The first open company

http://blog.gittip.com/post/26350459746/the-first-open-company

by zende • 14 years ago

101 72 14 years ago

blog.gittip.com

loceng2• 14 years ago

I feel this is how all charities should be run.

ReadEvalPost2• 14 years ago

I'm with you on transparency, but I don't know how you expect charities to survive without paid employees.

lowmagnet• 14 years ago

I'd guess through volunteer time, as a lot of charities are run on the ground. Anything to reduce overhead cost.

loceng2• 14 years ago

I think the issue is more with motives. If people have money incoming from elsewhere then it shows, at least some, that they're not doing it because they just want a paycheck.

fiatpandas• 14 years ago

I know of one charity that is pretty open and transparent about its operating procedures, scholarly findings and statistics, finances including employee compensation, and pretty much every other bit of data that doesn't compromise patient confidentiality (they operate a hospital in rural Nepal):

http://nyayahealth.org

brackin• 14 years ago

I totally agree, which is why I'm working on a startup to make charities more transparent and allowing them to make use of the resources they can get once they do this. (Andrew@brack.in if anyone has any ideas).

zende• 14 years ago

The open discussion on company decisions is the most open part to me (https://github.com/whit537/www.gittip.com/issues). That's more significant than releasing the source.

amix2• 14 years ago

I like the idea behind Gittip, but I think this is bullshit: "company are developed for the benefit of society as a whole, and not just the mutual benefit of the members of the cooperative" Most companies are developed for the society and for people and most advances in human history have been done by for-profit organizations. Even the ideas in capitalism (as stated in e.g. Wealth of Nations) are grounded in benefits for the society and for the people.

whit53721• 14 years ago

My point about benefit to society vs. mutual benefit was a technical one about the definition of an open company vis-a-vis the definition of a cooperative, "an autonomous association of persons who voluntarily cooperate for their mutual social, economic, and cultural benefit"[0]. It wasn't meant to be ideological.

I love cooperatives. I started one: an organic produce growers' cooperative. I also love Wealth of Nations, and I love capitalism. The company behind Gittip, Zeta Design & Development, LLC, was started in 2002 as a for-profit company and was run that way for a decade. Here's me praising corporations:

http://blog.gittip.com/post/25215503687/corporations-and-ope...

My question is, can we do even better?

----

[0] http://en.wikipedia.org/wiki/Cooperative

amix2• 14 years ago

Ok, thanks for the clarification. I had read cooperative as a corporation (or understood it like that).

why-el• 14 years ago

> most advances in human history have been done by for-profit organizations

You mean most advances in (very) recent history right? And I am a bit skeptical about the claim that companies are developed for the benefit of the people. Again, I have a problem with your generalizations. At least in our field, a lot of the research is actually publicly funded.

rokhayakebe2• 14 years ago

Most real-life applications of discoveries that advanced humanity have been done by for-profit organizations. Applied science.

Most advances in human history have been done by individuals who were simply passionate about a topic, and they did not do it for money. Theoretical science.

edanm• 14 years ago

Do you have a source for this claim?

Although honestly, I think we shouldn't talk about "most" throughout history, because democracy/free trade/capitalism is pretty new, so we need to normalize for that.

aik• 14 years ago

> "Most companies are developed for the society and for people"

I think most companies exist to make money. However the "invisible hand" often leads to mutual benefit.

funthree• 14 years ago

>most advances in human history have been done by for-profit organizations.

Not even close. Also, see the article about how cartels are an emergent property[1] of a free market. Not that there really exists a better system than what we currently have, but don't kid yourself into thinking capitalism is some kind of benevolent savior of mankind. It's just not true.

1. http://news.ycombinator.com/item?id=3494224

russell• 14 years ago

Good stuff.

Way back in the day I decided to become a software developer instead of getting my PhD in economics. Economics didnt make any sense to me. It was all philosophy and religion. As an undergraduate, I read only one article that had even basic calculus in it. Perhaps I should have majored in physics and then got my Economics PhD., but nobody did that sort of thing.

DividesByZero• 14 years ago

Minor point, but On The Wealth of Nations has nothing to say for or against Capitalism.

speg• 14 years ago

Either my monitor is broken, or that is very light text on a white background...

whit53721• 14 years ago

Or you're on Arch Linux? Does this ticket relate?

https://github.com/whit537/www.gittip.com/issues/140

fusiongyro• 14 years ago

Completely unreadable for me in RHEL 5.7 + FF 7.0.11, even at 300% magnification.

whit53721• 14 years ago

I've added this to the ticket:

https://github.com/whit537/www.gittip.com/issues/140

crazygringo• 14 years ago

Please don't call this a "company" of any sort.

A company that doesn't pay its employees is neither a company, nor does it have employees.

And honestly, why is "cost" for non-employees allowed, but not cost for employees? An "open company" makes sense in terms of radical transparency, but a term like that shouldn't be related in any way to banning monetary compensation.

whit53721• 14 years ago

I daresay the Commonwealth of Pennsylvania disagrees with you about whether Zeta Design & Development, LLC is a company.

Cost for non-employees is "allowed" for the practical reason that if it weren't, an open company couldn't participate in the economy as it stands today.

If you want transparency without the non-compensation, look into B Corporations: http://www.bcorporation.net/about

ry0ohki2• 14 years ago

Didn't realize this was a Pittsburgh area company, are you involved with any of the tech groups in the area? Also, you have my respect if you can pull off something non-standard within the state, I've found PA to be a real PITA to deal with compared to say Maryland or especially Delaware.

ethanpil• 14 years ago

What incentive do employees have to work for free?

Why are you not calling yourself a non-profit?

mwhite• 14 years ago

I suppose he might gittip them.

whit53721• 14 years ago

The incentive is the same as open source programmers have to work for free.

RE: non-profits ... from the post:

"An open company differs from a non-profit organization in that an open company does not itself accept donations, and it does not compensate its employees. From the open company’s point of view, whether and how its employees receive money and for what, is undefined."

DASD6• 14 years ago

Since when are non-profits required to accept donations or even have employees?

chatmasta• 14 years ago

Hellloooo communism.

whit53721• 14 years ago

Exactly. You can expect my secret police to visit you tonight. ;-)

pfraze2• 14 years ago

How will you solve the issue of fair pay among employees? Isn't it likely that public awareness and popularity would determine who gets paid, regardless of who does the work?

If this model is successful, and people begin to see whit537 as a kind of celebrity (like notch or moot) then how would the other employees work their way into the revenue stream?

whit53721• 14 years ago

This is an important open question. Some thinking here:

https://github.com/whit537/www.gittip.com/issues/27

pfraze2• 14 years ago

Cool, thanks. I appreciate the work you're doing here; hope it goes well.

WiseWeasel2• 14 years ago

How is this different from most open source projects? Because it's a registered LLC? Because they have public policies enforcing transparency? Failing to pay your "employees" combined with an onerous set of requirements for them seems like a non-starter at worst, and unsustainable at best, since it takes all the fun out of volunteering. If I'm being held accountable and even liable for my involvement, I should be getting compensated for it. This just seems like the worst parts of corporate employment and open source projects mixed together for some reason; all the fun of filling out TPS reports, for none of the pay or benefits.

whit53721• 14 years ago

From the post:

"An open company differs from an open source project in that an open company is a formal legal entity, and needn’t be about software."

The set of employees of an open company is much, much smaller than the set of people working on whatever-it-is that the open company nominally "owns"--really it's a commons. The only reason to have employees at all is to formalize access to private data such as passwords and private user data.

Gittip, for example, has one employee, me. If you counted up everyone who has weighed in on GitHub we'd have maybe 20 or 30 community participants by now? Many more depending on how you draw the lines.

If I understand you right, the "requirements" would apply to the small set of people with access to private data, not to the majority participating in building whatever-it-is together.

WiseWeasel2• 14 years ago

I guess my confusion stems from the attractiveness of being an employee of this company. It sounds like these employees will be resolving customer support issues, since they need access to private account information, and they will be legally liable for their use of this private information, since their access is made public. Why would someone agree to do this kind of work without any compensation? How long will these employees stick around? What kind of vetting system could possibly ensure the integrity of these people with access to my account info?

mmahemoff• 14 years ago

Wouldn't this be pretty much like MediaWiki, prior to it having paid employees, or other non-profit foundations?

I'm actually not clear why this is a company instead of a non-profit foundation. It says:

A non-profit can also not accept donations and not compensate employees, so the only thing that differs might be how employees receive money, which I don't really understand here.

thomasknoll• 14 years ago

"why?"

terryk88a• 14 years ago

to pull one's chain, to see what kind of reaction he'd get from whatever suckers and chumps he can fool with this BS

or he really believes this BS and has narcissistic personality disorder

whit53721• 14 years ago

You have conclusively exhausted the possibilities.

fredBuddemeyer• 14 years ago

0 marginal cost goods and organized, free labor test the foundations of capitalism and necessitate the development of new institutions. this project adresses both of these - and the economic possibilities of patronage/tipping. why the hell not?

potomak• 14 years ago

I'm trying to do the same with http://tomato.es

drone• 14 years ago

Functional questions:

1) If all products are priced at-cost, and no employees are paid, is that to be assumed there will be no products sold that aren't at least, in part, developed using third parties?

2) If everything is priced at exactly their cost, what costs are factored in to pricing? Do you factor sunk cost, or only COGS?

2.a) If everything is priced at cost, and there is no added price for value, do you expect that every product will sell past its sunk and production costs? If not, who covers the loss when a product doesn't sell enough to meet its cost of production. (For example, some products require a minimum quantity to purchase/build before they are priced at a point the market will accept, to achieve pure cost parity without loss, you'd have to sell every unit in the same fiscal year.)

2.b) If 2.a can be accepted as some products will fail to meet their objectives, who makes up the difference? I.E. who put their money up-front to manufacture the products, and absorbs the loss?

whit53721• 14 years ago

1) Afaict everyone depends on third parties. Even if I pick wild blackberries, where do I get the containers to put them in?

2) Sunk cost. The intention is to factor out wages and profit.

2.a) Maybe use Kickstarter here?

2.b) The community of people who want the product.

dinkumthinkum• 14 years ago

I had a lot of things to say but now I just have the one question. What's so wrong with making money? I'm really interested. I think a lot of outsiders to our industry would be surprised to know how rampant to anti-money view is or at least against anything other than earning a very modest, and very simple living.

whit53721• 14 years ago

Nothing's wrong with making money? I'm currently looking for $2,000.00 per week myself:

https://www.gittip.com/whit537/

;^)

The first open company

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