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We’ve spoken earlier than about Lichess’s moral stance and the way we do “enterprise”. Certainly, on the backside of this and each different of our weblog posts there’s a quick rationalization:
Lichess is a charity and completely free/libre open supply software program.
All working prices, growth, and content material are funded solely by consumer donations.
We aren’t going to concentrate on that side once more (not less than not at present), however as an alternative make clear what it means to be a non-profit or a charity, because it’s clearly a message that should get on the market extra:
FIDE Director Common Emil Sutovsky stated in an interview that FIDE is the one non-profit chess physique.
Absolutely it was an sincere mistake, however Lichess, the second largest chess web site on this planet with greater than 5 million video games performed every day, is a registered French non-profit. pic.twitter.com/yIHItfonRg
— Lichess.org (@lichess) September 26, 2022
Follow us via the definitions!
Non-profit: no internet revenue (revenue past bills) will profit any particular person.
That is in distinction to most companies the place both non-public house owners or public shareholders achieve monetary advantages from the income of the enterprise.
Charity: an organisation with philanthropic targets, aiming to enhance a group in a roundabout way.
In fact, exact authorized definitions will range by nation, and technically Lichess is a French affiliation — which encompasses non-profit standing and charitable standing — with a objective to “promote and encourage the educating and apply of the sport of chess and its variants”.
Definitions over, onto the principle article!
A typical false impression we see is that our non-profit standing means Lichess is barely surviving. In spite of everything, an organisation with out revenue is a foul organisation, proper? No!
Revenue is a mechanism the place people (house owners or shareholders) syphon off worth from an organisation for his or her private achieve. For a non-profit, we are able to generate the identical revenue as a for-profit firm, however the important thing distinction is that all of that revenue goes again into the organisation, to maintain it rising, hold making it higher, and in our case hold it free.
There’s plenty of rhetoric about how companies can do extra for the group, by advantage of being for revenue. However in actuality, a non-profit is placing 100% of its revenue again into the group. Absolutely the quantities could also be completely different, since a smaller proportion of a bigger complete revenue can nonetheless be extra general, nonetheless for equal revenue a non-profit is by definition doing extra (or not less than must be!).
Lichess additionally generates (nearly) all our revenue from donations, however in idea, a non-profit may have a subscription/paywall mannequin and probably generate far more revenue (don’t fear, we gained’t). The explanation we don’t use that type of enterprise mannequin just isn’t {that a} charity couldn’t use it. As an alternative it’s as a result of we predict it’s a unhealthy mannequin for attaining our objective of selling chess.
The ultimate wrinkle within the definitions is that it’s attainable to be a non-profit however, like FIFA, nonetheless take cash out of an organisation in different methods. Rule-abiding non-profits (reminiscent of Lichess) additionally pay salaries to staff. We publicise these at lichess.org/prices so you’ll be able to see whether or not these are in keeping with market charges and affordable.
Lichess has plans to grow to be the next class of charity inside France – and a few of what we have achieved over the yr is to analysis and start that multi-year course of. We’ll give an replace on that, and our charity’s plans, later this yr.
Thanks for listening to our TED speak!
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