[HCoop-Discuss] Financial situation

[Nathan Kennedy]

Adam Chlipala wrote:
> Franklin Gordon Bynum wrote:
>   
>> On 04/30/2007 12:02:46 AM, j.c.hallgren at juno.com wrote:
>>   
>>     
>>> As far as I'm concerned, I AM looking at this as a business, and the  
>>> fact that it's a coop is a minor detail...
>>>       
>> It doesn't matter how you look at it.  It's a co-op, not a business  
>> selling you a service. You can keep telling yourself that it's a  
>> business, but that won't change anything.
>>   
>>     
>
> It's probably worth reminding everyone that we have a good number of 
> members who joined before we had any formal legal structure, J.C. 
> Hallgren among them.  He didn't sign up as a member of a co-op.  He did 
> have the option to leave when we became one in the eyes of the law, but 
> let's not be unrealistic in our expectations of how inertia leads people 
> to keep doing what they've _been_ doing.
In my view cooperatives and businesses are mostly overlapping sets.  We 
are a cooperative and a business--a cooperative business.  According to 
our founding document (articles of incorporation), we are incorporated 
as a nonprofit corporation for the purpose of "provid[ing] Internet 
hosting services for the mutual improvement of its members ..."  In 
other words, we are a business sans profit motive.  As the old credit 
union saw goes, "not for profit, not for charity, but for service."  The 
cooperative or business angles may be more or less important to one 
member or another.  But a lot of the same principles that are required 
for business success carry over to cooperatives.

A lot of things we've done so far have been sloppy from a business 
perspective, and for the most part that's been okay since we've focused 
pretty well on our core objectives.  But for us on the board, especially 
with bigger undertakings and more members joining, have to remain 
conscious of our stewardship of HCoop assets.  Our volunteer admins have 
donated a lot of their valuable time for the benefit of all HCoop 
members.  But also, each month that goes by with the Peer1 servers 
unutilized is a pool of member money that goes wasted.  I'm sure we're 
still well before the point at which we'd have saved money by 
contracting out to a full-time professional (and a lot of full-time 
professional contractors are a lot less competent than our admins), but 
we should not be cavalier about missed deadlines.

Anyway I am wandering a bit.  My point was that I do agree with jch that 
HCoop is a business, although to myself and most of our members it is 
not 'just' another business.  Where I do take issue is with jch is the 
idea that we're charging members more just so we can grow.  That's 
nonsense.  Growing may briefly require us to charge members more, but it 
will ultimately allow us to provide much better service for a much lower 
rate.  Compare our service now to the situation when we had a couple 
dozen members on Abu.  We had a crappy network, limited bandwidth, an 
increasingly vintage box, and everyone paid two or three times as much.  
I expect once we've grown into Peer1 more, rates will get back in the $5 
range before too long, and we'll be on a worldclass network, have 
hardware RAID and all the various goodies that we've got there (such as 
cheap, topnotch bandwidth, unlimited IP's, etc).  And the ability to 
provide things like VPS and so on.

Maybe a few people think we should have stopped at Abu, capped off 
membership at 50 or less, and not sought any sort of legal structure.  
There's a few other groups that do the same thing.  There are advantages 
to being a clique, but professional-quality service is not one of them.  
Looks like about a million other emails just came in so I'll finish off 
this email for now.
-ntk