I would like to help the Internet Archive thrive for very long time. An endowment is one tool, but financial endowments have some issues, so what about exploring non-cash endowments? Non-financial endowments, if done correctly, appears to create longer term sustainable foundations for public-benefit organizations. Here is the reasoning.
Endownments, meant to help sustain a public benefit organizations over the long term, are generally managed by investment firms and banks. The idea is that they spin off cash that can help run the organization or grow the endowment. At UC Berkeley, the school may spend up to 5% of the endowment as that is what is thought to be the annual growth rate after inflation. In other words, the bankers should get 5% on the holdings on a continuous basis, so the organization can spend that much and not decrease the principle, even after inflation.
My financial holdings over the last 15 years seem to do a bit better than inflation, but not 5% over inflation. Furthermore, what financial endowments are often managed to make money rather that support the goals of the organization, and can even be in contradiction to the aims of the organization. Also, the periodic hyper-inflation and financial collapses can wipe out holdings.
How can we endow an organization without putting money in a bank account and hoping for interest to pour out?
For the Internet Archive, about 70% of the spending goes to salaries, the rest to computers electricity bandwidth and other things. The facilities are have been purchased so these expenses have already been minimized. So if there were some way to support the employees salaries, that would be the best way to support the organization. We can either come up with the cash our employees expect, or maybe we could find a way to offset their cash needs.
Our employees spend 30%-60% of their income on housing. Therefore, if equal or better housing appeared at a reduced cost, we might be able to reduce salaries. Similarly if food, healthcare, education, transportation expenses could be reduced then the need for salaries could be reduced.
I do understand this is counter-trend, but there are precedents. Universities, armies, religious, and other intentional communities have had subsidized housing and other services bundled into their overall function.
Maybe it is better to talk about communities rather than employees since we would like to support families not just workers.
Therefore, supporting the housing, farming, schools, and health needs of the community that makes up the public-benefit organization can be a form of endowment.
Investing in debt-free housing, low labor farming, custom schooling and ways to keep our selves healthier could help significantly.
Rethinking our endowment approaches to be better foundations for our public-benefit organizations is ripe. Any help would be most appreciated.
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