[Wikimedia-l] Setting up a Wikimedia Trust (was: Endowment)

Federico Leva (Nemo) nemowiki at gmail.com
Fri Mar 15 14:14:24 UTC 2013

Creating a new thread because the other is apparently running in circles 

phoebe ayers, 14/03/2013 21:38:
 > Yes. In an university context, which is what I'm most familiar with (and
 > where endowments are very common in the U.S.), there is often a specific
 > "endowment campaign" to plan for and build the endowment that is separate
 > from normal fundraising -- for instance, you might have a dedicated team
 > that would work on the endowment, solicit wealthy donors, etc.

Thanks for this, you reminded me that I sometimes should try to put at 
profit some 12 months spent writing the bylaws of the most important 
university of Italy (by LERU standards). :p

(Some) universities can have endowments because they are multi-centuries 
insitutions with stable stuff to do and because they're deeply rooted in 
their territory (be it a country or a region or whatever).[1] On the 
other hand, they often have to set up different structures for more 
ephemeral tasks, so they may own foundations or for-profits.[2]

The WMF has the opposite problem than a university, i.e. it's busy with 
mostly short-term goals (few years) and that's most of its budget, 
because Wikimedia projects are innovation and without that they die etc. 
So why not use the same approach, just reversed? Make a spin-off for the 
long-term purposes that are currently not covered anywhere. For once I 
did an attempt at being a bit imaginative, consider it just a thought 
experiment if you wish:


[1] Harvard, for instance, is a special case because it aims at being 
not only the best USA university but the center for the best minds of 
the world, so "the world's university".
[2] Big donors and investors want to see some effect for their donation 
(that ideally is not selfish). For instance, if I'm a rich widow with, 
say, 50 million € to give away in my will, I may choose to donate to a 
university because it's important and all, but if it goes to the general 
budget I don't want the money to be consumed by usual operating 
expenditure (especially wages) where it would be a drop in the ocean, so 
I may set some very strict requirements... that however are very 
19th-century-sounding and end up making the money impossible to use, so 
that it will just rot on some bank account (true story).

 > And in turn, the endowment is not meant to fund all expenses or to 
 > normal fundraising. It can fund some expenses, and provides long-term
 > stability for the organization. Endowments often come about when you 
 > have a very wealthy donor who is setting up a foundation, or when you 
 > a humanitarian institution that wants to be in business essentially 
 > (as is the case with most universities).
 > There is complicated law and best practice around endowments that I don't
 > pretend to understand. I do know it's more complicated than setting up a
 > bank account and calling it the endowment fund, at least to do it well.
 > Having an endowment would ideally be a part of the WMF's strategic and
 > long-term financial plan, with some dedicated resources (i.e. staff 
time to
 > manage the fund and solicit donations) applied to it. And we would 
want to
 > be clear on what we wanted the endowment to do -- what its role would be
 > over time -- and how it would interact and perhaps affect annual
 > fundraising.
 > 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!
 > -- phoebe

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