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The October drive was a massive success thanks to your generosity! The staff and volunteers of the Organization for Transformative Works are in awe not only of the amount of money raised but also the thoughtful discussions that took place during the drive.

One question raised in those discussions is: what are we going to do with the extra money? We were also asked why, if our goal was US$70,000, didn’t we stop there?

There are multifaceted answers to both. The shortest and most direct have been given in the comments on the news posts for the drive; we’ll invest more money in servers, in staff training, and in consultants to back up our all-volunteer staff. Raising money beyond our initial goal allows us to do all of those things along with paying our bills until our next scheduled drive in April (and beyond). It also lets us grow our "rainy day" reserve for emergencies.

The longer answer means digging into a little of the structure of OTW and the history of our fundraising.

As you saw in post seven of the drive, a nonprofit organization like the OTW has many expenses. About 70% of our budget goes to hosting, servers, and other things to keep the AO3 up and running. The other 30% is spread among our other projects, services, meetings and general administrative costs.

While we’ve always been able to cover our expenses, there have been times when it was close. AO3, our major expense, has grown exponentially—and quite frankly, we weren’t sure what to expect in the early years. Now we have a better handle on our needs, and over the past three years, we’ve refined our fundraising plans to be more mindful of growing our income to match the growth of our expenses. Think of it as the OTW going from "living from paycheck to paycheck" to having a regular household budget, a safety net, and some extra funds to be able to do more good.

Our goal of US$70,000 was what we thought was attainable for us. Our last October drive had raised US$52,381, so we were prepared to fall short of the goal, even if we had been able to bring in more than last year.

We were not prepared for the overwhelming success of this drive. In fact, we expected to have to dip into our reserve fund to get us through the end of the year and help keep us afloat until our next scheduled drive, in April 2015. This isn’t uncommon for a nonprofit, especially one as young as OTW, but also not a strategy we could sustain long-term. Discussions began in August about expanding our fundraising plan to include major donor solicitations, more methods for monthly donations, and adding one or two special events to supplement our annual drives.

We will still be looking into those things, because they are part of a solid and diverse fundraising strategy, but the immediate pressure has eased thanks to nearly 8,000 donor who came through for us this October. Simply put, our finances are stronger than ever, and that means strengthening all of the projects under the OTW umbrella.

Anticipated expenses, in brief:

  • US$45,000 will be used to add additional servers in 2014, with at least US$100,000 in additional machinery in 2015.
  • More servers mean more space for colocation and higher power costs for those servers, expected to total US$36,000 or more in 2015, with an additional US$25,000 for a tertiary colocation site, analytics, and domain registrations.
  • An improved ticketing system for our Abuse and Support teams will cost an additional US$400 per month, a total of US$4,800 a year.
  • Training seminars and workshops for staff will be available from a pool of at least US$7,500, with another US$7,500 set aside for travel, lodging, and registration fees for presentations at fan cons, academic conferences, and other events.
  • An in-person meeting for the Board will take place in October, with possible attendance by chairs and/or other personnel, at an average of US$950 for travel, lodging and meals per person, estimated at US$15,000.
  • US$8,000 will cover routine administrative expenses, and other program expenses will require a minimum of US$23,000.
  • A nine-month cash reserve for emergencies of approximately US$72,000 will be maintained.

Beyond these immediate expenses, it’s difficult to pin down specific expenditures for 2015. As we mentioned above, we expected to go into next year with a smaller reserve and with modest growth in our income. Most of our concrete plans were built around those numbers. Committees are being asked to submit additional requests in November, but there are a few areas where we expect to increase funding.

We’ve talked about the immediate impact for AO3 in terms of additional servers and rack space, contract employees, and training. Fanlore and Open Doors will see some tangential benefits just from sharing the same server space. The upgrade in software for AO3 Support and Abuse will also make it easier to respond to user inquiries about Open Doors’ preservation work.

Our other two major projects, Transformative Works and Cultures and the legal advocacy work of our Legal committee, run on significantly smaller budgets than the AO3. Our legal team incurs filing fees from time to time along with the costs of traveling to hearings and meetings related to fair use. The staff of TWC, our academic journal, travel to academic conferences across the U.S.; another expense is the annual registration fee for the journal. The budget surplus created by this drive will allow them to represent OTW at more events, and for members of both committees to join Development and Membership—the committee behind our fundraising—in their plans for increased outreach at fan cons.

All of our projects and committees will benefit as well from more money to support staff and volunteers in attending more trainings, seminars, and webinars. Strengthening professional skills and connections across the OTW has always been a priority, whether it’s taking advantage of a management workshop for Volunteers and Recruiting or sending staff to participate in events like AdaCamp.

All of these areas are places in which we can grow thanks to the success of this drive and the generosity of our members. We expect to give an update on both the annual budget and our fundraising plan for 2015 by early January, so watch this space.

We’ll have another fundraising goal in April, and we hope that fandom will come through for us again. Remember: we’re only as strong and as vital as you, our users and members, make us.

Here’s some more details for all the number geeks among you:

Monthly expenses, recurring:
Regular monthly expenses as of 30 October: US$5,497.20
Monthly average expenses estimate for 2015: US$8,066.66
(Includes server colocation, routine program and administrative expenses paid every month)

Total anticipated expenses from 1 January to 30 March:
First quarter expenses, 2015 adjusted estimate: US$84,949.67
(Includes regular monthly expenses plus US$60,000 server purchase and preparation for the April fundraising drive; minimum amount we must have on hand)

Reserves:
9 months of reserves, 2015 estimate: US$72,599.94
(Based on regular monthly expenses; amount held to "keep the doors open" as we are, without growth, during emergencies)

Expenses plus reserves
First quarter expenses plus reserve, 2015 estimate: US$157,549.60
(Amount we must have on hand on 1 January to carry us through to 30 March and maintain 9 months of reserve funding)

Surplus talk:
Carry over: US$197,544.09
(Assumes we meet November and December fundraising goals and spend remainder of 2014 budget; this is the total amount of money we’ll have on hand on 1 January)

Surplus: US$39,994.48
(Amount remaining after 2014 budget is met, first quarter expenses, and reserve goal are met)

Preliminary budget talk, 2015:
We expect our 2015 budget will be (rough estimate): US$230,000
This number includes hardware purchases as well as regular monthly expenses, in-person meeting, staff development and outreach fund, and more.

Thank you for your support—your generosity makes our work possible.