[hackerspaces] what is your opinion about the closing of 3rd ward?

Tue Oct 15 05:46:30 CEST 2013

I think that the question of 501c3 vs LLC or whatever is a red-herring.  I
think that there are advantages to 5013c status but that it takes a lot of
work and it's always up-in-the-air whether that work is the most-worthwhile
work to be doing.  Especially given the increased oversight and
accounting-overhead involved in being a 5013c.

Not that I recommend having bad accounting, but I recognize that it's work
and might not always be prioritized.

The question of "values" or "mission-statement" really should be separate
from the question of "5013c vs LLC" -- the latter is about how you
represent yourself to the IRS (or equivalent), whereas the former is about
the way you go about your day-to-day business, think about what you do, and
represent yourself to the community.  I would be sad if folks noticed that
Parts and Crafts was not 5013c and concluded, consequently, that we were
profit-motivated, when in fact we are "try to avoid bureaucracy"-motivated.

I also caution against adopting too-strong of an ethical stance towards
various modes of organizing.  Among other things, there are lots of folks
in the hacker community that are really into idealistic versions of
free-market capitalism and who can make reasonably cogent arguments that
the profit-motive can be a powerful and creative force for good.  I don't
want my space to be organized around the idea of "profit" or "investment",
but I recognize that a space that is (TechShop?) organized around the
profit-motive might ultimately be a Good Thing.  And might, further,
ultimately, be a bigger Good Thing than my little organization.

It's the specifics, and the culture, and the on-the-ground
how-things-are-managed that actually make a space Good -- hackerspaces
(even the biggest ones) aren't big enough for institutional policy to
matter more than individual people trying their best.

I think that, ultimately, you have to answer questions around size (small
to large), outward-facing-ness ("me and my friends" to "everyone who might
want to make a thing"), governance (community-consensus to
benevolent-dictator) on the community side, and then have to answer
more-or-less 2 questions on the financial side ("how much money do we
spend?"  and "how much money do we make?") and hope that those answers end
up being approximately the opposites of each other.

Lots of different, effective, good, and working models at all points on all
of the spectrums.  But probably more ineffective, terrible, broken ones.  I
think it's both hard and not-that-hard, because stuff happens and you deal
with it as it comes.

Actually, that's one of my biggest frustrations with the 3rd Ward thing --
the suddeness of the announcement.  If p+c was going to go bankrupt, we'd
know at least 6 months ahead of time (I know, because we were really close
to doing so last year!)  The idea of suddenly-out-of-the-blue informing
your members of a closing infuriates me because it strikes me as incredibly
irresponsible to know that your organization is in shaky financial straits
but not mention this fact to your members.  And, additionally, incredibly
dumb to know this and not ask your members to help you out.  Hackerspace
folks are really smart, competent, motivated people who will help you think
your way out of a jam if you let them.

And a lot of them are reasonably-highly-paid engineers, which, you know, is
useful if you're organizing a community space that needs some cash
sometimes.

This is an aside of sorts:  Don't try to start a makerspace to make money.
 Really don't.  It's a terrible idea.  I alluded to it before.  Don't try
to sell the idea of "doing it yourself" to a community of people who are
more-or-less already doing-it-themselves.  They don't need you.  You have
very little to sell them.  Figure out what they want and find your place in
the community and plausibly figure out how to make a living in that place,
but don't imagine "Makerspaces" as some big new investment opportunity.
 It's really, seriously, unlikely to pan out.

(I say that, knowing full well that Home Depot was one of the best
financial investments of the last 30 years, and more-or-less found its
success riding the 70's "do it yourself" home-building movement --
obviously there is, in fact, money to be made here!)

On Mon, Oct 14, 2013 at 5:41 PM, john lunger <justj1915 at yahoo.com> wrote:

> My opinion:
>  We are planning to start a new hackerspace in Hayward, CA.
> I can't tell you how many people kept coming to me to NOT make it a 501c3.
> I am not sure what their issue was but I had to reiterate that it was NOT
> going to be for-profit.
> One guy started yelling at me and saying that I need to make him some head
> chief of marketing or promotions and it has to be some kind of LLC or
> whatever. It was crazy.
>
> Anyways, lots of people just don't get it and see it as a money making
> machine which is not the case. Is it just plain greed?
>
> I am worried in the sense that I hope it never bankrupts us but don;t plan
> to grow big too soon. I want to take things slow and easy and one step at a
> time. I want to be sure that it can be sustainable. Ideas to prevent this?
>
> Carolyn
>
>
>   On Monday, October 14, 2013 10:35 AM, William Macfarlane <
> wmacfarl at gmail.com> wrote:
>  Right, and 3rd Ward's mistake is probably not that they discontinued an
> unsustainable membership practice (obviously unsustainable practices need
> to be discontinued or modified), it's that they did so with little-to-no
> explanation and in a way that alienated many members of their community.
>
> A lot of what a co-working space is selling is community (and 3rd Ward was
> as much co-working space as anything else), so any management decisions
> that are harmful to the sense of community of the space make the product
> less desirable.
>
> Running a co-working space as a business is super-duper hard, and probably
> just a bad idea.  I think it ultimately turns out that there's not a lot of
> money to be made in shared artist/coworking spaces, since your target
> market is poor and self-starting and reasonably able to form their own
> little co-ops that suit their own needs.
>
> Blending co-working, tool-library, and class-running as various kinds of
> ways to make money to keep the space running works better, in part because
> you just get a lot more utility out of your building (different kinds of
> users using it at different times), but also because it makes the space
> feel like one big community.
>
> This is something that Artisan's does well that 3rd Ward (I think) did
> poorly -- the sense that all of the different kinds of users and members
> are variously and legitimately part of the community, and all the parts are
> integrated together.  It's cool to take a class at Artisan's in part
> because the resources are tremendous and the instructors are good, but it's
> at least as important that the class is _in Artisan's_, and when you come
> you get to wander around the space a bit, see lots of fun and interesting
> people, many of whom are your friends and many of whom you wish were your
> friends, making really cool things that you wish you knew how to make.
>
> The "take free classes" "pro" membership at 3rd Ward might have been a
> terrible financial decision, but this sort of option does a few neat
> things.  It creates a membership tier that means "I'm really super-into
> this organization", and does so in a way that creates a sense of
> belonging-and-ownership.  There are some problems with this sense of
> ownership/entitlement, but I think, at core, the informal "this is my
> place" sense is really great and important as long as it's connected with
> "I need to help it keep working."  The other thing that this kind of
> membership does is it encourages long-time community members to take part
> in classes, which are frequently the ways that new people get involved.
>  This is neat because connecting new folks to older folks is the best way
> to help new folks feel welcome!
>
> I wonder whether a "take free classes" membership policy might be
> profitably changed into something that fulfills these goals without being
> an economic disaster.  Something like "if, 1 day before it starts, a class
> isn't full, then a certain tier of member can take it for free" so that
> your free class-takers are neither pushing out payers, nor causing lots of
> extra classes to be run.  This doesn't work for some classes, which will
> always fill up, but maybe that's okay.
>
>
> On Mon, Oct 14, 2013 at 10:23 AM, Gui Cavalcanti <gui at artisansasylum.com>wrote:
>
> One interesting piece of information that's pertinent to everyone that
> came out of this is that they were offering a membership with unlimited
> classes built into it - and, furthermore, that the removal of this offering
> after several years is one of the things that got everyone in an uproar.
> When the asylum offered an unlimited class pass, the members who used it
> ended up using 2x the price they paid for the pass in a year in payments we
> had to make to teachers - luckily, we kept the experiment small, and it
> didn't cause any serious harm. Given that 3rd Ward and the Asylum were of a
> similar size (programmatically and physically) I can see no possible way
> such a business plan/offering could've worked out in the long run.
>
> Navigate such discounts and deals at your own risk, especially as they
> become standard offerings in your space.
>
> Florencia Edwards <floev22 at gmail.com> wrote:
>
> Managing  a makerspace or hackerspace is soo hard. I think that this
> happening put the fact out there that its hard and requires subtle work and
> communication. Before this i thought only our makerspace struggled with
> money ,prices ,and how to make everyone welcome but not go bankrupt for not
> charging. This makes me realse we are not alone and that we can learn from
> this mistakes.
> El 13/10/2013 20:33, "William Macfarlane" <wmacfarl at gmail.com> escribió:
>
> Yeah, I guess my question was whether there could be a trick of
> contract-law that resulted in giving membership refunds priority over other
> debts.
>
> I did forget about personal guarantorage, which is a foolish thing to
> forget about since I'm the personal guarantor on the line for my space.
>
>
> On Sun, Oct 13, 2013 at 7:24 PM, Arclight <arclight at gmail.com> wrote:
>
> There are a few problems with choosing who to pay if you close down.
> First, it's become common for corporations, including non-profits, to need
> personal guarantors when they sign leases or pretty much do anything these
> days as a startup.
> Not paying the later rent check might leave your "angels" in a big
> financial mess.
> Secondly, if you actually need to declare bankruptcy, you absolutely
> cannot give preferential treatment to anyone. The court decides who will
> get what share and when, regardless of what you think is equitable. If you
> accept a preferential payment, you can be forced to give it back later.
> And I do agree that not having "the money talk" early and often is the
> surest way to fail.
> Arclight
>
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> --
> -Will
> www.partsandcrafts.org
>
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> www.partsandcrafts.org
>
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-- 
-Will
www.partsandcrafts.org
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