 15 March 2013 01:51, Erik Moeller &lt;erik(a)wikimedia.org&gt; wrote: I seriously doubt so. Let's not abuse measures and definitions for purposes other than those they were designed for, please. Nemo ______________________________**_________________ Wikimedia-l mailing list Wikimedia-l(a)lists.wikimedia.**org &lt;Wikimedia-l(a)lists.wikimedia.org&gt; Unsubscribe: https://lists.wikimedia.org/**mailman/listinfo/wikimedia-l<https://lists…

On Thu, Mar 14, 2013 at 5:42 PM, Thomas Dalton &lt;thomas.dalton(a)gmail.com&gt; wrote: Only data-center usage (facilities, bandwidth, power). It does not include capital expenditures (servers, storage, network gear, etc.; budgeted at $1.9M in 2012-13) nor ops engineering staffing, nor of course any software engineering staffing or the basics of an organizational support structure (management/administration, legal, etc.). What's a bare minimum amount? It's a hard question to answer, because it depends on what you consider an acceptable bare minimum. - Is it acceptable for the projects to be without legal defense? - Is it acceptable to revert back to a single data center mode of operation? - Is it acceptable for ops to just barely be able to keep the lights on, with minimal effort dedicated to backups/monitoring/maintenance, etc.? - Is it acceptable for there to be no software engineers to aid with reviewing code contributions, and making improvements to the software? and so on. WMF has operated in the past without staffing and with very minimal staffing, so clearly it's _possible_ to host a high traffic website on an absolute shoestring. But I would argue that an endowment, to actually be worthwhile, should aim for a significantly higher base level of minimal annual operating expenses, more in the order of magnitude of $10M+/year, to ensure not only bare survival, but actual sustainability of Wikimedia's mission. The "what's the level required for bare survival" question is, IMO, only of marginal interest, because it is much more desirable, and should be very much possible, to raise funds for sustaining our mission in perpetuity.

On Thu, Mar 14, 2013, Erik Moeller &lt;erik(a)wikimedia.org&gt; wrote: I'm not technically inclined, but those numbers sound odd. Maybe I'm missing something? The traffic ranking didn't go up nearly as substantially in the last couple of years as the hosting and cap-ex mentioned above.

Aside from that, it's only recently that Wikimedia sites have approached having the kind of redundancy and failover capabilities we've talked about needing for a long time. That's at least one example of something that can add pretty significant costs without having a material impact on traffic (except in emergencies, of course).

On Fri, Mar 15, 2013, James Alexander &lt;jamesofur(a)gmail.com&gt; wrote: the They increased a lot, but I don't think they more than doubled, or even doubled[2]. The rise is pretty steady from Feb 09. Regards Theo

I didn't say you used traffic ranking to support your own estimate, you used it to try and rebut the estimates provided by Erik and others. That's still a kind of analysis.

On Thu, Mar 14, 2013 at 2:47 PM, MZMcBride &lt;z(a)mzmcbride.com&gt; wrote: This used to be my pet project for a while. My first edit to strategy wiki was about an endowment fund[1], I don't think there was anything on the subject before that one. Stu and Eugene's edit on the subject came later, so I'll still take some credit for this one. ;) I brought this up in person to a few board members, and to the foundation staff on another mailing list an year or two ago. I believe they are all aware of the idea and its implication. Eugene suggested at some point that we should come back to this discussion later. The answers were always ambiguous from what I recall. There seems to be absence of a long term sustainable financial vision for the foundation, or if there is, it doesn't seem to be public. The majority of it seems to revolve around retaining x months of operational reserves and putting all the chips on the annual fundraiser. I always thought that's not a very mature financial strategy for an organization. I started discussing this on strategy wiki, etc. and the first thought was separating the core and non-core activities, and then separating the funding models. The core activities are relatively stable, the non-core differentiate a lot more year on year - moving the non-core to a variable model where the revenue would define spending, and core activities to its self-contained sustainable model would be an ideal strategy. The bare-minimum operational cost of hosting, and being online, could be covered with such a fund easily, leaving the annual fundraiser target to be a variable each year without any target, which in turn can define the spending. The correct calculation,as thomas started alluding to would be - operating expenses + projected growth (year on year) + annual inflation rate + reserve/contingency. I had a lot more worked out somewhere according to tax laws and specific interest rates. Either way, the first implication would be that this would nullify to some extent, the majority of the urgency the fundraiser raises, the success of the fundraiser would be irrelevant to the long term existence of the projects. Regards Theo [1]http://strategy.wikimedia.org/wiki/Proposal:Wikipedia_Fund _______________________________________________ Wikimedia-l mailing list Wikimedia-l(a)lists.wikimedia.org Unsubscribe: https://lists.wikimedia.org/mailman/listinfo/wikimedia-l

Aha, a welcome topic :) MZMcBride writes: Yes, let us build an endowment. It makes practical sense: As a community institution that aims to serve our society for the next 100 years, it matches our scope and vision. And as a respected and visible global project, we can raise the funds we need. It also makes financial sense: Some donors prefer to donate to one. And there are economies of scale: the flexibility of long-term investments let them generate better average returns, and large funds can invest significantly more effectively than small ones. Anders Wennersten &lt;mail(a)anderswennersten.se&gt; writes: Right. When we first considered an endowment, the WMF didn't have the financial expertise to set one up; later, in 2010, fundraising was growing quite quickly and took priority. Now we are in a good position to plan longer-term investments. This is good timing for another reason as well. These issues were raised at the WMF Audit Committee meeting last week, and the WMF is considering what an endowment might look like. Strong community support would speed that consideration. SJ -- Samuel Klein @metasj w:user:sj +1 617 529 4266 _______________________________________________ Wikimedia-l mailing list Wikimedia-l(a)lists.wikimedia.org Unsubscribe: https://lists.wikimedia.org/mailman/listinfo/wikimedia-l

On Thu, Mar 14, 2013 at 1:47 PM, Lisa Gruwell &lt;lgruwell(a)wikimedia.org we had to also "Legacy (Or Thanks Lisa -- now *that's* a good question :) I added a quick section to the endowment page, if people want to discuss there: https://meta.wikimedia.org/wiki/Endowment#Will_we_be_relevant_in....3F -- phoebe _______________________________________________ Wikimedia-l mailing list Wikimedia-l(a)lists.wikimedia.org Unsubscribe: https://lists.wikimedia.org/mailman/listinfo/wikimedia-l

Parallel to that question, is what happens to the endowment if the WMF is wound up. This would be of some interest to possible donors. In principle I am in favour of an endowment. Cheers, Peter ----- Original Message ----- From: "phoebe ayers" &lt;phoebe.wiki(a)gmail.com&gt; To: "Wikimedia Mailing List" &lt;wikimedia-l(a)lists.wikimedia.org&gt; Sent: Thursday, March 14, 2013 10:52 PM Subject: Re: [Wikimedia-l] Wikimedia (Foundation) endowment _______________________________________________ Wikimedia-l mailing list Wikimedia-l(a)lists.wikimedia.org Unsubscribe: https://lists.wikimedia.org/mailman/listinfo/wikimedia-l

Yes, let us build an endowment. It makes practical sense: As a community institution that aims to serve our society for the next 100 years, it matches our scope and vision. And as a respected and visible global project, we can raise the funds we need.

All that said, I strongly support the idea, on the principle that what we do is important for the long-term and needs to be supported as such. We did discuss the idea during my time on the board, a year or so ago, and it sounds like it's coming up again, which is great!

On 14 March 2013 08:09, Manuel Schneider &lt;manuel.schneider(a)wikimedia.ch&gt; wrote: Hi Manuel, The basic idea of an endowment is that it's a large sum of money collected to "set up" a charity - it then uses the income from investing this money to cover some or all of its operating costs, rather than just spending it over a long period of time. The Wellcome Trust is a pretty good high-profile example; it has a capital endowment of around fifteen billion pounds, and spends about six hundred million (4%) a year. (In the US context, they're very common for universities, but this is less so in Europe; here it's more "traditional charities") I've given a quick outline on the meta page. Building up an endowment sufficient to run WMF would be tricky, of course :-)

Hello dear all, at first thank you very much MZ for put this together. This is a quite hot topic both for the board election, which is coming soon again, and also on the board. The following is my personal opinion why WMF should not build an endowment. The rationale from me are the following three: 1. WMF doesn't need an endowment 2. An endowment poses extra risks and problems for the WMF 3. From some aspect an endowment is contraproductive for the WMF even if we ignore the risks. Let me explain in more detail: 1. WMF does not need an endowment. For most NGO and non-profit organizations, an endowment is a method to mitigate the risk of unconstant income and unsecure funding. With the endowment the organization is indepenmdant on the ever changing fundraising result or on its dependance on grants. The WMF is not facing these problems. The WMF is not dependant on one or few grants, and it is not dependant on some big donations. The fundraising model of the WMF is based on microgrants from hundreds of thousands of participants, and practically from every region of the world. This makes it less vulnerable for example on changing economic situations. This is especially the case since we are not exhausting our fundraising potential (and as I understand the current strategy, we are not planning to exhaust this potential), and we have a fairly good strategic reserve. For the year 2009 for example we were all a bit nervous on our fundraising result since at that time the financial crises began to seriously impack the world economy. But at that year we doubled our fund raising result, achieved our goal before the targetted fund raising deadline. This trend kept for the last few years, independant of the world economy. It proves the robustness of this fundraising model. In comparison to most other non-profit organizations we are in a lucky situation that this model works for us. It certainly does not work for all organizations. And because the model is robust and it works well for us, we should not simply do what everyone else does: try to build up an endowment. If we don't need it, we don't need it. 2. An endowment poses extra risks and problems for the WMF An endowment is a very big bunch of money. And if you have that money somewhere in your safe, it won't be any benefit. You need to invest it so that it get's return. An endowment is actually pretty similar like a bank. And as a bank, you need experts to take care of investment, of risk management, and all other things. Either you need your own experts (actually you always need your own expert at least for overseeing), or you need to buy experts. You need to trust him. Either way it means that you must pay the bill. And, the following is really my very personal and unprofessional opinion: There is no 100% security if you are a bank. Lheman Brothers were rated by all agencies as AAA until it went bancrupt. Even the United States Treasury Security is not as secure as it seemed to be. I trust the hundred thousand people who give us 10 to 100 dollars more than the few experts, when it comes to security. And the work "ethic" investment was already mentioned here in the list. I believe we can debate forever if investment in United States Treasury Security is ethic or not. 3. From some aspect an endowment is contraproductive for the WMF even if we ignore the risks I believe the Wikimedia projects represent a culture: the sharing culture. Even if it is not explicitely stated in our vision and mission, the Wikimedia projects are avant gards of this culture, and they get their strength from this culture. The annual fundraising campaign is one of our most effectful method to propagate this culture, even it is not designed so. I know many people, my colleagues, friends, people who use Wikipedia daily, but never think about how its service is maintained, until the annual fundraising campaign. Often it is at that time when people tell me: "Oh, I just see you are fundraising again, I am happy to make this contribution to show my support." Normally people never say this, until at the end of the year when our fund raising banner is on our project pages. I know for a lot of you the banners are annoying. But I also know that for a lot of people, who are not so involved in our projects, the banner is the reminder of our sharing culture. It is the time when they feel that they need to contribute something, and it definitively make them happy to do so. It makes them to feel also to be part of it. Our annual fund raising campaign is not thought to be a propaganda for the sharing culture, but in effect it is a very effective propaganda for it. And I believe it would be a los for all of us, if we don't have it any more. So far, my thoughts. As I said all my private opinions, and some of them certainly very primitive and unprofessional. I am happy to get feedbacks and critics and learn from them. Greetings Ting Am 14.03.2013 06:48, schrieb MZMcBride: -- Ting Ting's Blog: http://wingphilopp.blogspot.**com/<http://wingphilopp.blogspot.com/> ______________________________**_________________ Wikimedia-l mailing list Wikimedia-l(a)lists.wikimedia.**org &lt;Wikimedia-l(a)lists.wikimedia.org&gt; Unsubscribe: https://lists.wikimedia.org/**mailman/listinfo/wikimedia-l<https://lists…

[...]The only business I know of that relies on something close to 100 years of time horizon for strategy is forestry. [...]

Dariusz Jemielniak, 18/03/2013 10:03: Seriously? What about dams, railways... or nuclear plants? (Just to use extreme examples.) But the point is that we're not a business; good comparisons for endowments are things like universities, libraries, churches, red cross etc. etc. Nemo

I disagree. The "horizon for strategic planning" in the case of business is just making profit, so you can build dams or power plants with a 50 or 100 years timeframe in mind, sell them all ten years later to buy banks or other big factories in a new sector and start again (cf. creation of Enel as told by Paul Ginsborg). That's exactly the opposite of what donors want for an endowment, and the point you're missing in your last reply to his point: it's reasonable to be unable to produce a meaningful long-term strategic plan for the sort of activities and objectives that the WMF has, but not for Wikimedia in general. In fact in <https://meta.wikimedia.org/**wiki/Wikimedia_Trust<https://meta.wikimedia.org/wiki/Wikimedia_Trust>> I defined the aim as *negation* (or rather, the complement) of the 5-years strategic plan; more on the page.

And I still don't see anything in your arguments supporting your theory that "in our case any vision and strategy of a long time horizon is a grave mistake", except the claim that, probably, all the institutions with endowments are more similar to forestry business than to us.

As I have a MBA specializing in international strategy, hand in hand with a couple of decades as a consultant, I would count myself as having a basic understanding. ;-)

Developing a strategy would require some big thinking of scenarios: * Does Wikimedia get subsumed into a new ecology of open knowledge organizations? * Does "operations" become irrelevant as it will be naturally factored out? * In a future of cheap as chips access, does "access" mean socialization and education?

Classically, one might bounce around environmental scenarios such as religious division, hyper-connection social instability (meme threats), population crisis etc.

It's a big talk, and above was mentioned spending 5 years on this. Consider how darn slow us unpaid Wikimedia volunteers are to nit-pick our way forward, thinking of how we take longer than a year+ to reach some conclusions is not unreasonable, and it is not as easy as saying "quote examples" as if this was a discussion short-cut.

On 18 March 2013 12:14, Dariusz Jemielniak &lt;darekj(a)alk.edu.pl&gt; wrote: ... I'm happy to continue calling this part of strategy creation, while you call it speculation or guesswork. However I believe it is perfectly clear that if the movement has no 100 year plan, even in concept, and cannot set some top level goals to show our commitment to a century long view, then a public call to create a billion dollar endowment will quickly be shot down as banking money for the sake of job security. An easy-peasy goal is to ensure all project knowledge content is actively archived in a way that the commitment to preservation is meaningfully demonstrated. Pointing to a reasonably future-proofed but cost effective 100-year (multi-location) archive is one obvious way of explaining what an endowment is for. PS I have heard the archive question answered recently by a representative of the WMF on a radio interview as "Oh, it's all over the internet, if we disappear it could always be re-created" (or words to that effect) - I thought this a particularly naff answer for an organization with many millions in the bank to spend on operational risks. Thanks, Fae -- faewik(a)gmail.com http://j.mp/faewm Guide to email tags: http://j.mp/mfae

On 18 March 2013 13:24, Dariusz Jemielniak &lt;darekj(a)alk.edu.pl&gt; wrote: Google it - some random reading: * 100 year project http://www.dailymail.co.uk/sciencetech/article-2199247/The-100-year-Starshi… * 100 year plan http://www.nutraingredients-usa.com/Industry/Unigen-pens-100-year-plan * 100 year plan http://www.cnv.org/server.aspx?c=3&i=541 * 100 year scenario planning http://www.computerweekly.com/opinion/Technology-in-the-next-100-years-the-… * How Google and Virgin wanted to be on Mars in 100 years http://www.google.com/virgle/plan_1.html :-D A business search might discover some more down to earth long term strategy examples. If this gets a bit more serious, I might spend a couple of hours in the British Library business center tracking some down. Cheers, Fae -- faewik(a)gmail.com http://j.mp/faewm Guide to email tags: http://j.mp/mfae

On 18 March 2013 13:18, Fae &lt;faewik(a)gmail.com&gt; wrote: That's not quite right ... * we need to make sure there are actually multiple accessible copies of the huge database dump files around * someone needs to take one of these and recreate a working, editable copy of (say) en:wp, with all text and images * if that fails in any regard whatsoever, it's something that really needs fixing This is largely a matter for ops, of course. But someone needs to get a spare PC with a huge amount of disk and try it ... (Why not me? Time/arsedness/lack of said PC and huge disk.) - d. _______________________________________________ Wikimedia-l mailing list Wikimedia-l(a)lists.wikimedia.org Unsubscribe: https://lists.wikimedia.org/mailman/listinfo/wikimedia-l

On 18 March 2013 13:39, Thomas Morton &lt;morton.thomas(a)googlemail.com&gt; wrote: Yes, that's the precise thing I'm saying needs proper testing :-) My threat model here is if WMF vanishes one day, say it's hit by a meteor (including legal meteors). - d. _______________________________________________ Wikimedia-l mailing list Wikimedia-l(a)lists.wikimedia.org Unsubscribe: https://lists.wikimedia.org/mailman/listinfo/wikimedia-l

To return to the endowment again as the main topic, I think there are some risks we need to consider in an endowment. In general I think having an endowment is a good idea for a charitable institution, and certainly the WMF needs a strategic reserve of some size to maintain operations in the event of a crisis. But a lot of thought has to go into the target size of that fund, the nature of its fundraising, how or whether it is used, and what role (and of what prominence) it plays in WM/WMF public relations. [...]

On Mon, Mar 18, 2013 at 12:53 PM, MZMcBride &lt;z(a)mzmcbride.com&gt; wrote: Yes and yes. like More information is certainly needed. It is bound up in other strategic thinking, as others have noted. I think we should set up a strategy committee, with a subgroup focused on an endowment and long-term investment options. SJ _______________________________________________ Wikimedia-l mailing list Wikimedia-l(a)lists.wikimedia.org Unsubscribe: https://lists.wikimedia.org/mailman/listinfo/wikimedia-l

I suggest you step away from the technology component before this becomes a mantra. Given a span of 100 years, assumptions become rather large. We can start to assume that within one or two decades, *everyone* on the planet is data-connected, we can assume that language barriers break down or become irrelevant, we can assume that connection and hardware costs become vanishingly small and we can assume that engagement with human knowledge is fully immersive.

Developing a strategy would require some big thinking of scenarios: * Does Wikimedia get subsumed into a new ecology of open knowledge organizations? * Does "operations" become irrelevant as it will be naturally factored out? * In a future of cheap as chips access, does "access" mean socialization and education? Classically, one might bounce around environmental scenarios such as religious division, hyper-connection social instability (meme threats), population crisis etc. It's a big talk, and above was mentioned spending 5 years on this. Consider how darn slow us unpaid Wikimedia volunteers are to nit-pick our way forward, thinking of how we take longer than a year+ to reach some conclusions is not unreasonable, and it is not as easy as saying "quote examples" as if this was a discussion short-cut.

The "sum of human knowledge" is not about internet technology of the moment, or limited to the next 5 years.

If the WMF and the leading figures in our movement cannot produce a vision or even a highest possible level strategy for 100 years, then the case for having a billion dollar endowment looks exceedingly weak and probably idle dreaming.

There is no sensible case for an endowment fund that only imagines the next couple of years - that is in fact why we talk about reserve funds that cover that period and short term risks that might arise.

knowledge, I would want the comfort of knowing the organization that will use my money will exist *long* after my death, it will not "repurpose" funds in unexpected ways, or waste it on an empire building bureaucracy that has the natural priority of paying benefits to careerist senior management types involved in operations.