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> Pretty sure this article could have been called "Wikipedia's Costs Growing Unsustainably" instead of the clickbait headline.

That's not what I got at all. And that's why the article is interesting.

Wikipedia's funding is what's growing unsustainably. It's higher funding that's pushing the costs higher. And that's what makes it interesting (and only a little click-baity.)

It seems, having taken people's money for a charity, you have a moral obligation to spend the money on the charity, whether it needs it or not. And as a manager of said charity, it's very easy to believe (or to convince yourself) it needs the money. Or otherwise why were we making plaintive pleas for money?

(And that happens in a world of good intentions. When fundraisers become cynical, you end up with the US political outrage machine, which operates simply to raise money rather than to effect political change....)




Huh?

From the OP: "After we burn through our reserves, it seems likely that the next step for the WMF will be going into debt to support continued runaway spending, followed by bankruptcy."

If it was just about wasting donations, they'd never go into debt. It's costs, and specifically costs-to-income ratio he seems perturbed about.


From the table in the OP, reserves have gone up every year.

The point isn't that the donations are wasted, its that in spending them, you create an organism that needs to be fed.


In most non-profit organizations, costs never go down. Once a budget is set for programs, staffing, etc, they don't just go away and in fact, they often continue to grow without bound. See any government budget ever for evidence.

So if donations don't continue to grow to match or at least keep pace, they could start running a deficit to eat away those reserves in no time. And once a non-profit organization starts running at a deficit, some contributors will question their contributions and they may shrink accordingly.

Those reserves could disappear in just a few years.. unless there's a change, two years should show the direction and another couple years, the course will be set one way or another.


> In most non-profit organizations, costs never go down.

And your evidence for this is...?

I've worked in the nonprofit space for 10 years and leaders, like for-profit companies, cut costs when they're facing a deficit.

If costs go up at WMF they'll either raise revenue or cut somewhere, like virtually any other mature business.


> like virtually any other mature business

That's the problem. A non=profit is not a "mature business" because it's not a business at all. In fact, in most non-profits any effort to "run it like a business" will be met with opposition. Once again, for evidence look at any government agency, budget, etc.

But even if it was a "mature business" the idea that any organization knows when and how to cut costs after its past its prime is dubious at best. For evidence, look at any company bankruptcy. Their costs outpaced their revenue and they didn't react fast enough or in the right ways.

And that's assuming there were "right ways" to react.


It's a Non Profit Corporation - it is a business, but a business who's job is not to return value to shareholders, but to server the public good.

As far as cutting costs and institutional maturity: sure, your all look at any company bankruptcy. You can also look at the millions and millions of non-bankrupt companies, and realize that you're overgeneralizing.


Once again, I'm talking about the time after a company starts to lose.. and the time it takes them to "correct" if there is a "correct" path.

Or as the top commenter put it "the institutional imperative" - https://news.ycombinator.com/item?id=14287430 - as described by Warren Buffet.


>but a business who's job is not to return value to shareholders, but to server the public good.

Is this some kind of Freudian slip?


No, it was a typo.


> And once a non-profit organization starts running at a deficit, some contributors will question their contributions and they may shrink accordingly.

That's backwards though. It's not unusual for a non-profit to run a deficit. A donor will question a non-profit that's running a surplus - why am I giving you money you don't need.


How many people that give to charities look at their balance sheets before hand?


Most don't as long as everyone is getting paid, the galas and events continue, and outward appearances are fine.

Once invoices or paychecks are delayed, people stop and question why the leadership is "making so much money" and the ROI on galas and events. And once a few donors see the deficits, the questions get harder and money slows down.. making the next round of invoices a little harder.


Apparently not in the case of WMF.


> If it was just about wasting donations, they'd never go into debt.

But there's no debt. The whole argument is pure conjecture based on imagination. Using it as if it were a fact that proves something makes little sense.


The author imagines that the funding will not grow forever. That's almost a certainty, as the article describes carefully.


While it's a good warning to WMF, it's not currently a problem. With longevity, they are in for some large endowments. I think those giving a certain amount (?) should have a vote on various directions of the org, like shareholders but, for the common good that supports their mission statements, instead of shareholder value.

Edit: Punctuation.


> While it's a good warning to WMF, it's not currently a problem.

I believe the author's thesis is that by the time "it's not currently a problem" is no longer an argument that makes sense, it will also no longer be possible to effectively correct the WMF's course in a way that will solve it.

I'm not sure I have any idea how to effectively determine if the author is correct about that, but certainly I don't think "it's not currently a problem" actually contradicts anything he's saying.


Ecxept for the correction that it is the authors unsupported assertion, not any actually argued thesis, I think you summarized it nicely.


Funding will not grow forever, neither would expense. There's no danger it would consume whole world's GDP and would require us to acquire an intergalactic loan from Arcturian Galactic Bank. https://www.xkcd.com/605/


> If it was just about wasting money people give you, you'd never go into debt.

The point is that costs will continue to rise (or not fall) after the funding inevitably falls (or fails to rise enough)


He's expected a future where the growth in fundraising declines, but the costs they have committed to are unable to decline at the same rate.




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