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Trees not profits: we're giving up our right to ever sell Ecosia (2018)

blog.ecosia.org

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Re: Trees not profits: we're giving up our right to ever sell Ecosia (2018)

#61

Post by HunOL »

stavros wrote: post #12
dwedge wrote: post #8

I'm sure Ecosia are a good company, but headlines like this always make me a little suspicious. Non profits make a lot of money for their founders without it ever being "profit". Ecosia are reporting just over 600K euros a month in wages, I'd love to see the split and what % of that goes to the CEO. You don't need to sell a business if you have plenty of income from it every month - especially if now that can't be ta…

No, but it aligns with the interests of the consumers better if you're actually targeting consumers (for the recurring revenue) rather than burning cash to get as many users as you can lock in, and then selling to someone who will milk them when they have no option.

Yes, but opposite of "maximizing profits" does not automatically imply targeting consumer or better product. In this example they state that they interested in maximizing amount of tree they plant. Cool, good for them, but it's not something I'm interested in when using a search engine. After one of Vivaldi's recent updates, I was asked to try Ecosia as my default engine, and I did, but after a few days I went back to Google.

Re: Trees not profits: we're giving up our right to ever sell Ecosia (2018)

#62

Post by wesselbindt »

stavros wrote: post #16
dwedge wrote: post #14

Earlier quoted context omitted.

That's true, but the product can still get worse chasing revenue from those consumers.

Hm, I've seen this line of argumentation a lot, and I'd like to name it as a fallacy. It's basically "perfect is the enemy of the good", where one good action is dismissed because it's still not perfect. The product will get less bad for me when chasing revenue from me than how bad it will get for me when it's chasing revenue from someone who isn't me.

I see it a lot too, and it's called the Nirvana fallacy [1]. We shouldn't do anything about tax evasion because people will evade taxes anyway (ignoring that you reduce the total amount of tax evasion). We shouldn't ban drunk driving because people will drive drunk anyway (ignoring that you reduce the total number of drunk drivers). We shouldn't trust non-profits, because they seek revenue anyway (ignoring that it's much less severe for any non-profit in comparison to a for-profit company).

[1] https://en.wikipedia.org/wiki/Nirvana_fallacy

Re: Trees not profits: we're giving up our right to ever sell Ecosia (2018)

#63

Post by Novosell »

loufe wrote: post #50
dwighttk wrote: post #36

Earlier quoted context omitted.

I stopped self hosting when my host got blacklisted and I lost about a year of emails with my grandmother… I just thought she was reading them but not having the energy to respond but when I visited at Christmas I saw that all my emails were in her spam box.

The unfortunate thing is that more than any other service, email feels like the one on which I cannot risk to compromise reliability. This sort of story (thank you for sharing) unfortunately fits with my own experience managing my University's undergraduate society's local email server. Non-stop headaches and complete indifference from every group which affects your setup.

Same here about not wanting to compromise on email reliability. I self host most things, run Linux, DDG, custom rom without Google Play, etc etc.

But I've still got my @outlook.com email address.

Re: Trees not profits: we're giving up our right to ever sell Ecosia (2018)

#64

Post by ghaff »

motbus3 wrote: post #40
dwedge wrote: post #8

I'm sure Ecosia are a good company, but headlines like this always make me a little suspicious. Non profits make a lot of money for their founders without it ever being "profit". Ecosia are reporting just over 600K euros a month in wages, I'd love to see the split and what % of that goes to the CEO. You don't need to sell a business if you have plenty of income from it every month - especially if now that can't be ta…

I would love to see it too. Also relations with for profit companies as well. But how much a CEO of a company like this should make? It seems quite lot of work and one needs to make a living. But how much would be fair in your opinion? I honestly have no idea

In the US, the CEO/executive director of a mid-size non-public company would probably expect a few hundred $K/year. Which isn't starvation wages, especially by European standards, but is something a lot of individual contributors in Silicon Valley would consider a relative pittance. And toss in no equity.

Re: Trees not profits: we're giving up our right to ever sell Ecosia (2018)

#65

Post by guhwhut »

mapt wrote: post #51

We have legal structures with which to make statements like this about nonprofit status, structures which bind the promise so that we don't have to take your word on it.

They've used those, this is a blog post for humans who care more about the intent from the ceo rather than the specific legal frameworks.

Re: Trees not profits: we're giving up our right to ever sell Ecosia (2018)

#66

Post by guhwhut »

hoseja wrote: post #59

Trees don't need planting. Trees need a safe place to grow without saplings getting destroyed. But trees absolutely don't need planting. Besides, a healthy forest has to go through pioneering stages first.

As a forest land owner, trees absolutely need planting. Then they need to be protected from humans and deer and invasive species and disease.

Many trees fail to grow. Most people would be astounded at how many trees don't make it.

Re: Trees not profits: we're giving up our right to ever sell Ecosia (2018)

#67

Post by HenryBemis »

fadesibert wrote: post #53
dwedge wrote: post #8

I'm sure Ecosia are a good company, but headlines like this always make me a little suspicious. Non profits make a lot of money for their founders without it ever being "profit". Ecosia are reporting just over 600K euros a month in wages, I'd love to see the split and what % of that goes to the CEO. You don't need to sell a business if you have plenty of income from it every month - especially if now that can't be ta…

I'm not sure how much that's creating outsized income for the founder... There are between 98 (2022 annual report number) and 120 (ZoomInfo) and 133 (LinkedIn number). German filings are notoriously opaque vs Europe or UK. So that's 637k EUR / 120 employees (although the payroll number jumps around between 450 and ~640 - weird, but who knows, # of employees shifting around or some paid quarterly or on commission?). T…

> That's around 5,300 EUR / month per employee

If the salary is 4300 (instead of 5300) per employee for those 120, that would give the CEO the extra 120x1000 per month.

I am not implying the CEO does that, I am merely saying that "non-profit" is a relevant term and unless supervised/regulated can become a big earner for one/some/all of the staff.

Unless they report all salaries (anonymised) and this would be signed-off by an independent/external auditor (give 20k per year to one of the Big4) we would be somehow certain that there isn't a hockey-stick graph (with the CEO and his wife/husband/son/etc/) getting 70% of the salaries for 3 people versus 30% of the salaries for the 117 people.

Re: Trees not profits: we're giving up our right to ever sell Ecosia (2018)

#68

Post by scarfaceneo »

jksflkjl3jk3 wrote: post #55
andy12_ wrote: post #52

Earlier quoted context omitted.

Because ad revenue can be used for the non-profit? Ecosia's whole thing is that when you use it, you indirectly help plant trees - "the search engine that plants trees".

Do they disclose what percentage of their revenue is donated? If it's just a token amount, then I'd rather not support a marketing gimmick and would prefer to just donate directly to an organization focused on trees. If it's a significant amount, then it seems unlikely that they'll be able to compete with for-profit alternatives that can focus on developing the best product.

You can donate to an organisation and use their search engine.

Re: Trees not profits: we're giving up our right to ever sell Ecosia (2018)

#69

Post by stavros »

wesselbindt wrote: post #62
stavros wrote: post #16

Earlier quoted context omitted.

Hm, I've seen this line of argumentation a lot, and I'd like to name it as a fallacy. It's basically "perfect is the enemy of the good", where one good action is dismissed because it's still not perfect. The product will get less bad for me when chasing revenue from me than how bad it will get for me when it's chasing revenue from someone who isn't me.

I see it a lot too, and it's called the Nirvana fallacy [1]. We shouldn't do anything about tax evasion because people will evade taxes anyway (ignoring that you reduce the total amount of tax evasion). We shouldn't ban drunk driving because people will drive drunk anyway (ignoring that you reduce the total number of drunk drivers). We shouldn't trust non-profits, because they seek revenue anyway (ignoring that it's…

Nice, thanks for the name! Your examples are also spot on.

Re: Trees not profits: we're giving up our right to ever sell Ecosia (2018)

#70

Post by stakhanov »

nbadg wrote: post #60
stakhanov wrote: post #43

Earlier quoted context omitted.

I looked up the bylaws just now (mostly because I'm procrastinating). It looks like they have a gGmbH that owns 99% of the shares (by number of shares), but founders retain 99% of the voting rights. Founders' shares are barred from receiving dividends, and the gGmbH has veto rights in relation to any certain changes that would fundmentally alter this ownership structure.

Something I don't really understand, maybe you have thoughts: is there a benefit to gGmbH over the company being a wholly-owned subsidiary of a Stiftung?

They have a brief paragraph here [1] that indicates they considered these and decided against it: "The team considered several alternative ownership solutions to address these questions, including converting the business to a German non-profit and establishing a foundation. Both of these solutions had constraints, though, and neither offered the mixture of entrepreneurial flexibility and structure security they sought."

Stiftung (Foundation) generally work well if you have a bunch of money and you basically have a fixed "algorithm" that you want to execute around the money like: "Invest it all into an index fund, and in any year in which the fund returns a profit, pay out the profits to the family members of person X in the same ratios that would apply if those people came into X's inheritance". You then appoint a bunch of lawyers to serve as the board of the foundation. Because the "algorithm" is so precisely defined, the set of circumstances where the lawyers do their job wrong will be well-defined, and will constitute a breach in their fiduciary duty. There's basically no room for making entrepreneurial decisions along the way. It's a bit like taking a pile of money, putting it on a ship, putting the ship on autopilot, and giving up any and all direct control of the ship. Depending on what precisely that "algorithm" actually is, this might get you tax advantages. Or it might create non-financial positive outcomes you might be trying to achieve like making sure that your progeny will continue to enjoy the wealth you created for many generations to come while limiting the probability that any one generation can screw it all up for the later generations.

Social entrepreneurship is different from that: A social entrepreneur wants the goodwill and favourable tax treatment that comes from giving up their claim to ownership of the money generated by the business (this is what the gGmbH status does; it's a bit like 501(c)3 in the U.S.) -- But they want to retain control over the business. They want to make entrepreneurial decisions as they go, changing strategies along the way in whatever way they please, without restricting themselves too much to the execution of any predefined programme.

[1] https://purpose-economy.org/en/companies/ecosia/

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