Financing freedom section1.02

transcript

How to organize and fund free culture projects

Kevin ShockeyFounder, Mis Tribus

Free culture projects often fail due to a lack of resources.

So What?

By focusing on raising funds,a project can increase its' chances

of survival

Why me?

Freedom is not free!(How many ways can you relate?)

Why now?● Declining interest in FLOSS● Lack of unity, more division● FLOSS success is taken for granted● Increased willingness to compromise● Lingering confusion surrounding free software

Disclaimer

I'm not pretending to tell anyone what to do,I'm sharing my interpretation.

My story.(Your mileage may vary...)

So far...● Funding Free Culture:

● Blog: FundingFreeCulture.MisTribus.com● blog.financingfreedom.com● @ffc_2012● Tumblr: FundingFreeCulture.Tumblr.com

● One Blogger post triggers:● 3 Automated tweets on 3 different accounts● Updated Linked In● Updated Finding Free Culture Page on Facebook

Assumptions● Free Culture● Project Execution● Project Funding

Free Culture Assumptions● Free culture projects often fail● People assume FLOSS's success is

guaranteed● Division makes free culture weaker

State of FLOSS?● Four stages of Maturity:

● Emergent● Growth● Mature● Declining

● Projects in emergent, growth, & maturity stages

State of FLOSS is mixed● Enterprise recognition● Limited user recognition/support● Participation is declining● Finances (resources) are limited (often to just

one person)

Top 10 FLOSS Hall of Fame

1. Linux Kernel2. GNU Utilities & Compilers3. Ubuntu4. BSD5. Samba

(Top 10 Open Source Hall of Famers. (2009). http://mstrb.us/zjn6zK)

Top 10 FLOSS Hall of Fame

6. MySQL7. BIND8. SendMail9. OpenSSH & OpenSSL10. Apache

Measuring FLOSS● Through search, Google Trends● Through search, Google Scholar● Through investigation, Mining SourceForge.net

Repository

Search is relative● Search is a simulation;

● By measuring “reality” we affect reality● It is a proxy,

– We humanely can not understand the math involved– Artificial intelligence

What SEO Tells Us

General trends for mature projects

What SEO Tells Us

General trends for emerging projects

What SEO Tells Us

Academic Publications● Collected in Google Scholar Advanced Search● Parameters

● “Open Source” exact phrase all in title● “Engineering, Computer Science, and Mathematics”

subject area● Year to Year (eg; 2012 to 2012, 2011 to 2011, etc.)

Open Source Academic Papers by Year

2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 19970

Direct Results

“Open Source” vs “Free Software”

2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 1995 1994 1993 1992 1991 1990 1989 1988 1987 1986 1985 1984 19830

Open Source Results

Free Softw are Results

Academic Paper Analysis● There is a possible peak, and downward trend

for “open source”● Free software has not been researched much

● Out-published by a margin of 5 to 1 by open source.

Academic Paper Questions● Has research on “open source peaked?● Why isn't anyone researching “free software?”● Has “open source” obscured the importance of

free software?

What Else?● Niche groups who are content with scratching

their own itch● Dogmatic approach to community

● Financial support (donations, purchases, memberships) is lacking

● Large difference between public relationship strategies● Most successful projects use modern strategies

Project Execution Assumptions● Organizing a FLOSS project has changed.● FLOSS projects are similar to startups● Execution is achieved through testing

assumptions

Project Funding Assumptions● Our software (product) is sufficient to obtain

resources● There is an over abundance of data

● Varying levels of “information”● Increasingly interact with more artificially

intelligent systems

State of FLOSS● Build Measure Learn or Your Competition Will

● Irrelevance is your enemy● Free Beer will NOT fuel your projects

● In need of unity of purpose ● In favor of software freedoms● In favor of asking for help

Build Measure Learn

Free LOSS

Freedom is not free!

Fund-raising Alternatives● Grants● Seed Funding● Donations● Merchandise

Finding Resources● Crowd-Sourced

Top Ten Fund-raising Lies

1.All we have to do is get 1% of the market2.We filed patents so out intellectual property is

protected3.Our management team is proven4.The large companies in our market are too big,

dumb, and slow to compete with us5.Our product will go viral

Top Ten Fund-raising Lies

6.Hurry up because our other investors are about to do our deal

7.No one else can do what we're doing8.Several Fortune 500 companies are set to do

business with us9.Jupiter says our marker will be worth $50 billion

in ten years10.Our projections are conservative(Kawasaki, 2012)

Modeling

If we do not know who the customer is,we do not know what quality is.(Ries, 2011)

Questioning Assumptions

“What if they don’t care about [fill in the blank]in the same way we do?”(Ries, 2011)

Questioning Assumptions

“In fact, piercing the reality distortion fieldis quite uncomfortable. ”(Ries, 2011)

SourceForge Projects● 324,000 projects● 268,554 projects with only 1 developer (83%)● 44,446 “viable” projects (14%)

Successful Free Culture Project

When it's community is more than

just the author of the project

Developers Per Project

Why Do People Give?

1.Belief in the cause2.Recognition and

honor3.For a tax deduction4.Family tradition5.Religious beliefs

6.Joy7.Guilt8.Fear9.To make a difference

Thought Experiment● Put the following non-profits in order of size of

assets (donations):● Apache Foundation● Free Software Foundation● GNOME Foundation● Mozilla Foundation● Perl Foundation● Wikipedia Foundation

Case Study: Free Software Foundation

Case Study: GNOME Foundation

Case Study: Apache Foundation

Case Study: Mozilla Foundation

Mozilla vs overall FLOSS Browsers

Case Study: FSF Foundation

Fund-raising Best Practices● Ask● Prepare● Measure● Repeat

Best Practices for Startups

Best Practices for Politicians

A good design is one that changes customer behavior

for the better.(Ries, 2011)

Fund-raising 101● Build a Foundation● 501(3)c● Grants● Corporate Donors● Community

Build a Foundation● Incorporation● Mission/Vision● Board of Directors● Transparency

Setting up a 501(3)c

Finding Grants

Corporate Donors● Pitch● Outbound Marketing●

Community● Building a Community● Using Social Media● Build-Measure-Learn

References● Kawasaki, G. (2012). Raising Money: What Not to Say and

What Not to Believe. http://mstrb.us/zfhxIl● Dvorak, J.C. (2009). The State of Open Source on Firefox's

Fifth Birthday. http://mstrb.us/yF7CF3● Ries, E. (2011). The Lean Startup.● Fiscal Year 2010-2011 Annual Report for The Apache Software

Foundation. http://mstrb.us/AzdrN2● Fiscal Year 2009-2010 Annual Report for The Apache Software

Foundation. http://mstrb.us/yLiEIy● Fiscal Year 2008-2009 Annual Report for The Apache Software

Foundation. http://mstrb.us/x8VKbv

References● Fiscal Year 2007-2008 Annual Report for The Apache Software

Foundation. http://mstrb.us/xvGSe4● Fiscal Year 2006-2007 Annual Report for The Apache Software

Foundation. http://mstrb.us/y63WzT● Fiscal Year 2005-2006 Annual Report for The Apache Software

Foundation. http://mstrb.us/yNAbTE● Fiscal Year 2002-2003 Annual Report for The Apache Software

Foundation. http://mstrb.us/wyCvAe● Fiscal Year 2001-2002 Annual Report for The Apache Software

Foundation. http://mstrb.us/wRRw6w● 2010 IRS Form 990 for the Mozilla Foundation.

http://mstrb.us/yLAmX7

References● 2009 IRS Form 990 for the Mozilla Foundation.

http://mstrb.us/yOyW0n● 2008 IRS Form 990 for the Mozilla Foundation.

http://mstrb.us/xLdf1Y● 2007 IRS Form 990 for the Mozilla Foundation.

http://mstrb.us/xP1jqj● 2006 IRS Form 990 for the Mozilla Foundation.

http://mstrb.us/wDJDOV● 2005 IRS Form 990 for the Mozilla Foundation.

http://mstrb.us/yzTktK● 2004 IRS Form 990 for the Mozilla Foundation.

http://mstrb.us/zMnI1u

References

● 2003 IRS Form 990 for the Mozilla Foundation. http://mstrb.us/wDpQeo

● Perens, B. (2008). State of Open Source Message: A New Decade For Open Source. http://mstrb.us/zre7oP

● Perens, B. (2005). The Emerging Economic Paradigm of Open Source. http://mstrb.us/xVlTXC

● Perens, B. The Covenant - A New Approach to Open Source Cooperation. http://mstrb.us/ybrmfO

● FSF 2011 Audited Financial Statement. http://mstrb.us/zCy7VT

References

● FSF 2010 filing information. http://mstrb.us/x2Rumq● FSF 2009 Audited Financial Statement. http://mstrb.us/zyoFHX

● FSF 2008 filing information.

http://mstrb.us/xtBZi1● FSF 2007 filing information.

http://mstrb.us/zbSp0Q● FSF 2006 filing information.

http://mstrb.us/xzNEzS● FSF 2006 filing information. http://mstrb.us/yTjZuR

References● FSF 2005 filing information. http://mstrb.us/xCUQeQ● FSF 2004 filing information.http://mstrb.us/zwOlhl ● GNOME Foundation Detailed Financial Plan 2011.

http://mstrb.us/zxoI4N● GNOME Foundation Detailed Financial Plan 2010.

http://mstrb.us/A0jA2g● GNOME Budget 2009. http://mstrb.us/zdFT0B● GNOME Foundation Financial Statement for Fiscal Year 2007.

http://mstrb.us/Aw7sGN

References● GNOME Foundation – Fiscal Year 2005 – Balance Summary.

http://mstrb.us/wP8h59● GNOME Foundation Financial Statement for Fiscal Year 2004.

http://mstrb.us/wxQVGB● GNOME Foundation Financial Statement for Fiscal Year 2003.

http://mstrb.us/xoFnzh● Sourceforge.net. (2012). Developer Counts – The Stats.

http://mstrb.us/xmAWfu● Browser Market Share. (2009). http://mstrb.us/znr3Iy● Wheeler., D. (2007). Why Open Source Software / Free

Software (OSS/FS, FLOSS, or FOSS)? Look at the Numbers! http://mstrb.us/xBkuQP

● Browser Market Share. (2111). http://mstrb.us/znr3Iy

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