Open Collective Europe Forecast

Planning ahead for the fastest growing fiscal host on Open Collective
Growing OCE to support resilience in Europe
Open Collective Europe (OCE) is growing into a strong and independent fiscal host. Our mission is to support the emergence of a more resilient civil society across Europe. Resilient communities don't break due to cascading system failure, they have a patchwork of fallbacks to absorb the shocks. We believe that making it easy and smooth for citizens to organize is vital for civil society. Furthermore, we believe that citizens should not be constrained by bureaucracy when working for the greater good. Regardless of where in Europe you are, we want it to be just as easy to get started with your initiative on OCE.
Our goal is to grow into the third major fiscal host on Open Collective, matching our American sister organizations of Open Collective Foundation (OCF) and Open Source Collective (OSC) in size and ambition. This document serves a double purpose. First of all, it is the actual financial planning document of OCE. This is a living document, it will be updated and added to on our journey towards becoming a major player in the European social impact scene. We will use this document to plan our work, to understand when we need to grow our team or update our plans. Second, this document serves to communicate to the rest of the Open Collective ecosystem as well as our entire community what our goals are for the coming years. We believe in transparency in the non-profit sector, and we believe that sharing our plans and assumptions with the world can only make us stronger.
For those of you who prefer a guided tour through the financial projections I recorded a Loom in December 2022, when I first made this document.
First step: Benchmarking with OCF and OSC
We wanted to understand where the OCF and OSC revenue has historically come from, in terms of collective size. Has there been a “small streams make great rivers” from small and mid sized collectives, or is most of the revenue coming from the larger grants? We defined 5 collective “classes” according to revenue. These classes represent clusters of collectives. For each year, we cluster the collectives so that each cluster’s average revenue is as close as possible to the “reference annual budget” of the collective class. For example in 2020 the average revenue of the
101
OCF collectives in class C was
9,996.84
and ranged from
29,485.19
to
4,111.18
We have excluded 1k Project. Without excluding 1k Project, the revenue of OCF jumps by 10 million in year 4. Since the 1k Project is likely to be a bit of a “black swan” outlier, it seems reasonable to exclude it while benchmarking.
Collective Classification
1
Size
Ref. Annual Budget
OCE Avg. host fee %
Comment
Size
Ref. Annual Budget
OCE Avg. host fee %
Comment
1
A
1,000,000
10%
Large funds
2
B
100,000
8%
Usually grants, sometimes funds
3
C
10,000
7%
Mix of platform & bank transfer grants
4
D
1,000
6%
Usually just platform transactions
5
E
100
6%
Just platform transactions
There are no rows in this table
Chart: Collective classification bubbles by year and host
1
We have chosen to set OCF and OSC “year 0” at 2018, and to set OCE “year 0” at 2022 when JF started working seriously on developing OCE as a fiscal host. We can see that OSC has a very consistent distribution of collectives by class. There are about 2.5 times more class B collectives than class C collectives.
Benchmarks with OCE and OCF
OCF, OSC and OCE are compared through aligning their stages of development based on revenue figures between 2018 and 2022.
Chart: OCF revenue growth benchmark by class
3
Chart: OSC revenue growth benchmark by class
3
We can see that for both OCF and OSC, the vast majority of the revenue comes from A class (funds) and B class collectives. OSC derives a higher proportion of its revenue from C and D class collectives and less from A class funds. OSC derives about 20% of its revenue from C and D class collectives, while OCF derives only about 10% of its revenue from C and D class.
OCE host growth and revenue projections
Chart: OCE projections number of collectives by revenue category
2
Chart: OCE Projections of revenue by collective class
2
Chart: Growth benchmark - first 4 years
2
For OCF and OSC year 0 is 2018, and for OCE year 0 is 2022.
Some collectives have been excluded from historical revenue data:
@1k Project
Our target is to grow at a similar rate for the coming 3 years as OCF and OSC grew from 2019 to 2022. While Europe is a more difficult environment for fiscal hosting, that is hopefully offset by the piggybacking on the Open Collective brand awareness.
Chart: Host fee income
3
Chart: OCE Income
3
OCE team salaries are subsidized in 2023 by OC Inc and by the Cobudget Cooperative through the Swedish fiscal host grant, as the Swedish host is considered a branch of OC Europe.
Chart: OCE Expenses
3
Net to OC Inc is after the salary subsidies have been deducted from the platform share. In reality, the full 50% is transferred to OC Inc and then part of it is paid to the OCE team as compensation.
Chart: Team total hours
3
OCF model calculation
2
Year
Team member
Exec %
Resp.
€ OCF benchmark
€ OCE rate
Modifier
Year
Team member
Exec %
Resp.
€ OCF benchmark
€ OCE rate
Modifier
2023
3
Hugi
40%
4
50.80
35.56
70%
Ivan
0%
2.5
40.00
25.60
64%
JF
60%
4
52.40
33.54
64%
We use the OCF compensation calculator as a benchmark, but OCE cannot afford to pay the same rates as OCF. In 2023 our rates ar 64-70% of OCF rates, if the OCF “personal modifiers” are all set to zero. Our goal is to match OCF rates in 2026, without personal modifiers. According to our current forecast it seems unlikely that OCE will be able to afford to apply personal modifiers, unless we are considerably more successful than we project at finding grants to fund our operations.
OCE compensation vs. OCF benchmark
2
Every year we hope to come closer to matching OCF rates. This could happen faster if we were to secure more grant funding to OCE.
Chart: Liquidity projection and log
1
Our liquidity is not likely to cover more than 3 months of runway for the team. However, as a first party host OCE can also count on support from OC Inc and in extension the more developed fiscal hosts.
Open data
All of the data used to create these interactive graphs are available in this document. For example, if you want to see the graphs including the 1k project, you can toggle to include it (or exclude some other collective) by looking at the table.

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