We’ve spoken earlier than about Lichess’s moral stance and the way we do “business”. Indeed, on the backside of this and each different of our weblog posts there’s a quick clarification:

Lichess is a charity and fully free/libre open supply software program.
All working prices, improvement, and content material are funded solely by person donations.

We aren’t going to give attention to that facet once more (a minimum of not right now), however as a substitute make clear what it means to be a non-profit or a charity, because it’s clearly a message that should get on the market extra:

Stick with us by way of the definitions!

Non-profit: no web revenue (revenue past bills) will profit any particular person.

This is in distinction to most companies the place both personal homeowners or public shareholders acquire monetary advantages from the earnings of the enterprise.

Charity: an organisation with philanthropic targets, aiming to enhance a neighborhood ultimately.

Of course, exact authorized definitions will range by nation, and technically Lichess is a French affiliation — which encompasses non-profit standing and charitable standing — with a aim to “promote and encourage the teaching and practice of the game of chess and its variants”.

Definitions over, onto the primary article!

A standard false impression we see is that our non-profit standing means Lichess is barely surviving. After all, an organisation with out revenue is a nasty organisation, proper? No!

Profit is a mechanism the place people (homeowners or shareholders) syphon off worth from an organisation for his or her private acquire. For a non-profit, we are able to generate the identical revenue as a for-profit firm, however the important thing distinction is that all of that revenue goes again into the organisation, to maintain it rising, preserve making it higher, and in our case preserve it free.

There is a number of rhetoric about how companies can do extra for the neighborhood, by advantage of being for revenue. But in actuality, a non-profit is placing 100% of its revenue again into the neighborhood. The absolute quantities could also be completely different, since a smaller share of a bigger complete revenue can nonetheless be extra total, nonetheless for equal revenue a non-profit is by definition doing extra (or a minimum of ought to be!).

Lichess additionally generates (nearly) all our revenue from donations, however in idea, a non-profit may have a subscription/paywall mannequin and presumably generate far more revenue (don’t fear, we gained’t). The cause we don’t use that type of enterprise mannequin isn’t {that a} charity couldn’t use it. Instead it’s as a result of we expect it’s a unhealthy mannequin for attaining our aim of selling chess.

The remaining wrinkle within the definitions is that it’s attainable to be a non-profit however, like FIFA, nonetheless take cash out of an organisation in different methods. Rule-abiding non-profits (akin to Lichess) additionally pay salaries to workers. We publicise these at lichess.org/prices so you’ll be able to see whether or not these are consistent with market charges and cheap.

Lichess has plans to develop into a better class of charity inside France – and a few of what we have executed over the 12 months is to analysis and start that multi-year course of. We will give an replace on that, and our charity’s plans, later this 12 months.

Thanks for listening to our TED speak!