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1. NONPROFIT INVESTOR
INDEPENDENT RESEARCH FOR PHILANTHROPY
Wikimedia Foundation, Inc. SUMMARY
The Wikimedia Foundation, Inc. (“Wikimedia”) is a nonprofit
Nonprofit Investor Rating: organization dedicated to supporting the development and
BUY distribution of online content of collaboratively edited reference
projects to the public free of charge. Along with a network of
chapters, Wikimedia supports the infrastructure and organizational
Mission Statement
framework for these wiki-based projects, including Wikipedia.
The mission of the Wikimedia Foundation is to
empower and engage people around the world
STRENGTHS
to collect and develop educational content
under a free license or in the public domain, ▲ Global reach. With 482 million unique monthly visitors, 21 million
and to disseminate it effectively and globally. Wikipedia articles and 100,000 volunteer editors, Wikimedia projects
are viewed, read and edited throughout the world.
Financial Overview
▲ Highly leveraged operating budget. Wikimedia Foundation's
$ in MM, Fiscal Year Ended June 30
substantial reach required less than $18 million of total expenses in
2009 2010 2011 fiscal 2011.
Revenue and Support $8.7 $18.0 $24.8 ▲ Strong financial discipline. 30%+ operating margin continues to
Operating Expenses $5.6 $10.3 $17.9
build a healthy net asset position and room for expansion of the
% of Total:
operating budget.
Program Expenses 64% 76% 68%
G&A 15% 10% 20% CAUTIONS
Fundraising 21% 13% 12% ● High reliance on volunteer editors. Wikimedia’s operating
leverage inherently causes less direct editorial monitoring by the
Year Founded: 2003 Wikimedia Foundation.
▼ Declining number of volunteer editors. Over the last few years,
Contact Details growth in content has been coupled with a decline in the base of
Wikimedia Foundation, Inc. active editors.
149 New Montgomery Street, 3rd Floor
San Francisco, CA 94105 ▼Revenue highly concentrated in contributions. An opportunity for
Phone: +1-415-839-6885 revenue generation through advertisement exists, but could alter the
Email: infowikimedia.org supply of volunteer editors.
http://wikimediafoundation.org/wiki/Home
EIN: 20-0049703
RECOMMENDATION: BUY
Analyst: RJ Price Wikimedia has actively grown both revenues and expenses in recent
Peer Review: Kent Chao, Arthur Xu years to support its growing operations. Even with that growth, the
large global footprint of Wikimedia projects requires minimal
Publication Date infrastructure and operating expenses. Information quality and
June 11, 2012 future growth in revenue remain concerns, but the impact and reach
currently trump those risks.
Nonprofit Investor Research | nonprofitinvestor.org

2. OVERVIEW OF WIKIMEDIA’S ACTIVITIES
Wikimedia is a US-based non-profit organization that operates a multitude of projects centered on a core belief of free
information sharing throughout the world. All major projects are collaboratively developed by users through the
MediaWiki software, allowing for content to be freely used, edited, copied and distributed within the confines of
Wikimedia’s licensing agreement.
Wikipedia, Wikimedia’s flagship project, is an effort to build free encyclopedias in all languages. Started in 2001,
Wikipedia currently offers more than ten million articles in 273 languages, with the largest collection of articles currently
published in English. Wikipedia is known for its community of followers and volunteer editors, with over 650,000
registered users having made at least ten edits each since inception. While Wikipedia is a “living document”, some
Wikipedias release or plan to release regular “snapshots” capturing the content at a point in time.
Wiktionary creates free content dictionaries in every language. The project aims to be more extensive than a typical
dictionary, including thesauri, rhymes, translations, audio pronunciations, etymologies and quotations. Started in 2002,
Wiktionary is currently available in over 150 languages with over three million entries.
Wikiquote combines quotations from famous people, books, speeches, films or other interesting mediums, with
proverbs, mnemonics or slogans to form a robust database. The project started in 2003 and currently includes over
110,000 pages in over 75 languages.
Wikibooks builds a collection of e-book resources, including textbooks, course material and manuals. It aims to help
both students through self-instruction and teachers through examples of teaching material. Wikibooks began in 2003
and now has over 140,000 modules from over 5,000 books across over 100 languages.
Wikisource is a project to archive a collection of free and open content texts for storing classics, laws and other free
works, as well as a base for translating these texts. Wikisource began in 2003 and currently offers over 880,000 source
texts in total.
Wikispecies provides a central, extensive species database for taxonomy. Launched in 2004, Wikispecies currently has
over 240,000 entries.
Wikinews reports the news ranging from original reporting and interviews to summaries of news from external sources.
Founded in 2004, Wikinews currently has 29 language versions with more than 140,000 news articles in total. Wikinews
aims to provide a free alternative to commercial news sites, while maintaining a fact-checked, neutral position.
Wikiversity is dedicated to learning materials, learning communities and research. Wikiversity’s approach to learning
continues to evolve, but is currently centered on models of “experiential learning”. Established in "beta" phase in 2006,
Wikiversity currently has over 30,000 learning resource entries across 12 languages.
Wikimedia Commons provides a repository for free photographs, diagrams, maps, videos, animations, music, sounds,
spoken texts and other free media.
MediaWiki is wiki software used by all Wikimedia projects and other sites.
PROGRAM RESULTS AND EFFECTIVENESS
Wikimedia is actively focused on tracking metrics related to article counts, new content, active editors, unique visitors,
page views and numerous other operational metrics. The organization’s data-driven focus on analytics allows for
excellent reporting on the scale of the organization, as well as for transparent measures of momentum in key areas.
Wikimedia’s numerous projects reach a staggering viewer base that continues to grow at a rapid rate. At the end of
2005, unique monthly viewers totaled fewer than 100 million. Averaging 35% compounded annual growth over the last
six years, that total swelled just short of 500 million by the end of 2011.
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3. Wikimedia Global Audience
(millions of unique viewers per month)
500
450
400
350 35% CAGR
300
250
200
150
100
50
0
Feb
Jun
Feb
Jun
Feb
Jun
Feb
Jun
Feb
Jun
Feb
Jun
Aug
Aug
Aug
Aug
Aug
Aug
Apr
Oct
Apr
Oct
Apr
Oct
Apr
Oct
Apr
Oct
Apr
Oct
Dec
Dec
Dec
Dec
Dec
Dec
Dec
2005 2006 2007 2008 2009 2010 2011
Source: Comscore through Wikimedia Report Card (January 2012)
Those results on their own are impressive, but become even more dramatic when viewed relative to Google viewers and
most broadly, total internet usage. Over the last three years, Wikimedia’s unique viewers have grown slightly above
total internet usage, as evidenced by Wikimedia’s percentage of total internet users eclipsing 30% in the last half of 2011.
Google continues to generate considerably more traffic than Wikimedia (~75% of total internet users also view
Google.com every month), but with a drastically different infrastructure and budget. For a point of comparison, in 2011,
Wikimedia’s operating budget was $18mm versus Google’s “traffic acquisition cost” alone of over $8.8bn. Before
allocating Google’s vast budgets in General & Administrative, Sales & Marketing or Research & Development, Google
still spends more on traffic alone than 500x Wikimedia’s full annual operating budget. Wikimedia is able to generate and
support an outsized viewer base relative to its minimal operating budget.
Unique Visitors Percentage of Internet Use
(millions of unique viewers per month) (unique visitors percentage of total internet users)
1,600 Wikimedia Google Total 90% Wikimedia Google
1,400 80%
1,200 70%
60%
1,000
50%
800
40%
600
30%
400 20%
200 10%
0 0%
Feb Apr Jun Au Oct De Feb Apr Jun Au Oct De Feb Apr Jun Au Oct De Feb Apr Jun Au Oct De Feb Apr Jun Au Oct De Feb Apr Jun Au Oct De
2009 2010 2011 2009 2010 2011
Source: Comscore through Wikimedia Report Card (January 2012)
To orient potential donors further around the impact of contributions to Wikimedia, the following is an overview of
several key operating metrics.
A relatively small paid Wikimedia staff is able to support a large volunteer base that creates new content, updates
existing articles and edits constantly. As of June 2011, there were 78 employees of Wikimedia relative to approximately
Wikimedia Foundation, Inc. | Nonprofit Investor Research 3

4. 100,000 worldwide volunteer editors in January 2012. When dividing the full operating budget by the total volunteer
editors, implies ~$180 of operating budget to support each volunteer editor.
Across a host of other productivity metrics, the results are even more staggering. Each unique monthly visitor of
Wikimedia projects costs only $0.04 to support. Similarly each of the 21 million articles currently available through
Wikimedia projects costs only $0.85 to support. Each of these metrics is an approximation, but should provide a scale for
the relative impact of the Wikimedia projects versus the corresponding operating budget.
Productivity Statistics
Worldwide Volunteer Editors(1) 100,000
Full-Time Employees(2) 78
Volunteers / Employee 1,282
2011 Expenses Statistic $ / Statistic
(1)
Worldwide Volunteer Editors $17,889,794 100,000 $178.90
Wikipedia Articles(1) 21,000,000 $0.85
Unique Monthly Visitors(1) 482,000,000 $0.04
New Articles per Year(3) 1,840,000 $9.72
Page Views per Year(4) 494,000,000,000 $0.00004
(1) As of January 2012 (Wikipedia Key Facts - Jan 2012)
(2) According to 2011 Annual Report
(3) Assumes new English articles / day as of Jan 2012 grossed up to annual. Uses ratio of 5.4 worldwide articles to English articles
(4) Assumes English monthly page views of 7.6 billion grossed up to annual. Uses ratio of 5.4 worldwide articles to English articles
Sources: Data Summary (Jan 2012) & Wikipedia Key Facts (Jan 2012). 2011 Annual Report
Wikimedia’s flexibility of content is both its greatest strength and weakness. Except in the case of vandalism-prone
pages, any reader can edit content, with immediate effect. Any error or biased opinion is visible to all users until another
editor identifies and corrects any blemish. As Wikimedia continues to leverage a large volunteer base, information
quality largely depends on volunteers with little professional oversight. Wikimedia supporters argue that while “wiki”
content editing lacks professional writers and editors, it provides for viewer consensus to be expressed in each article.
Active Editors (English Wikipedia)
60,000 5+ Edits 25+ Edits 100+ Edits
50,000
40,000
30,000
20,000
10,000
0
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2003 2004 2005 2006 2007 2008 2009 2010 2011
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5. Further straining the issue is that the total active editor base has been in decline since early 2007 (only English Wikipedia
active editors shown in the following chart). With a growing content base and declining number of active editors,
recruitment of additional editors is a noted priority for the organization going forward. NPI has not encountered publicly
available and verifiable information on the evolution of editing frequency per article or metrics on information quality
and error frequency, but that would be an area of additional diligence if access was available. Wikimedia seemingly
provides high quality, relatively unbiased information, but further improvement in information will be predicated on
more active editors and / or increased monitoring by the Wikimedia infrastructure.
FINANCIAL OVERVIEW
Wikimedia’s support and revenue base primarily relies on donor contributions. On the heels of a large fundraising
campaign in 2010 featuring direct outreach from the founder, Jimmy Wales, contributions have represented an
increasing percentage of support – up from 73% of total support and revenue in 2009 to 93% in 2011. Other sources of
revenue, primarily revenue through special events and in-kind service, have remained fairly steady but contribute a
smaller percentage of total top-line as a result of the torrent growth in contributions. Irrespective of the components of
support and revenue, the total has grown dramatically since 2008 ($5.0mm), with 2011 ($24.8mm) representing a 392%
increase over 2008, or a 49% CAGR over that period. Wikimedia believes that this strong historical growth will continue
in the near future. In Wikimedia’s annual plan detailing revenue and expense projections for the upcoming year,
Wikimedia has set a target of $29.5mm total support and revenue in 2012 (+24% Year-over-Year).
Revenue Breakdown Expense Breakdown
$ in millions
$30 $20 $17.9 100%
$24.8 $18 90%
$25 76%
$16 68% 80%
$14 63% 64% 70%
$20 $18.0
$12 $10.3 60%
$15 $10 50%
$8.7 $8 40%
$10 $5.6
$6 30%
$5.0 $3.5
$4 20%
$5
$2 10%
$0 $0 0%
2008 2009 2010 2011 2008 2009 2010 2011
Contributions In-Kind Service Revenue Program General & Administrative
Investment / Other Income Net Assets Released from Restrictions Fundraising Program Expense % of Total
Wikimedia’s 2012 projection appears conservative versus recent growth rates; however, there are several risks worth
noting. First, recent fundraising campaigns have featured direct appeals from Jimmy Wales, draining goodwill towards
the organization with a constant request for donations tied to prominent pictures of Jimmy. As noted in the 2012 Annual
Plan, recent campaigns have been the target of gentle mocking from both the media and general public alike. Wikimedia
has generally relied on Jimmy’s mission and devotion as a rallying cry, but future fundraisers will require new, creative
energy or an entirely new source of revenue altogether. Second, relying on contributions is inherently more volatile than
program revenue. Wikimedia has consciously disassociated from commercial interests given that contributions have
consistently exceeded spending needs and liquidity has been ample (net assets exceed annual expenses). Further, an
advertising model would not likely affect content, but could make editors less likely to volunteer, forcing a switch to paid
Wikimedia Foundation, Inc. | Nonprofit Investor Research 5

6. editors. However, avoiding ad revenue has restricted revenue growth that could be used to fund a more aggressive
infrastructure / organizational build in the medium / long-term. Wikimedia retains the option to pursue ad revenue if
contributions slow, or if strategy dictates a larger spending need.
Detailed Financial Statement (GAAP basis)(1)
Fiscal Year Ended June 30 2008 2009 2010 2011
Support & Revenue
Contributions $4,402,910 $6,297,433 $14,490,273 $23,020,127
In-Kind Service Revenue 333,125 578,279 502,558 349,516
Other Income, net(2) 248,449 410,144 945,968 712,690
Investment Income, net 21,497 17,954 7,219 36,856
Net Assets Released from Restrictions 27,000 1,354,196 2,033,294 665,903
Total Support & Revenue $5,032,981 $8,658,006 $17,979,312 $24,785,092
% Growth 72% 108% 38%
Support & Revenue Sources
Contributions 87% 73% 81% 93%
In-Kind Service Revenue 7% 7% 3% 1%
Other Income, net (2) 5% 5% 5% 3%
Investment Income, net 0% 0% 0% 0%
Net Assets Released from Restrictions 1% 16% 11% 3%
Expenses
Salaries & Wages $1,147,679 $2,257,621 $3,508,336 $7,312,120
Awards & Grants 0 0 208,662 471,060
Internet Hosting 537,204 822,405 1,056,703 1,799,943
In-Kind Expenses 333,125 578,279 502,558 349,516
Operating 952,019 1,259,161 3,846,420 5,761,273
Travel 307,679 223,193 476,663 1,159,200
Depreciation & Amortization 233,314 419,947 524,341 1,000,400
Other(2) 29,704 56,630 143,110 36,282
Total Expenses $3,540,724 $5,617,236 $10,266,793 $17,889,794
% of Support & Revenue 70% 65% 57% 72%
Expense Allocation (% of Total)
Salaries & Wages 32% 40% 34% 41%
Non-Compensation Expense 68% 60% 66% 59%
Support & Revenue Less Expenses $1,492,257 $3,040,770 $7,712,519 $6,895,298
Restricted Contributions 2,054,629 1,367,025 631,739 3,420,018
Net Assets Released from Restrictions (27,000) (1,354,196) (2,033,294) (665,903)
Change in Net Assets $3,519,886 $3,053,599 $6,310,964 $9,649,413
Net Assets at End of Year $5,178,168 $8,231,767 $14,542,731 $24,192,144
Avg. Balance as % of Annual Expenses 96.5% 119.4% 110.9% 108.3%
(1) According to financial statements prepared in conformity with GAAP, as audited by KPMG
(2) Includes special event related revenue / expense
Source: Audited Financial Statements prepared in conformity with GAAP, as audited by KPMG
On the expense portion of the income statement, Wikimedia has maintained strong spending discipline during the last
four years. Expenses have grown considerably to expand the support staff and infrastructure of Wikimedia’s projects,
but still average only 66% of total support and revenue during 2008-2011. This discipline is the result of active planning
and budgeting by the management team.
Wikimedia Foundation, Inc. | Nonprofit Investor Research 6

7. In February 2011, Wikimedia published a 5-year strategic plan outlining strategic goals through 2015 with projected
levels of annual spending to achieve its objectives. In addition to projecting overall spending, expenses are budgeted by
project for the upcoming year, similar to a corporate budgeting process. Wikimedia lists itemized estimates of future
expenses and discloses these numbers to the general public. In the 2012 annual plan, the following five topics were
detailed as top areas of spending increases:
• Additional technical staff and contractors: +$1.6 million
• Increased hosting costs: +$0.8 million
• Mobile platform development: +$0.7 million
• India and Brazil editor recruitment: +$0.7 million
• Increased spending on grants: +$0.7 million
This type of disclosure provides potential donors with both comfort around adequate financial controls and insight into
key spending priorities for new donations.
As a result of the aforementioned healthy operating margin, Wikimedia has consistently generated positive contribution
to net assets annually. In 2011, the organization began the year with $14.5mm in net assets and ended with $24.2mm in
net assets, of which $20.8mm is held in current asset accounts. This controlled spending relative to revenue growth has
maintained sizable liquidity on an absolute basis, as well as relative to Wikimedia’s operating budget; the average net
asset balance in 2011 was equal to 108% of 2011 expenses.
Functional Allocation of Expenses
Fiscal Year Ended June 30 2008 2009 2010 2011
Program
Salaries & Wages $575,956 $1,189,115 $2,378,652 $4,860,808
Non-Compensation 1,663,568 2,425,234 5,471,348 7,260,602
Total Program $2,239,524 $3,614,349 $7,850,000 $12,121,410
General & Administrative
Salaries & Wages $479,078 $481,643 $531,616 $1,618,534
Non-Compensation 597,293 365,216 533,226 2,007,633
Total General & Administrative $1,076,371 $846,859 $1,064,842 $3,626,167
Fundraising
Salaries & Wages $92,645 $586,863 $598,068 $832,778
Non-Compensation 132,184 569,165 753,883 1,309,439
Total Fundraising $224,829 $1,156,028 $1,351,951 $2,142,217
Total Expenses $3,540,724 $5,617,236 $10,266,793 $17,889,794
% of Total
Program 63% 64% 76% 68%
General & Administrative 30% 15% 10% 20%
Fundraising 6% 21% 13% 12%
% of Support & Revenue
Program 44% 42% 44% 49%
General & Administrative 21% 10% 6% 15%
Fundraising 4% 13% 8% 9%
Source: Audited Financial Statements prepared in conformity with GAAP, as audited by KPMG
Wikimedia allocates its expenses within three major classifications: program, general & administrative and fundraising.
Audited financials from KMPG provide a clear breakout between the three buckets and also provide a breakout of
Wikimedia Foundation, Inc. | Nonprofit Investor Research 7

8. salaries / wages and non-compensation related items within each category. For the period of 2008-2011, program
expenses averaged 68% of total, general & administrative expenses averaged 19% of total and fundraising expenses
accounted for 13% of total spend. In isolation, the relative percentages of general & administrative and fundraising
appear to account for a large percentage of expenses. Since most of Wikimedia’s “contributors” are volunteer editors,
the Wikimedia G&A staff must be viewed in the context of the operations, not just the operating budget. Given this
context, it is staggering that in 2011 Wikimedia only spent $3.6mm on G&A to manage an organization with over 21
million articles, nearly 500 million monthly visitors and approximately 500 billion page views per year.
FUTURE OF WIKIMEDIA
Wikimedia is actively aware that while its progress to date has been extraordinary, there is an active pipeline of goals for
the future. In the recent 5-Year Strategic Plan, Wikimedia set out the following strategic priorities and targets:
“Our strategic priorities over the next five years:
• Stabilize infrastructure
• Increase participation
• Improve quality
• Increase reach
• Encourage innovation
We will know we’re succeeding when we reach these critical targets:
• Increase the total number of people served to 1 billion
• Increase the number of Wikipedia articles we offer to 50 million
• Ensure information is high quality by increasing the percentage of material reviewed to be of high or very
high quality by 25 percent
• Encourage readers to become contributors by increasing the number of total editors per month who
made >5 edits to 200,000
• Support healthy diversity in the editing community by doubling the percentage of female editors to 25
percent and increasing the percentage of Global South editors to 37 percent” (Wikimedia Strategic Plan).
The support of future donors and volunteers will be crucial to reaching these aspirational goals.
TRANSPARENCY
Wikimedia prides itself on being one of the most transparent nonprofit organizations in the world and their actions
strongly support that claim. Through their Wikimedia Foundation website, a plethora of organizational materials are
available for free to the public:
• Financial Information: Audited financial statements, Form 990s and detailed financial planning documents are
available on the Financial Reports section of Wikimedia’s website.
• Strategy Documents: One-year forward annual plans and long-term strategic plans are well developed and
readily available.
• Board Materials: The Wikimedia Board of Trustees posts meeting minutes and resolutions.
• Policies and Procedures: All key policies and procedures, including Privacy Policy, Donor Privacy Policy, and
Trademark Policy, are available in their entirety.
Wikimedia Foundation, Inc. | Nonprofit Investor Research 8

9. THIRD PARTY RATINGS
Charity Navigator
• Overall rating of 65.49 (out of 70) / 4 stars (out of 4).
• “Financial” subcategory ratings of 65.04 / 4 stars based on key financial metrics.
• “Accountability & Transparency” subcategory ratings 66.00 / 4 stars based on key performance metrics checklist.
• Highest rated organization amongst five identified as “Performing Similar Types of Work”.
GreatNonprofits
• Average rating of 4+ stars out of 5 across 13 reviews.
• Individual reviewers cite similar amazement at the incredible leverage of resources, “the relative size of their
projects and the relatively low cost of these projects compared to sites of similar size” and the impact of
Wikimedia projects on global knowledge aggregation.
GET INVOLVED
• Donate: https://donate.wikimedia.org
• Become a volunteer: http://wikimediafoundation.org/wiki/Category:Volunteering
• Become an editor: http://wikimediafoundation.org/wiki/Our_projects
DISCLOSURES
RJ Price certifies that he does not have any affiliation with Wikimedia Foundation, Inc. and has never made a donation to the
organization. Additionally, RJ has not supported directly competing organizations in a greater capacity than a nominal donation. NPI
analysts and NPI as an organization do not receive any form of compensation from reviewed charities.
This report is for informational purposes only and does not constitute a solicitation for donations. While the reliability of information
contained in this report has been assessed by NPI, NPI makes no representation as to its accuracy or completeness, except with
respect to the Disclosure Section of the report. Any opinions expressed herein reflect our judgment as of the date of the materials
and are subject to change without notice. NPI has no obligation to update, modify or amend any report or to otherwise notify a
reader thereof in the event that any matter stated herein, or any opinion, projection, forecast or estimate set forth herein, changes
or subsequently becomes inaccurate, or if research on the subject organization is withdrawn.
Opinions and recommendations in our reports do not take into account specific reader circumstances, objectives, or needs. The
recipients of our reports must make their own independent decisions regarding any organization mentioned by NPI.
Wikimedia Foundation, Inc. | Nonprofit Investor Research 9