Over the past year I have been working with the Drupal Association to build an organization that not only supports and fosters the growth of the Drupal community but also one that the Drupal community can be proud. In this post I would like to address the transparency around the Drupal community’s largest financial event; DrupalCon. In just a few short years this event has grown from a small handful of people to a million dollar event and we have expanded our reach by beginning to work outside of the United States and Europe. It is vitally important to the us that we continue to build trust with you, the Drupal community.

Recently there has been some online chatter about the production of DrupalCon, DrupalCon Chicago, and how decisions about the conference are made. I’d like to address these directly and open up a candid and frank conversation with our community. If after this post you are left with questions feel free to post in the comments or attend the next Drupal Association Town Hall meeting on July 22nd, 2011 online and live in Portland, Oregon.

Who manages DrupalCon?

The first topic that I’d like to discuss is how DrupalCon is produced. Until 2010 each DrupalCon was an independently produced event that was led and ran by a group of highly dedicated volunteers and a sponsoring company. These companies not only donated huge amounts of their employee’s time but they often provided (or created) the legal entity that would host the conference. Typically this donation of time and services was done on top of their financial sponsorship of the conference (an absolutely astonishing outpouring of goodwill to our community). Early on we recognized that this model was not sustainable as attendance of the conference was growing rapidly, so after DrupalCon DC we began the work to modify the structure of how conference were run.

A new legal entity was formed to host DrupalCon: DrupalCon Inc. (DCI). In August of 2010 this entity was formally recognized as a U.S 501c3 non-profit. This non-profit is not controlled nor managed by Drupal VZW (i.e. the Drupal Association), which is a Belgium non-profit. DCI was created in the best interest in community as it has allowed hundreds of thousands of dollars not paid in taxes to be reinvested in the community. Read more about the history of DCI and browse its financials.

The Drupal Association (legally known as Drupal VZW) is a Belgium non-profit. When you become a "member" related to Drupal, currently that is the organization you are joining. Although Drupal VZW does not run DrupalCon, the two organizations often work very closely together because we believe that it's in the best interest of the broader Drupal Community to do so. DrupalCon is an educational event for the entire Drupal Community.

Currently, DCI and Drupal VZW are in discussion about how these two organizations can work together to better serve the Drupal Community.

Let’s talk about DrupalCon Chicago

DrupalCon Chicago was the community's most production-intensive event to date. With the first budget of over a million dollars, the introduction of a hotel-based venue, the exhibit hall day stage, an official conference party, and many other new-to-DrupalCon pieces it was clear that we would need additional help. At the same time the organization of DrupalCon was shifting to DrupalCon Inc. who has just begun to hire full-time employees in November of 2010. DCI would eventually take over full management of the conference. These hires occurred about a year after the planning for DrupalCon Chicago began.

As previously mentioned, past DrupalCons had been significantly subsidized by companies like Acquia, Development Seed, Chapter Three, Commerce Guys, and GVS, who donated many hours of work and provided services at significant discounts in order to ensure that events were not only successful, but also as affordable and accessible to as many people as possible.

To help produce and organize DrupalCon Chicago Palantir.net stepped forward to help with the organization of DrupalCon Chicago.

If you don’t have time to look up the details, two employees of Palantir.net sit on the board of Drupal VZW. Drupal VZW has absolutely no control over DCI, but the Board of Directors of DCI always independently considers the advice and counsel of Drupal VZW, which represents many of the beliefs of the broader Drupal community.

It is important to us to openly discuss the intimate details of this relationship with Palantir.net and DCI.

Swimming into the details

Putting on a DrupalCon requires an absolutely amazing amount of work. DCI not only runs the longest, most involved OSS conference, but also one with the most moving parts: pre-conference trainings, business summits, well over 100 speakers, thousands of attendees, a giant party, evening events, a 24-hour coder lounge, code sprints, and so much more. In Chicago, there was even a wedding!

To pull this very complex event off, DCI relied on over a hundred volunteers that dedicated both personal and professional time to the conference. We as a community owe all of these individuals a great deal of gratitude.

DCI also used the time and services of Palantir.net, who really stepped up to the plate and helped save the conference tens of thousands of dollars by providing professional time at heavily discounted rates.

In exchange for the professional services Palantir.net rendered to DCI with respect to the conference, DCI provided Palantir.net with a Diamond sponsorship of DrupalCon Chicago at the $45,000 level.

This was an in-kind transaction, which means that DrupalCon did not pay Palantir.net for their time and Palantir.net did not pay DrupalCon for their sponsorship, though the two organizations did have a formal, written contract.

Diving Deeper

This is not the first time that DrupalCon has paid one of its major sponsors or a company from the organizing team, and it is certainly not the first time we have paid for work to be done. Overall administrative overhead expenses (event planning, website, project management, graphic design, accounting and sponsor coordination) for DrupalCon Chicago were $198,469, inclusive of staff time, all vendors, including Palantir’s sponsorship. By comparison, DCI spent $184,614 for the same work at DrupalCon San Francisco.

This is how it breaks down:

ChicagoSan Francisco
Staff 59,837 Staff 0**
Sponsor Coordination 0* Sponsor Coordination 14,595
Event Planning 68,492 Event Planning 65,991
Website Development 29,880 Website Development 56,373
Project management 15,000 Project Management 35,520
Graphic Design 15,000 Graphic Design 5,792
*Staff handled sponsor coordination

**As a new organization DrupalCon Inc.
had not yet hired staff.

Palantir.net’s contract with DCI covered three line items:

  • Website Development
  • Project Management
  • Graphic Design

Palantir.net also served as the conference lead setting the tone and direction, although they were not contractually obligated to.

Conference over conference, Palantir's services saved DrupalCon over $52,000 reducing the costs for the same three line items from $97,685 to just $45,000. However, since the transaction was done in-kind, the actual cash cost to DrupalCon was even less, because sponsorships are designed to subsidize ticket prices.

This in-kind transaction benefited the conference and the Drupal community.

Keeping the records

As part of the sponsorship trade Palantir.net signed a contract with DCI for a minimum number of billable hours (500 hours), already at a below-market hourly rate, and a requirement to submit hourly reports. In return, Palantir.net only received the Diamond sponsorship and no cash payments.

The hour breakdown (click for details) is as follows:

Sept 685
Oct and Nov 542.4
December 301
January 428.5
February 305.25
March 47*

*On-site management at the conference was not billed/tracked

In total 2,309 hours were exchanged for a sponsorship worth $45,000, making the billable rate approximately $20/hour, significantly below market rate. Considering that the cash cost to service the sponsorship, the net cash flow impact to DrupalCon, Inc. was even less.

Wrapping this up

Putting on a DrupalCon requires an incredible amount of time and effort by hundreds of individuals. After each conference we review and evaluate our processes and our decisions. As the Executive Director of DrupalCon Inc. and the principle in the decision to contract with Palantir.net. I believe that we made the right decision in offering Palantir.net a sponsorship in exchange for their work.

With that said we think that there is a perception problem. Although the sponsorship in-trade was financially beneficial for the conference and the community and everything was kept above the board, it may not look that way. In retrospect, we could have disclaimed this earlier, been more public, and potentially created a sponsorship distinction for in-kind transactions.

We took these lessons forward with us to London and Denver. For example, you'll notice on the DrupalCon London site Deeson is listed as providing the Creative direction and site design. This is because they are donating a significant portion of their time, being paid at below-market rates for part of their time, and have taken responsibility for all creative direction, graphic and site design. This is a small way that we can thank them for their generosity while also maintaining equality and fairness with our sponsor base.

What do you think?

We want to hear from you. If you have any questions or suggestions please let us know in the comments, contact us, or attend the upcoming Town Hall Meeting. Your feedback is appreciated.

Move forward with us

The folks at the Drupal Association and at DrupalCon Inc. are dedicated to supporting you, the amazing folks of the Drupal Community. We are here, we are listening, and we are constantly adjusting.

Grow with us as we learn how to best serve and support you.

Comments

webchick’s picture

I think when people note a lack of transparency within the DA, some jump to the conclusion that this implies corruption or other sorts of nefarious dealings. In reality though, this stuff doesn't get talked about nearly enough because board members for the DA and DCI volunteer their time, and under our current governance structure, we're also charged with making sure a number of different fronts are being taken care of: Drupal.org improvements, infrastructure, fundraising, etc. There's difficulty finding time in the day to make sure those important things even happen, let alone finding time to talk about it. :\

However, we're making steady improvements. We're hiring staff to make sure this stuff gets taken care of. We've re-tooled our governance structure to be more sustainable and provide more direct community control. And we're actively working on a number of other transparency initiatives, like making the board meeting minutes public.

Thanks for bearing with us through this growth spurt while we get ourselves into a position to help support Drupal for the next 5 years! :)

seandunaway0’s picture

You all are doing awesome! Thank you for all your efforts!

Alex UA’s picture

There's no need to jump to conclusions- the ways that the DA Board, and specific DA Board members, have behaved are both unethical and potentially illegal. The fact that this was all done in complete secrecy is just another indication of just how far from our community's norms and standards you have strayed.

tgeller’s picture

both unethical and potentially illegal

These are very serious accusations. You have a blog -- make your case.

mikl’s picture

It's nice that you're now talking of openness, but I find it disappointing that you are not publishing the numbers from DrupalCon Copenhagen. While I realise that those numbers are probably an embarassment to the current DA leadership, there's a good lesson about listening to the locals in there :)

reglogge’s picture

What are you suggesting here? I find your comment very opaque.

jredding’s picture

Mikl,

If you notice we have not posted on a.d.o the numbers from many of our events, we post them during the actual event and on the event site. The final numbers get rolled up in the annual report (posted on the front page). However, with that said there is nothing we are hiding from Copenhagen and we're comfortable posting the details. Unfortunately to collate the data, write it up, and post it takes time and often we just don't have the time.

I will put this on the list of things for us to do and see if we can get those numbers out. If you or someone you know has a bit of time for this, get in touch.

-Jacob Redding

hadsie’s picture

Hey Jacob,

I contacted you guys in August and In December about the DrupalCon numbers for Copenhagen, both times you responded that it would be up shortly... in December you said:

"We are compiling the information
now and plan to release it within the next week or two.

-Jacob Redding"

I ultimately thought it futile after not seeing anything after that point. There were a few things that seemed a bit odd about copenhagen that I was curious about, including (but not limited to) the t-shirt and beer sales. It seemed as though individual organizers were pocketing the money on DrupalCon branded items and using DrupalCon as a platform to advertise them. As an example, some of the "limited edition" privately made DrupalCon t-shirts were being sold and managed by DrupalCon staff / volunteers. But it appeared that the profit from those were being pocketed by individuals who made the shirts. Obviously there would be no question here if the numbers and details were posted.

Cheers,
Scott

jredding’s picture

Scott,

Fair enough. We all get busy and things do slip. I'm comfortable being called out on it.

As Drupal VZW operates on a cash basis and DrupalCon Copenhagen happens in the Fall the ticket and sponsorship sales are encapsulated within the same calendar year. This means that our annual report gives everyone a great approximation of the breakdown of DrupalCon Copenhagen in our annual report. The annual report is posted on the frontpage of this website.

I'll take the opportunity to mention that this is our first annual report and is done for the benefit of the community. We want you to know where your money is being spent.

Here is the detail related to Copenhagen (in Euro):

Ticket Sales 268,129
Sponsorships 180,388
Total Revenue 448,517
   
DrupalCon 345,357
PR/Marketing   14,389
CC/Merchant Fees    3,809[1]
Total Expenses 363,735
 [1] Estimate: DrupalCon revenues were 70.17% of total revenues, 70.17% of total merchant fees of 5,429 is 3,809.

This equals 84,782 of revenue generation. 

Now at this time VZW began doing multiple operations at the same time and some of the professional services and staff time listed in the Annual report should have been allocated to the conference. At the time of DrupalCon Copenhagen we did not have the processes in place to do a proper allocation. However, I would estimate that another 20-30K in expenses would be billed against DrupalCon Copenhagen as directly related.

Leaving total funds back to the community at approximately 50,000 Euros.

In regards to the T-Shirt and other product sales this is the first I've heard of it. If you think that it warrants investigation or would like to inform us about inappropriate behavior please let us know. 

I have put this on the Agenda for the next Town Hall meeting (http://association.drupal.org/node/1174).

mikl’s picture

One of the last minute changes that happened in Copenhagen was the axing of our food- and coffee budget. It was explained to the local organisers as a necessary measure to avoid a shortfall.

Now you're saying there was a surplus of €50K, more than 10% of the gross.

So either we were not told the truth back then, or someone did a really poor job with a calculator. Neither reflects very well on the DA.

That also made the stinginess we met at every term so much more galling. Drupal Danmark had to pay for some of our invited speakers because we couldn't get approval for as much as a free ticket, and we fought for the longest time to get free entrance for a few of our most hard-working volunteers.

All so we could help bolster the coffers of DA.

jredding’s picture

Mikl,

Food, coffee, T-Shirts, and many other items have to be ordered 3-5 weeks before the start of the conference. At DrupalCon Copenhagen we experienced a late surge in ticket sales, part of which accounted for the surprise revenue generation of the conference. With the said, however, all conferences are expected to generate revenue so that the funds can be used in other portions of the community.

I don't see DrupalCon Copenhagen as bolstering the coffers of the DA rather DrupalCon Copenhagen was one of the primary sources of revenue that help to fund the drupal.org redesign, the migration to GIT, purchased a few new servers, and many other initiatives. I personally appreciate the word stingy. We try to be as efficient with the community's fund as possible while also throwing great conferences and events.

Please take a minute to read the Annual report, which details how we spent the community's funds.

Of course DrupalCon is a progression and with every conference we learn. One year after DrupalCon Copenhagen we now offer free admission to speakers and volunteers and we also lowered sponsorship rates, which allowed more companies to access the conference and allowed us to control our ticket prices and continue to offer them at a low rate.

-Jacob

mortendk’s picture

Hey Scott
I can see this is still hanging out there in the open so let me make it clear what happend, looks like in the “individual” - next time ping me so I see this ok?
Think im fairly visible to the community, then it won’t hang for a year.

Anyways to make sure that there are no myths about this, let me tak you to a run down on how it went down in copenhagen, with my awesomesauce & Tshirt empire.

Tshirts:

I did do 9 (i think) differnt DrupalCon CPH shirts that we all made for the DCCPH & was sold with the whole profit to the con.

Besides of that I had pushed hard a couple of years to make better merchandice for the community aka the sexy geek tees
on other events i had a duffel back and sold em outta there in the hallways.
I wanted to make it “an official thing” and support the DA.
the Association didnt wanted to have anything to do with it, but were fine that it was a part of the store. I repeatetly offered a cut back to the DA. But that was refused “we dont wanna have anything to do with it just do your thing morten” Well So i did.

The Tshirt shop has since turn into a thing at Drupalcon’s - The Drupal bookstore where small vendors can bring their stuff, whuich i think is pretty amazing.

It turned out to be a succes - *phew* We sold a ton of tees.

tshirt production was about 40.000 DKR
I ended up having a profit just about 10.000DKR.
This was all founded out of my own pocket.

The Beer aka the Epic Awesomesauce.

the Drupal Association didnt wanted anything to do with a silly beer project - they thought that all focus was on making a confence happen not all kinds of “non relevant projects”
I wasnt agreeing on that, so without thinking about consequenses i jump into the pool.

We wanted to make sure that people didnt get completely robbed when they were going out So we created this whole “fooBAR” concept, also to have one place where people knew the other Drupals were Beers are expensive as hell here in central cph you can easy end up paying 50dkr :(
So we had to do something, for the community & a strong belive in the social ties it makes when you hang out afterwards.

So the beer calculation looked like this:

Awesomesauce:
beer : 13,-
“Cork” : 20,-
Total bar price = 33,-
Sold in 4 Packs for: 100,-
Loss on each beer = 8dkr
5000 beers loss = 40.000drk

Normally Beers that mikkeller makes goes for about 40+ dkr at any bar in copenhagen, but cause of the insanity of the project & that mikkel is a star he did the beer absurdely cheap :)
If your not a beer geek, i can tell you that mikkeller is a celebrety in the beer world.

We did a sponsorship completely out of the normal sponsorship ranks (again the DA didnt want in on these crazy projects) local small cph shops that thought this idea was so rad that they payed 5.000dkr for each for 1. Case of beers

I put out personally about 70.000 DKR out of my own pocket, to get the Awesomesauce happening

So I had a backing 40.000, so if all turned to shit I would loose about 30.000 on it & had to find room for 5.000 beers (minus 8 * 24)

Personally loosing money on each beer that was sold, and that was if Every beer we made was sold - so if (and at that point it was if) the tshirt made a profit - it would more of less all work out. At this point I nor anybody else had tasted it - I did a description to the Mikkeller & prayed that it would turn out good. The beer btw came to us 6 day before Drupalcon Official started

We did manage to sell about 4500 beers at the bar - the Rest of the beers were given to the sponsors. Some were just lost (we had a release party that went outta hand) + we drank a bunch of them afterwards at various Drupal events, and the usual loss that happens.

It ended luckely that the sponsors at the fooBAR partys each night all wanted to drink the the Awesomesauce :)
So we ended up making a very a small profit on the bar - based on some deals, that dont really needs to see the light of day with the bar.

As i remember the calculation at that time we had a profit around 7.000dkr for the Awesomesauce.

Those money I put back into the bar as a big ass tab.
* The Sponsors of each nights party’s had a couple of bottles of booze, as a thank you for making this happening.
* The Copenhagen Road Crew (the volunteers) & other people that had busted ass for the project hade more of less a freebar each night (beers n shots)
* Obscure amount of Jack Daniels I gave to the Swedish rock n rollers: “Kitten Killers” for their concert at the bar, so they could feel like epic Rock Stars.
* And then on the last night we got champagne: One of the local team members had birthday and we all deserved it!

The bar tap as i remember it ended up in something about at least 10.000 for that week.

So after putting out about 110.000Dkr of my own pocket and when everything was paid & done (beers, Tshirts & bar tab, transport and whatever else) it ended up with me pocketing about 6.000 DKR + 5 cases of beer
Those money ended up in the Bad Ass Suit i wore for my presentation at Drupalcon Chicago.
… and then a year later had to pay taxes of it all - So I ended up with something of a loss around 10.000 DKR - Which i was completely aware of.

This is taken outta what I can remember & are all Rough numbers

So if you wanna accuse me of pocketing money on a Drupalcon copenhagen …
Well I bankrolled personally about 110.000dkr ( 20.000 USD / 15.000 €) and ended up loosing something around 10.000 dkr

So next time you wanna point fingers at me for pocketing money, ask me first ok
I really dont like beeing accused of beeing a money grapping asshole, digging into a community i love.

Cheers in the awesomesauce!
/mortendk

Anonymous’s picture

Explaining to 625,381 people in 228 countries speaking 181 languages why some decisions are made behind closed doors, not seen as necessary to publish, or deemed as commercially sensitive is never going to be an easy task, especially on a Free/Libre Open Source Software project who's mission it is to open up the world of the proprietor - you're always going to get a variety of views arguments coming through the comments!

I think we *need* the Association to be much more open - not because we want to cause a stir or because we think some decisions which are taken are necessarily right or wrong, but if we don't carry on as we are then we will not achieve the goal we set out to do in the first place:

"Free Software, Free Society"

I guess it's because I'm so nosey with code and see the benefits of openness I find the gap between completely open and somewhat open a mystery. I think @stubbornella's recent tweet "The sincerest form of protest is committing code. ;)" hit the nail on the head - it reminded me very much of the Drupal community, except we commit thoughts in discussions like this too, which is why I believe we need to Keep Calm and Carry On Contributing as it seems to be working reading the content of your post.

I just wonder how long the process of negotiating openness will take.

"That's one small step for [a] man, one giant leap for Drupalkind".

Thanks for the post!

Alex UA’s picture

I have posted the full rundown of why this is all very fishy, and potentially unlawful, on http://AuditTheDABoard.com, but there is no reason that I (or anyone else) should believe you here. You have "cleaned" your numbers to tell your side of the story, but you have not released the actual documents that could prove or disprove your point (what was Palantir doing during those 2,000 hours?).

As just one example: you say Palantir.net built the website, and yet GVS was paid to do so (I assume not via Palantir's bartered contract). Also, during the closing plenary, Palantir.net thanked the designers that the DA hired for doing the web design, so again I think you're not telling the truth.

Also, where in the 2010 return is the Palantir.net payment noted?

Prove me wrong: open the full, unaltered, documents and let the world (and laws) be your judge.

BTW- congrats on hitting $2-million in revenue! Now that you've reached that plateau you are required by law to perform an independent audit!

Alex UA’s picture

Why would you agree to pay Palantir.net a rate of $90/hour, when you only paid $75/hr to people in SF and Denver?

Also- is it safe to assume that the Drupal Association (VZW) did not pay its staff members' salaries, since you haven't been able to find a "legal" way to transfer your tax-free earnings overseas?

meba’s picture

Alex, I think it would be fair if you opened comments on your website, in the same manner as they are here to allow public discussion.
I personally still do not understand at least part of the problem. Palantir didn't receive any cash, they received sponsorship package in exchange for their work. Are you saying they didn't have enough work to be able to get the package?
Is it true or partially true that the Field party museum was sponsored by Microsoft? If that's true then your allegation about $45 of a ticket is untrue.

mfer’s picture

As the link Alex provided states, 501(c)(3) organizations in California need to have an audit when they pass $2 million USD. Unless something has recently changed the US Federal Government does not require a 501(c)(3) to have an audit. This is left up to the individual states.

According to the DrupalCon Inc Certificate of Incorporation (available to anyone) this organization is incorporated in DC. The California audit rules do not apply here. In looking at the DC Office of Partnerships and Grant Services website I could not find any information requiring an audit.

Does someone have better information on an audit requirement for DrupalCon Inc.

Note: I'm not for or opposed to an audit of DrupalCon Inc. I merely would like to see accurate information conveyed here. Also, since I was working for Palantir at the time of DrupalCon Chicago I'm refraining from responding to anything related to that at the moment. Hopefully I can (or someone can in a better manner) sometime soon.

Alex UA’s picture

You are correct that DCI is not registered in CA. However, it is certainly required to register and falls under California's Non-Profit Integrity Act. From the CA AG website:
To whom does the Nonprofit Integrity Act of 2004 apply?
The Nonprofit Integrity Act of 2004 amended existing law, including the Supervision of Trustees and Fundraisers for Charitable Purposes Act (Government Code sections 12580-12599.7), which requires registration and annual reporting by all charitable corporations, unincorporated associations, trustees, and other legal entities holding property for charitable purposes, commercial fundraisers for charitable purposes, fundraising counsel for charitable purposes, and commercial coventurers, over which the Attorney General has enforcement or supervisory powers. The Nonprofit Integrity Act of 2004 did not alter the range of persons and entities that are subject to the registration and reporting requirements.

The law’s application is not limited to entities that are tax exempt under section 501(c)(3) of the Internal Revenue Code, which pertains to charities. With certain limited exceptions, the law applies to any person holding money or property for charitable purposes. This includes entities that are tax exempt under other subsections of section 501(c), entities that are not tax exempt, and for-profit entities, if, apart from their general purposes, they hold assets for charitable purposes. If, for example, a social club or fraternal organization holds a fundraising event for a charitable purpose, such as creation of a college scholarship fund, the moneys it collects are held as a charitable trust and it is subject to the law.

The law applies to all foreign charitable corporations (corporations formed under the laws of other states) doing business or holding property in California for charitable purposes. Doing business in California includes soliciting donations in California by mail, by advertisements in publications, or by any other means from outside of California that satisfy the constitutional "minimum contacts" test. Other examples of doing business in California include engaging in any of the following activities in California: holding meetings of the board of directors or corporate members here, maintaining an office here, having officers or employees who perform work here, and/or conducting charitable programs here.

DCI signs its contracts and has conducted much of its fundraising from 300 Beale St. in California, and I'm pretty sure the 2010 annual board retreat was also held in SF, and thus the law applies.

JohnAlbin’s picture


“during the closing plenary, Palantir.net thanked the designers that the DA hired for doing the web design, so again I think you're not telling the truth.”

From the video linked on your own website, Alex, you can see that you are clearly wrong. The segment you are referring to is at 28:15 in the video in which Michael Mesker is thanked for working on the design of Drupalcon Chicago. The slide shown during that speech is the “Acknowledgements” slide and it clearly shows this:

“Site Design, Theme and Content: Palantir.net, especially Michael Mesker
[emphasis mine]

Michael works for Palantir. He was not paid by the DA and no one ever said he did. You are making up “facts”!


“you say Palantir.net built the website, and yet GVS was paid to do so (I assume not via Palantir's bartered contract).”

I can actually understand some confusion over this. It was a little confusing even to those who worked on the site. Full disclosure: I work for Palantir and worked on the Drupalcon Chicago website. GVS was not paid to build the Drupalcon Chicago site. They were paid to create a reusable Drupal distribution for Drupalcons and DrupalCamps. I have no direct knowledge of the GVS/Drupalcon Inc contract, so I can't speak to GVS' full contracted responsibilities. But it was Palantir's responsibility to build the site using GVS's code, design/ux/IA it, project manage it, theme it, QA it, populate it with content, administer it, build a mobile version of it, etc, etc. Basically everything else that you have to do for a website being built.

Did it not occur to you to ask somebody to explain how both GVS and Palantir were contracted to work on it? It was public knowledge.

I've looked at your allegations, Alex, and all of them stem from one of the following things:

  • Your misunderstanding of what happened despite clear, already-public evidence.
  • Your unwillingness to do any research to back up your claims.
  • Your inability to clearly explain what the problem is. Conflict of interest how? Private benefit how? You don't explain how any of allegations specifically apply to the people you accuse.
  • Your lack of knowledge of business practices. Most business happens because of referrals. If you have an existing business relationship with one organization and you want to eliminate the appearance of conflicts of interest, you disclose the relationship. It’s the disclosure that is a flag so that others know to take that into consideration. You don't STOP doing business with that organization or NEVER refer them. That’s insanity.
  • Related to above, your assumption that everyone is corruptible seems to mean that you assume that all business relationships are nefarious. There are plenty of incorporated businesses that are moral. (After all, most corporations are actually small businesses!) I feel sorry for you.
gdemet’s picture

Thanks John - We'll be posting additional information later today, but I did want to correct one minor item in your post.

Development of a mobile app for DrupalCon was not part of Palantir's responsibilities under the agreement we had with DrupalCon, Inc., so time spent on that was *not* included in the 2,300 hours reported to DCI. Mobile development used a combination of an additional 379 donated Palantir hours and considerable personal time volunteered by the team that worked on it.

Alex UA’s picture

Gah, I read the wrong line in the 990. DCI has only hit $1.5m in revenue, so they are not required by law to do an audit, which doesn't mean that they shouldn't, only that they aren't required to...

mfer’s picture

For anyone who clicks through to http://AuditTheDABoard.com I would like to warn you that the site contains inaccurate and misleading information presented in a FUD manner.

I understand the reasons every piece of every decision is not made public. One reason is that it would be quite a bit of work to compile and post publicly all the information. The team that runs the association and DrupalCon Inc are already very busy. I say this as someone who has had to push (and dare I say annoy) to get some things done that needed to be done. There is just more work to be done than bodies to do it. Sharing everything is not practical.

In order to run non-profits you need a certain amount of trust in your leadership. Some things can't be shared in public circles because of legalities, security, and privacy. Many other things are impractical. You need to trust your leadership to do their job. This looks like a case of Alex not trusting the leadership.

I did say there was inaccurate and misleading information. Some simple examples of that are Alex pointing out Palantir being paid when all parties point out that didn't happen. He has been informed of this numerous times and still inaccurately portrays the situation. From the looks of what Alex is sharing, he either believes the association and DrupalCon Inc are lying or he has not really done the legwork and research to seek the details. In some cases both apply.

More than anything, I want to warn any potential readers to do their own legwork. Unfortunately Alex did a poor job and I would like to see anyone involved to see an accurate picture. While I don't always agree with the decisions of the association or DrupalCon Inc I do not see anything troubling and believe they are looking out for our best interests.

Alex UA’s picture

I have spent months trying to get information that would counter what I posted on that website, and never received anything that disputes the accuracy of what I posted. If there is FUD, I'll certainly remove it, just let me know what is inaccurate and I'll post a correction and change the text.

davideads’s picture

"You need to trust your leadership to do their job."

While this is, to some degree, true, I'm not entirely sure how it applies here. You trust the leadership, Alex doesn't. Somebody should be skeptical of the leadership! You've complained several times about critiques being FUD, which seems like a way to shut down and dismiss a conversation. It also isn't a fair assesment in the case of people and institutions which are not spreading doubt for their own strategic benefit, which seems to me a key component of FUD.

Far more important than trust, in my estimation, is an institutional policy framework that creates accountability and transparency. For example, Dries' permanent DA status and ownership of the Drupal name work against principles of fairness and democratic community governance.

Not that DA must uphold those principles, but it certainly has represented itself as an organ of the community, working for the benefit of the larger community. That's probably somewhat misleading. As far as I can tell, DA isn't (nor is intended to be) the vox populi but to provide a forum and representation for Drupal's most important investors of time, money, code, etc. I'd say the Linux Foundation has done a better job of representing their role in the Linux ecosystem. I'm not knocking DA here per-se, but pointing out that both the ecosystem and the org are significantly younger and smaller (from a corporate investment standpoint) than Linux and so there are significantly more questions of definition and attendant growing pains.

All that said, I've been following Alex's allegations and comments with some interest and have found very little merit in them. In fact, I think Alex's style of critique and the eventual substance he's mustered has done far more harm than good.

He's been shown to be wrong on the facts, he has criticized good faith efforts by DA to be transparent, he has made a lot of noise on Twitter that he hasn't backed up or took months to back up, all with what felt to me like a snarky, self-important, speaking-truth-to-power tone.

All this has really hurt the ability to have critical, participatory discussions about how DA could represent "our" best interests, what we mean by "our" interests, what the DA should be, etc. It is too bad because an independent audit of DA probably would be useful, but not for the incredible conflicts of interest and gross misuse of funds which Alex keeps pointing at but which seem to disappear whenever you look where he's pointing.

If Alex really wants to investigate corruption and use that work to spur reform and a better Drupal community, he needs to create space for those in power to make good choices, work to help them see the world differently, and to call for accountable policies. Attacking with a hot-headed tone to raise charges that are readily dismissed hurts everyone who might wish to critique the DA's power structure in the interest of the common good.

Alex UA’s picture

If Alex really wants to investigate corruption and use that work to spur reform and a better Drupal community, he needs to create space for those in power to make good choices, work to help them see the world differently, and to call for accountable policies. Attacking with a hot-headed tone to raise charges that are readily dismissed hurts everyone who might wish to critique the DA's power structure in the interest of the common good.
I have already apologized for my tone, and the ways in which I brought this up, but would you not say giving the DA 9 months to work on this in almost total secrecy was creating a "pace for those in power to make good choices, work to help them see the world differently, and to call for accountable policies?" The charges I have raised are serious, and still are, but were dismissed by the DA, who went so far as to (secretly, as far as I can tell) appoint the main person whom I was and am concerned is failing in their faduciary responsibility as a board member of a US (c)3. That Tiffany was even on the board of a US 501(c)3 was denied before, but apparently, this since become even more obviously true, with Tiffany becoming DCI's treasurer (again, in complete secrecy).

To give one much less contentious example, since February I have been attempting to get DCI to register with California Attorney General's office, and even had the DA lawyer admit to me that they should "probably" have registered in that state (in accordance with the CA Nonprofit Integrity Act of 2004). But, as of last week DCI was still not registered, and is still endangering the financial standing of a charity I have supported. Forgetting for a moment the ways in which this all got started: how would you suggest dealing with an organization that you have financially supported, that claims to represent the community you have poured your heart and soul into for 4-5 years, which was not only not following the laws of the land, but which also seemed to ignore pleas to

Also, as has been pointed out numerous times in other places, none of the information regarding the relationship between VZW and DCI was public to anyone outside of VZW (and I'm guessing just the board, though that's just through conversations with DA General Assembly members). I, and I'm sure many other people, believed (and still believe) that the DA Board fully controls DCI. The fact is that the replacement of the treasurer of both involved the same person stepping down, and the same other board member stepping up.

I am a dues paying member of the Drupal Association (VZW), and I have also given considerable amounts of money (to me at least) to DrupalCon, Inc (DCI), a 501(c)3. Many of the mistakes in my argument had to do with things that are not completely transparant, but no one has argued against the key point that I am arguing: that it was a blatant Conflict-of-Interest to give Palantir a no-bid $45k contract. But, I did not have access to the COI policy, so I asked for it and clarification of how enforcement worked, as well as how to officially file a complaint. As you can see on that post, nobody responded, and the private e-mails and conversations I had with Jacob and Dries indicated that the COI didn't exist (it obviously did, and is now posted). It was only after I found out that not only were my complaints not being taken seriously, but that the very people I had been raising concerns about in private were appointed to a COI committee to draft a new (it turns out to have been just one of the people, if you like I can send you the e-mail from Jacob telling me two of the five COI committee people were amongst the three I had raised concerns about).

Now that the COI is published, it is much easier to couch things in the terminology of their own agreement. What I am asking for is an independent audit to ensure that there were no violations of tax laws during the lead up to and execution of DrupalCon Chicago, and this is what the COI policy says:
Article VII
Periodic Reviews
To ensure the Corporation operates in a manner consistent with charitable purposes and does not
engage in activities that could jeopardize its tax-exempt status, periodic reviews shall be
conducted. The periodic reviews shall, at a minimum, include the following subjects:
1. Whether compensation arrangements and benefits are reasonable, based on competent
survey information, and the result of arm’s length bargaining.
2. Whether partnerships, joint ventures, and arrangements with management corporations
conform to the Corporation’s written policies, are properly recorded, reflect reasonable
investment or payments for goods and services, further charitable purposes and do not
result in inurement, impermissible private benefit or in an excess benefit transaction.
So, what I am asking for is proof (provided to an independent group of community members) that "compensation arrangements and benefits are reasonable, based on competent survey information, and the result of arm’s length bargaining" as well as whether #2 is correct as well.

In addition I want to make sure that all of the procedures in the COI were followed, if not for the vote, than at the moment when the contract was being signed.

So, how exactly are the charges of Conflict, charges that can be "readily dismissed?" Yes, I still am very suspicious of the selective information that DCI/VZW/DA is releasing, and I still want an independent group to ensure that DCIs own rules, as well as the tax laws under which it must operate, were followed, but yes, I should have gone about it in a much more sane way. I have apologized numerous times for letting my frustration boil over, and I even gave myself a DCoC warning to ensure that this is my last allowed "blow out" in the Drupal Community. But I believe that using that single warning for this purpose was, ultimately, worth it, because almost none of the things in this post were public, and only this crisis has pushed DA to even disclose that the DA was not in total control of DCI (and with it, hundreds-of-thousands of community dollars). Heck the DA only took DCIs staff off of the DA staff page this week, and they sent out an e-mail from one of those staff members two days ago that still claims that the staff person works for the DA (and doesn't mention DCI).

Anyway, I hope that at the very least this pushes the DA and DCI to fully open their processes, meeting minutes, votes, etc. There is no place for this level of secrecy within an Open Source community. Secrecy breeds suspicion which breeds anger. It is time to live by Open, and to accept that sometimes Open means that decisions take longer and are questioned much more, and that's the entire point. I know Damien mentioned wanting the DA to do more, and I share that sentiment, but I also don't want it to scrap our morals, its own policies, and possibly tax law to do so.

Alex UA’s picture

For the record, here is a link to the original post sent to the Drupal Association Board this pat winter.

Also, WRT trusting those with power, I suppose we have to agree to disagree. I quoted this on the other site, but suffice it to say, I think that suspicion of power is both natural and healthy. We are only able to avoid it by staying open, keeping our processes clean of interference from those with power, and ensuring we have clear checks and balances to guard our institutions from being used to advance individual interests. In other words, suspicion of power is not FUD, it is our right, and it is our responsibility.

. . . experience hath shewn, that even under the best forms [of government], those entrusted with power have, in time, and by slow operations, perverted it into tyranny . . .

&
. . . it would be a dangerous delusion were a confidence in the men of our choice to silence our fears for the safety of our rights: that confidence is everywhere the parent of despotism: free government is founded in jealousy and not in confidence; it is jealousy and not confidence which prescribes limited Constitutions to bind down those whom we are obliged to trust with power: that our Constitution has accordingly fixed the limits to which and no further our confidence may go; . . . In questions of power then let no more be heard of confidence in man, but bind him down from mischief by the chains of the Constitution." - Thomas Jefferson

Alex UA’s picture

I cannot edit the original comment, which contained a number of issues I'd like to issue corrections for:
1) DCI did not have $2m in revenue, it had $1m, so the CA nonprofit integrity act would not force it to perform an independent audit (if budget growth is an indication, this year it will need to).
2) It appears that both the budget for GVS and Palantir are in fact included, and thus I was wrong to accuse Jacob of not telling the truth.
3) The designer mentioned in the closing plenary is actually a Palantir employee, so her work is covered under that line item.

Sorry for my confusion.

mfer’s picture

To add to the list of inaccuracies, the designer is Michael Mesker. A man. Referring to him as a her is another inaccuracy.

Alex UA’s picture

Sorry about that.

crdant’s picture

I welcome this increased transparency, and think it's part of the maturing of the Drupal Association and Drupalcon Inc. One of the difficult parts of this equation is that there are clear appearances of a conflict of interest, regardless of the motivations of anyone involved. Putting appearances first is counter to the meritocracy and achievement-oriented culture of the Drupal association, but it's something that's essential to understanding conflict of interest.

That's an important lesson for the DA as it continues to evolve, and something that should be addressed quite clearly as the governance around the latest changes to the DA continues to take shape. For example, whether it is a conflict of interest for members of the DA board to be part of company that receives an in-kind sponsorship for Drupalcon is a question that is open to debate. Whether those board members could have avoided the appearance of a conflict of interest, and the record of the DA could have reflected this, is not. Abstaining from key votes, and open voting records of these abstentions, would avoid all appearances of a conflict.

This specific case is in the past, and I believe there was no malice involved. In the future, I think it would behoove any member of the DA board to abstain from voting on matters that create an appearance of a conflict, regardless of the purity of their motives.