Foundations 101 tutorial: Should I create a new non-profit?

1. Foundations 101
Should you start a new non-profit?
Moderator: Dave Neary
dneary@redhat.com

2. Panel discussion
● Dave Neary
– COSM, Yorba, GNOME Foundation
● Ian Skerrett
– Eclipse Foundation
● Bradley Kuhn
– Software Freedom Conservancy
● Cedric Thomas
– OW2

3. Answer: It depends.

4. Reasons for starting
● Opening a bank account
● Accepting donations (potentially tax-
deductible)
1. Financial infrastructure

5. Reasons for starting
● Enter into contracts (eg. conference venues,
sponsors)
● Hire staff
2. Insulate members from liability

6. Reasons for starting
● Legal safe haven for copyrights and trademark
● Formalize rules for governance of project
● Protect members from individual legal action
● Provide level playing field for members,
structure to pool resources
3. Governance and pooling resources

7. Costs
● Lawyer for drafting of by-laws and annual
registration of company paperwork
● Accountant to deal with taxes, payroll
1. Money

8. Costs
● Registering an organization, drafting by-laws,
official paperwork
● Elections, board meetings, ...
● 501(c)* approval times measured in years
2. Time

9. Costs
● President and board are accountable for the
organization fiscally & legally
● Fiduciary responsibility, potentially outside
your jurisdiction
3. Risk & responsibility

10. Alternatives
● Eclipse Foundation
● Software Freedom Conservancy
● Software in the Public Interest
● OuterCurve Foundation
● OW2
● Linux Foundation
1. Umbrella organizations (in no particular
order)

11. Alternatives
● Apache Foundation
● GNOME Foundation
● KDE eV
● ...
1. Umbrella organizations (in no particular
order)

12. Alternatives
● Provide fiscal entity and financial services
● Key differences:
– Cost structure
– Membership requirements (license,
infrastructure, ...)
– Philosophy and by-laws
– Ecosystem
1. Umbrella organizations (in no particular
order)

13. Alternatives
● “Benevolent” corporate sponsor
● Benefits: Salary, availability of legal and
financial services
● Risks: Changing winds
2. Sugar Daddy

14. Alternatives
● Offload financial and administrative services to
organization
● Provide staff & payroll services, etc.
● Costs money
● See panel “How should we staff & administer
it?”
3. Management services

15. Starting a foundation
● Considerations out of scope for this
discussion:
– Jurisdiction
– By-laws and corporate governance
– IRS 501(c) status
See panel “How do we form a new
Foundation?” - up next

16. Panel discussion
● Dave Neary
– COSM, Yorba, GNOME Foundation
● Ian Skerrett
– Eclipse Foundation
● Bradley Kuhn
– Software Freedom Conservancy
● Cedric Thomas
– OW2