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Open Source and Start-up Model Breakout

In the spirit of capturing this “Open Source” conversation on 6/26/16, I would like to invite you to add your thoughts to the notes below. It would be especially helpful to add additional resource recommendations to the list published near the bottom of the notes.

How can open source ethic change nonprofits? What in particular interests the group about this topic?

  • Applying new or innovative models to nonprofit model

  • What does it mean to apply “Start-up Model”?

  • Also wanting to look at other alternative business models (B-Corp, Social Enterprise)

What does “Open Source” mean?

  • Example: Red Hat Operating System is an open source software platform. The platform is free, but the company makes money from services and support. The company is currently valued at $1 Billion. When company started, detractors said that you couldn’t find a business model to support giving away a company, but RedHat has been successful as a company and other companies have followed a similar model of development (Drupal, WordPress).

  • Applying OS model to the nonprofit space could mean giving away central products or services.

  • Aside from the “free” and open pricing model and approach to intellectual property, “Open Source” generally also relies on community involvement, collaboration/ crowdsourcing, and a distributed development approach.

  • Opportunities to open source both products/ services as well as operations. Remote working/ teleworking adoption by nonprofits could decrease overhead and create new culture for collaboration.

Opportunities for Open Source and Good Examples

  • Software: Nonprofits fund customized software projects such as CRM’s and then other clients have access to it. The cumulative development process decreases costs and increases innovation for the whole sector. (Example: Drupal)

  • Advantages of Open Source model: Cost, Support, Innovation

  • The truly disruptive element of the open source model is “community” and “transparency.”

  • Difference between traditional chapter model and open source model? Distinction: ownership, central control, licensing (Question: Is Habitat for Humanity open source?)

Barriers/ Drawbacks to applying open source model to traditional nonprofit?

  • How to monetize and find sustainable business model to bring nonprofit or project to scale?

  • Competition with other nonprofit organizations for resources

  • For open source to work, need an engaged and growing community.

  • Need to focus on results, not “credit.” Most nonprofit organizations need to take credit to explain value to funders, boards etc.

  • Brand dilution

  • Not being able to ensure quality of open sourced efforts. (Example: Chapter program with no oversight and governance/ accountability problems)

  • Ideas met with resistance from traditional model (Anarchic/ Communist)

  • Does innovation really = more funding? One challenge is how grant process usually works is that speed and agility are often not rewarded by funding.

  •  To some degree need to be comfortable with some level of failure.

Best practices from open source and “start-up” models

  • Allow space to innovate (Google employees get to spend 20% of time on innovation). Support “intrapreneurs” within organizations.

  • Make data available to public and other orgs

  • Start with small projects if you are a large traditional organization looking to make some “disruption” to normal way of doing things. Then build on key learnings with bigger initiatives.

  • Thinking of new model as “multistakeholder engagement” vs. “open source.” Collaboration, giving and sharing important for success of organization and initiatives.

  • Biomimicry” study and imitation of nature/ natural systems for innovation and systems

  • Is this idea of “open source” really new and disruptive or is just a new term to describe the open exchange of communication and ideas? (Ben Franklin, Tesla etc.)

Examples of successful open source efforts:

Resource recommendations

  • A Year Without Pants” looks at the building of the WordPress company and how 120 WP staff telework from around the world

Pumpkin Plan” – Applies principles of growing a large pumpkin to growing a large business.