[OpenID board] OpenID Financial report

Johannes Ernst jernst at netmesh.us
Tue Nov 4 20:05:57 UTC 2008

I'm going nuts. We have something resembling financials!! For the  
first time since the foundation incorporated.

As a board member, I'd also like to see:
  - previous time periods not just the most recent 6 months (Why is it  
Apr-Sep? Our tax year is the calendar year, isn't it?)
  - a break-down of some of the larger items, e.g. 846 - Outside  
  - a cash-flow statement for each of the time periods
  - comparison with the budget we passed

I don't want to see the general ledger -- that's a level of detail not  
needed either by the board or the membership, and it contains a bunch  
of data that could reasonably be considered confidential by the  
vendors / contractors / employees involved.

And, of course, a forward-looking budget as soon as possible.

On Nov 4, 2008, at 11:38, Dick Hardt wrote:

> Fellow board members
> Attached are the financial statements for the Foundation. These  
> statements are less then ideal, but I think sharing what we have is  
> better then not sharing anything.
> Items to note on these financials:
> ---------------------------------------------
> - We received the $50,000 payment from Microsoft for their corporate  
> board seat[1] which
> - We also received $10,650 in membership fees. This is an increase  
> from previous months and is a key metric to track as it balances the  
> revenue from the corporate board members.
> - Expenses are as expected. Note that none of the marketing  
> projects[2] were expensed in September, so this number is not  
> indicative of our normal expenses.
> - We had $140K in cash at the end of the month, so there is no fear  
> of the Foundation running out of funds near term.
> General Observations:
> -------------------------------
> - the anticipated fully loaded cost of the new Executive Director  
> (included travel etc.) is estimated to be $200K - $350K
> - based on the CRC report, the community and corporate sponsors  
> expect the Foundation to roll out programs, which will cost money.  
> Given the lack of any substantial budget input, I would estimate  
> that costs to be similar to the ED: $200K - $350K.
> - this leads to a budget of between $400K - $700k.
> - I would estimate our current annual revenue to be $100K from  
> community and $250K from 5 corporate seats. This is only $350K, a  
> $50K to $350K shortfall.
> - Although we have 2 other corps willing to pay $50K each, the board  
> has not approved these other board members from joining.
> - There is significant risk that the current revenue may not be  
> repeated if the community and board members do not think they are  
> getting value for their funds.
> Summary
> -------------
> We either need to drastically reduce our budget and lower our ED  
> expectations, or actively increase our revenue in a timely manner.  
> Not addressing the revenue will significantly hinder our ability to  
> retain an ED of the calibre we have been recruiting.
> -- Dick
> [1] for those wondering why we just did receive the $50,000,  
> Microsoft had made a substantial contribution to OpenID by way of  
> the legal fees for the IPR agreement. They essentially had spent  
> their OpenID Budget and had to go back to get the funds for the  
> board seat. Given
> [2] The core messaging platform project (~$10K left) and the CRC  
> project ($10K)
> <CPA  Report September 30, 2008.pdf>
> _______________________________________________
> board mailing list
> board at openid.net
> http://openid.net/mailman/listinfo/board

Johannes Ernst
NetMesh Inc.

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