- 1 What is Open Collective?
- 2 Why Open Collective?
- 3 How does it work?
- 4 Why Open Source?
- 5 Why not use the Blockchain and Cryptocurrency?
- 6 Terminology
- 7 We are all individuals
- 8 Entities & structure
- 9 Fiscal Hosts
- 10 Financial Contributors
- 11 Non-financial Contributors
- 12 Company
- 13 Pricing
- 13.1 The short version
- 13.2 Starter Plan for Single Collectives.
- 13.3 An organization and want to create multiple collectives.
- 13.4 What is a Fiscal Host?
- 13.5 More info about Fiscal Hosts.
- 13.6 Collective
- 13.7 Open Collective Paris
- 13.8 Brussels Together
- 13.9 Independent Project
- 13.10 How are Open Collective's fees determined?
- 13.11 Community Guidelines
- 13.12 Be honest
- 13.13 Collective first
- 13.14 Be inclusive
- 13.15 Be respectful
- 13.16 Be mindful
- 13.17 Speak up
- 13.18 Share the love
- 14 Values
What is Open Collective?
Open Collective is a platform where communities can collect and disburse money transparently, to sustain and grow their projects.
Why Open Collective?
Internet has been really good at helping people do great things together. But things still get complicated once money is involved. These challenges hold communities back from getting all the support they need from backers and sponsors to achieve their mission.
We enable communities to have economic power, so they can sustain themselves and have a larger impact in the world.
How does it work?
Our platform provides tools for legal entities to fiscally sponsor Collectives under their umbrella, empowering people to create associations without friction. It's like an API between the legacy world of banks and taxes and the emerging future of digitally powered distributed collaborations.
The goal of Open Collective is to create a New Form of Association for the Internet Generation.
Why Open Source?
For starters, we are believers in the open source philosophy. Our code is open source, and so are the Collectives we host. We think transparency in technology and finances is important.
Additionally, regulations are different all over the world. Our platform is the API between Collectives and things like governments, banks, payment processors, and taxes, which vary a lot by country, so it has to be adaptable to different requirements.
Why not use the Blockchain and Cryptocurrency?
We're excited about the new possibilities these technologies are creating, and we'd love to explore how they could help us achieve our goals. But just like we won't wait for self-driving cars to become ubiquitous before calling a Lyft, we're very practical about using existing services to solve problems right now. We can already get pretty far using well-established technologies already integrated with global systems. That said, we are actively exploring how to support cryptocurrency on the platform, so if you're interested in that, get in in touch.
We have developed some terminology to describe interactions and roles on Open Collective. Please use these terms when creating issues or support requests, instead of user —everyone is a user!
We are all individuals
People are individuals. They can form entities inside Open Collective, like Organizations and Collectives, which enable collaborative impact and define interactions between individuals.
Entities & structure
Human beings with names. An individual signs up to Open Collective with their email address. An individual can take on different roles throughout the platform.
An Organization represents a company or legal entity in the world, with a shared identity, bank account, credit card, and resources. This is often how Sponsors engage on the platform.
Individual(s) who create and/or manage the Organization profile. They have rights to edit the settings of the Organization, set up financial contributions to Collectives, and set up gift cards, among other things.
A Fiscal Host is a type of Organization.
Fiscal hosting enables Collectives to transact financially without needing to legally incorporate. A fiscal host is a legal company or individual who holds a Collective’s funds in their bank account, and can generate invoices and receipts for Financial Contributors. You can think of a fiscal host as an umbrella organization for the Collectives in it.
Fiscal Host Admin
Individual(s) who create and/or manage the Fiscal Host are responsible for approving new Collectives who want to join the host and paying out expenses approved by Collective admins.
Fiscal Host admins want tools and workflows to easily manage their tasks (paying expenses and approving new Collectives). They need to charge their fees and keep a useful accounting system. They are often the first point of contact for the Core Contributors of Collectives they host, and many are super-users.
The primary entity most representative of the basis of our platform. A Collective represents a project or group that has a mission or purpose in the world, which they raise and spend funds transparently to achieve.
Individuals who are major contributors and represent the Collective with their face on the Collective page as part of the team.
A type of Core Contributor with additional permissions, so they can edit the Collective, change settings, approve expenses, make financial contributions to other Collectives, and receive messages from people trying to contact the Collective.
Core Contributors want to make their communities sustainable financially, so receiving financial contributions is first on their priority list. They use tools like tiers, goals, and social media sharing. They are interested in managing and growing their communities by creating events and sending updates.
Individuals who register to attend a Collective's event. They often arrive through a direct link provided by the event organizers. They want a smooth, hassle-free experience, clear information about the event, and ideally a pathway to stay in touch or become contributors.
User actions & relationships
Every action inside Open Collective is based on contribution.
- The word we will use for "someone who contributes to a project" is "contributor". The buttons on tiers will say "contribute".
Organizational Financial Contributor
A company that supports a Collective financially, often at a higher tier. This is often called sponsorship in practice, but can go by other names depending on the Collective's context, such as base supporters, members, etc.
Sponsors often represent companies with accounting and reporting needs. They may want brand exposure, access to or goodwill from a community, tangible benefits like support, or help with their recruiting efforts.
Individual Financial Contributor
Supports a Collective financially, with a repeating or one-off contribution.
They arrive at a Collective many ways:
- Search from homepage
- Discover page
- Direct link to a Collective
- Github badges on README
- Organization's page
- Our blog or newsletter
An individual who requests payment from the Collective's budget using the expense function.
There are two different formats to contribute financially:
- One-time financial contribution
- Recurring financial contribution
Supporting Collectives by providing the legal and financial infrastructure needed to accept money and make payments.
An individual can contribute with code (software) to an open source project with a Collective
An individual who contributes time or skills to a Collective's mission.
Terminology usage guidelines
Because there are a lot of concepts and moving parts on the platform, we try to be careful with the words we use and how we use them, to avoid confusion.
Terms defined above that function as a proper noun (name) of a specific role or entity, as opposed to the everyday meaning and usage of that word. Please capitalize the following terms in documentation and in the app.
- Fiscal Host
- Admin (Collective Admin, Fiscal Host Admin)
- Core Contributor
These words are used a lot in common language and don't need to be capitalized all the time, but when referring specifically to the feature on our platform it is like a proper name, so it can be capitalized to better communicate what you mean.
Do not capitalize the above words when they do not refer to the name of a role or entity on the platform. For example:
- You can think of Fiscal Hosts as umbrella organizations for Collectives.
'Fiscal Hosts' and 'Collectives' are capitalized because they refer to names of roles on the platform, but 'organization' is not because it's used here as part of the common phrase 'umbrella organization'.
Words to avoid
There are a lot of names and terms we have used in the past or that have common meanings close to roles and entities on the platform. It's important to use language that your intended audience will understand and identify with, so no words are banned, but be mindful of using the below terms as they can easily introduce confusion.
Everyone is a user, so it's not super helpful when trying to refer to something more specific.
This is a common word to describe when a company gives money to a project, but it's caused confusion because sometimes sponsorship is defined by the kind of entity making the financial contribution (company vs individual), and sometimes it's defined by how much they are contributing (e.g. some Collectives call everything over $1000 'sponsorship' regardless of who gives it). Collectives can each define these things for themselves, so it's safer to refer to "individual financial contributor" or "organizational financial contributor".
Similar to the above. If a company gives only $5 a month, are they a backer or a sponsor? That's undefined globally, so stick with "financial contributor".
Donate, back, support, join, or any other synonym for financial contribution
Because different Collectives use different terms, the platform should not try to decide for them. Each community will have its own context. Therefore we have decided to stick with the words "contribute" and "contribution" and add the qualifier "financial" when it's through money.
We used to call recurring financial contributions "subscriptions", but this proved problematic because most Collectives don't think of someone giving $5 a month as "subscribing" to them, and it's also easy to confuse with the concept of subscribing to Updates and getting emails. To emphasize our key action of "contribution" we call it "recurring financial contributions". We are aware this is too long, but we haven't come up with a better idea so far.
Previously, we explored the idea of calling Open Collective branded fiscal hosts (Open Collective Europe, Open Collective UK, etc) "chapters". But this concept was not followed up and supported and using the word is confusing. These are simply Fiscal Hosts.
What's the status of your company?
We are a US based C corp registered in Delaware. We also have created other separate entities to act as Fiscal Hosts, like the Open Collective Foundation 501c3, for charitable Open Collectives in the US and the Open Source Collective 501c6 for open source projects around the world.
Where are you based?
Our team is distributed between New York, Guadalajara, Paris, Brussels, Berlin, and Wellington.
When did you start?
Xavier Damman created the company in May 2015 and raised a first round of $500k in October 2015 (deck). Pia Mancini and Aseem Sood joined as cofounders in January 2016 (Aseem left the company in April 2018). Pia became CEO in April 2018.
Can I see your company budget?
We run our company via mutiple Open Collectives ourselves. You can also see the Collective for the Open Source Collective. We still have some work to do to be even more transparent, and we hope to continue improving in this area.
How much investment have you raised?
We try to be very transparent about our own finances. We raised a total of $2,815,000 so far ($815k on convertible notes in 2015-2016, $2M Series Seed in June 2017).
How do I get in touch with you?
Email firstname.lastname@example.org or join our Slack.
The short version
Setting up a Collective is free, but there are fees if you want to accept and pay out money.
Read on for more details.
Single collective and have a bank account.
If you are a Single Collective and have a bank account where to receive the money, this will be your plan. If you just want to receive money via Stripe - the fees are 5% + Stripe Fees. You can also choose to manage funds you are receiving elsewhere, for example on a PayPal account, another platform, a t-shirt shop, ticket sales, etc. We call this Add Funds and it's free up to $1000. You can also chose to enable bank transfer payments. This means, enabling your contributors to create a pending donation and receive email instructions with your bank details. You can reconcile the donation when you receive it. This is also free up to $1000.
Starter Plan for Single Collectives.
Single collective and don't have access to a bank account for your community.
If you are Single Collective and don't have access to a bank account, you need to apply to a Fiscal Host. If you join a Fiscal Host you don't have to pay Open Collective, pricing depends on each host. Check out the Fiscal Hosts on Open Collective.
An organization and want to create multiple collectives.
If you are an Organization that wants to become a Fiscal Host your plan will depend on how many collectives you host as well as your payments options. If you just want to receive money via Stripe - the fees are 5% + Stripe Fees. You can also choose to manage funds you are receiving elsewhere, for example on a PayPal account, another platform, a t-shirt shop, ticket sales, etc. We call this Add Funds and it's free up to $1000. You can also chose to enable bank transfer payments. This means, enabling your contributors to create a pending donation and receive email instructions with your bank details. You can reconcile the donation when you receive them. This is also free up to $1000. When you reach this limit you'll need to go into one of the paid plans according to the number of collectives you host.
What is a Fiscal Host?
A fiscal host is a legal company or individual who enables financial transactions, holds funds, and takes care of liability and taxes for a Collective. Fiscal Hosts make it possible for Collectives to transact without incorporating their own legal entity. Each Fiscal Host sets its own fees, most commonly 0% and 5%.
More info about Fiscal Hosts.
Cloud SaaS or own servers
Open Source Projects (anywhere)
Open Source Collective 501(c)(6)
5% platform fee + 5% fiscal host fee = 10%
Charity projects (US only)
Open Collective Foundation 501(c)(3)
5% platform fee + 5% fiscal host fee = 10%
Open Collective Paris
5% platform fee + 0% fiscal host fee = 5%
Brussels-based citizen initiatives
5% platform fee + €10/month fiscal host fee
Independent Project, LLC
0% platform fee + 0% fiscal host fee = free
- plus payment processor fees
How are Open Collective's fees determined?
The standard fee for fiscal sponsorship, the service provided by Fiscal Hosts, is 10%. This service is commonly offered by foundations and other organizations who manage funds for unincorporated projects. Open Collective offers not only fiscal sponsorship, but also a great software platform for raising money, paying expenses, record keeping, and transparent budgeting. We charge 5% for Fiscal Hosting (for those Fiscal Hosts that we manage—other hosts set their own fees) and 5% for the software platform (if you put money through the system), so 10% all together. Payment processing fees are determined by the providers we use, PayPal and Stripe.
What about funds flowing outside the Open Collective platform, like manual bank transfers?
If a Fiscal Host agrees to receive money outside the Open Collective system, for example via bank transfer, it’s possible for them to add the funds manually to your Collective so they show up in your budget. There's no % in this case, but the Fiscal Host needs to have a plan that enables it to do it.
Fiscal Hosts managed by Open Collective charge only the regular platform fee and fiscal host fee for manual transfers, but we only agree to do them for large, infrequent payments or special circumstances, because it’s a time-consuming process.
Can I put money through the system and still use it for free somehow?
Yes, it’s possible, up to $1000. To do so, you'd need to set up and manage both the Fiscal Hosting side and the software hosting side yourself. So, you’ll need to set up and maintain your own legal entity and your own servers running an instance of the Open Collective open source software. Maintaining a legal entity involves tax and legal liability, admin overhead, and a lot of paperwork, and maintaining servers running your own software involves a lot of technical skill and effort. That’s why many Collectives find that it’s good value to pay Open Collective to provide these services.
We are a community based on trust, transparency, and contribution. In order to keep it that way, we expect everyone to act in accordance with these guidelines, including all Collectives, Backers, Sponsors, and our own Open Collective team.
Be honest about who you are, what your Collective is doing, why you are fundraising, and what you want to do with those funds. Dishonesty is not only damaging to you, but to all Collectives. Don’t be the one bringing mistrust into this community.
Collectives are groups of people with a shared mission. People may come and go, but the mission remains. A successful Collective survives its initial founders.
The reason we can do great things together is that each of us bring a different perspective. Whoever you are, you have a unique perspective and unique skills to contribute.
We have zero tolerance for trolling or harassment. Being a jerk will not get you a place in this community; it will turn people away. We don’t want that noise in the system.
Your backers want to hear how you are going and stay connected. But please be respectful of their inboxes and their time. The same goes for your interactions with everyone in the community.
If something’s wrong, let us know. We believe in self-managing systems, so we don’t police or moderate much. The only this works is by sharing the effort of noticing what's going on. Contact us any time: email@example.com.
If you like something, share it with your friends. Let the world know and receive some love in return.
These guidelines will continue to evolve as we grow. It’s up to all of us to build an honest, safe and trustworthy community. Thank you for making it real.
Sustainability: We can’t achieve our mission unless we are sustainable doing it. We take a broad definition of sustainability as financial, collective and individual sustainability.
Openness: We work in the open, use public slack, our code is public. We strive to be reachable and welcoming.
Resilience (people come and go) A successful company survives its founders. We try to do things in a way anyone can pick up after and carry on.
Transparency: Our data is public as well as our revenue numbers, our investors update are regularly published in our medium and our salary tiers are published here.
The Open Collective Way
We are on a mission to help collaborative groups collect and spend money transparently.
This section is our core. What our values are, our community guidelines, how we organize ourselves, core contributors guidelines, all the way down to how we compensate ourselves!