Study Reveals Wikimedia Foundation Is 'Awash In Money'

New submitter Harold Dumbacher writes: Few things seen on Wikipedia aggravate its users more than the annual fundraising banners. Yet millions of people continue to contribute, seeming to think that Wikipedia will "go offline" if they aren't given more donations. Yet as a new Wikipediocracy blog post reveals, the Wikimedia Foundation is rolling in dough — $53 million in net assets as of this year (that's actual hard sitting-around currency, currently put into various investment vehicles). Meanwhile it only costs about $2.5 million to actually keep Wikimedia project servers online and handling user traffic. The rest of the WMF's annual donations go for "staff salaries, travel and miscellaneous." And evidently, many people are growing disgruntled with this ongoing state of affairs, even Wikimedia staff who benefit from it.

Comments

Investments?

[jythie]

Wait, so is this liquid cash or invested money? This is a rather important distinction since non-profits often depend heavily on interest from investments as their primary stable source of income. So if this is the later case, it sounds like responsible stewardship, at least that piece of it since I gather the amature nature of administration shows through in other areas.

Re:Investments?

[AthanasiusKircher]

This is a rather important distinction since non-profits often depend heavily on interest from investments as their primary stable source of income. So if this is the later case, it sounds like responsible stewardship

While it's possible that this is the case, I believe the objection here may be to the way that Wikipedia is advertising its fundraising drives.

It's one thing to say "Please donate to us so we can have a suitable sustainable endowment to keep this website running forever" and it's a different thing to say "Please donate now, or this site might go down imminently because we can't pay our bills."

According to an older story at Wikipediocracy, the objections seem to be partly that fundraising campaigns are expressed in a dire "We need money now or the lights go off!" kind of tone, when that really isn't the situation.

The first goal of raising an endowment is certainly a laudable one for any sustainable non-profit. The question is whether they're being honest with their donors about what their situation is and what they are going to do with the money.

Re:So?

[pla]

Yes, they most certainly do. Every nonprofit on the planet has the long-term goal of having an endowment large enough that they can focus on their core mission rather than bullshit fundraising drives. In order to do that sustainably, they need to have an endowment approximately 25x their annual operating budget, plain and simple.

Nonprofits still function as corporate entities that need to pay the bills, they just don't have - as you might infer from their name - "profit" as their primary mission.

I have my objections to Wiki's policies (primarily editorial), but the fact that they have targeted a self-sustaining endowment, I don't fault them for - Quite the opposite, I give them credit for actually having a viable business plan. Yes, "business plan" - Nonprofits still need one of those, like it or not.

Re:Should add this to Wikipedia

[drinkypoo]

If any particular charity's overhead bugs you...go find another charity, or start your own. There will never be shortage of needs.

Or share the information with others to raise awareness so they don't spend their money where it won't help. Like this story.

Re:So?

[AthanasiusKircher]

I have my objections to Wiki's policies (primarily editorial), but the fact that they have targeted a self-sustaining endowment, I don't fault them for - Quite the opposite, I give them credit for actually having a viable business plan.

I completely agree with your sentiment here. But the question is not whether that's a good business plan, but rather whether those who have donate that money actually realize they are giving money to support an endowment and a bunch of ancillary services and staff, rather than barely keeping the site "going for another year."

See last year's fundraising message:

DEAR WIKIPEDIA READERS: This week we ask our readers to help us. To protect our independence, we'll never run ads. We survive on donations averaging about $15. Now is the time we ask. If everyone reading this right now gave $3, our fundraiser would be done within an hour. Yep, that's about the price of buying a programmer a coffee. We're a small non-profit with costs of a top website: servers, staff and programs. Wikipedia is something special. It is like a library or a public park where we can all go to think and learn. If Wikipedia is useful to you, take one minute to keep it online and ad-free another year. Thank you.

When you include words and phrases like we survive, small non-profit with costs of a top website: servers..., keep it online... another year, etc., it implies that (1) you're barely making it by ("survive"), (2) the majority of your "small non-profit" funds must be going directly into infrastructure when they're not, and (3) if you don't donate now, we may not be able to go on for "another year."

All of that is misleading. At no point do they appeal to an idea that they are trying to build a sustainable long-term endowment or something. I'm sure some people would donate to that too. But right now their rhetoric doesn't match their financial situation or goals... and that's a serious problem when you're trying to convince people to donate.

(And there's also the problem that most people don't realize that the Wikimedia foundation contributes almost nothing toward maintaining, improving, or policing the content that people actually visit the site for -- all the real work for the actual content is generated by volunteers.)