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Comment by umvi | Hacker News Reader

I do like his idea of building up investments and running wikipedia off of ROI instead of begging for donations every year. Why is it that WMF hasn't done that yet?

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It has been raising an endowment for several years: https://meta.wikimedia.org/wiki/Wikimedia_Endowment

You can donate at https://donate.wikimedia.org/w/index.php?title=Special:Landi...

It has indeed been raising an endowment for several years, but every time I ask them to structure the endowment so that the WMF cannot legally dip into the principal when times get bad the answer is "maybe next year".

If the endowment is just one more account that can be drained at will we have no protection from a sudden drop in revenue while the WMF maintains the current spending levels in the hope that revenue will recover.

I also looked into whether the endowment is legally protected against a large payout as a result of a lawsuit. I am not a lawyer, but it looks like the WMF needs to structure the endowment so that the WMF cannot legally dip into the principal to get that sort of protection.

Full disclosure: I am the author of the Wikipedia essay "Wikipedia has cancer".

I would like to see the Gates Foundation and co start investing in more media endowments like this.

Seems like a terrible investment for the Gates foundation. It is highly visible and has ample public funding. Additionally, it appears that it has no budget control.

Do the math. Their expenses for 2017-2018 were 81,442,265 (81 million). To live off interest (let's say they pull a safe and solid 5%. If you can reliably do better than 5% with annuity-level thinking, good for you), they'd need 1/0.05 = 20 times their run rate, or 1,628,845,300 (1.6 billion).

They hold just under 135 million in assets, so they'd need 12 times what they currently hold. That's why living off interest wouldn't work. They'll need the telethon til they can make that equation work, or at least come closer.

The point of the article, if I an reading it right, is that WMF was doing about as much good when it was spending 23x less. That means they could spend nearly twice as much as that and still live off interest.

The other point of the article is that WMF has zero willingness or ability to restrain its spending growth (demonstrated over a period of years), much less cut back by 23x.

That only makes their endowment funding wrong. He's collecting endownment while spending his as off

You can’t “live off interest” like that - you need to let the endowment grow by at least inflation. Or else your endowment and its yearly returns will dwindle in real terms

Full disclosure: I am the author of the Wikipedia essay "Wikipedia has cancer".

See https://news.ycombinator.com/reply?id=21700802 and https://en.wikipedia.org/wiki/User:Guy_Macon/Wikipedia_has_C...

Letting the endowment grow by at least inflation is already covered in my essay:

"We should make spending transparent, publish a detailed account of what the money is being spent on and answer any reasonable questions asking for more details. We should limit spending increases to no more than inflation plus some percentage (adjusted for any increases in page views), build up our endowment, and structure the endowment so that the WMF cannot legally dip into the principal when times get bad."

"If we do these things now, in a few short years we could be in a position to do everything we are doing now, while living off of the endowment interest, and would have no need for further fundraising. Or we could keep fundraising, using the donations to do many new and useful things, knowing that whatever we do there is a guaranteed income stream from the endowment that will keep the servers running indefinitely."

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