Comment by swiftcoder
15 hours ago
> MZLA Technologies Corporation is a wholly owned for-profit subsidiary of the Mozilla Foundation and the home of Thunderbird.
I guess I don't understand why the open-source email client with zero revenue potential is managed by a for-profit subsidiary, nor why that for-profit subsidiary is begging for donations.
Shouldn't this whole thing be managed by the non-profit Mozilla Foundation?
Basically the IRS is highly skeptical of the idea that free software development fits the legal definition of a 501(c)(3), and tends to reject such applications [1][2]. That is why Mozilla Foundation cannot use donations for Firefox development, and instead uses them for activism.
So that creates the strange situation where legally it is easier for free software developers to accept donations as a for-profit corporation than as a 501(c)(3) non-profit. It is possible to instead incorporate as a not-for-profit corporation which doesn't have the tax advantages of a 501(c)(3), but does have the advantage of not being beholden to share holders. However, many people react negatively to this assuming that any not-for-profit that isn't a 501(c)(3) is a scam.
[1] https://www.stradley.com/business-vantage-point-blog/irs-con...
[2] https://www.mill.law/blog/more-501c3-rejections-open-source-...
I am the CEO of MZLA (the Thunderbird entity). This is a large part of the reason. ^
Nice insight and links. I wonder how Hack Club (501(c)(3)) does it.
What percentage of their money do they spend on developers? If it is more than 50% on "non-charitable activities" (of which software development is not considered) - they may be on the wrong side of the IRS.
@pavon, spot on.
I don't see them begging anywhere, I only see someone sharing a link to their donate page.
For what it's worth because legal names are confusingly similar, this is a legal subsidiary of Mozilla that is specific to Thunderbird, as in if you give it money it goes straight into Thunderbird. Many people here pretend to wish to be able to give money directly to Firefox, yet when they can do that for Thunderbird, people here are still finding bullshit reasons not to do so. Pick a lane.
> For what it's worth because legal names are confusingly similar, this is a legal subsidiary of Mozilla that is specific to Thunderbird
Right, I get that, but why is it for-profit? Fund raising is hard enough for nonprofits, convincing people to donate their hard-earned cash to a for-profit is on a whole different level.
I'm definitely not involved with any of them to know for sure, but my guess would be that's because non-profits come with a lot more regulatory overhead in comparison to for-profits of a similar scale. Not saying that's bad in any way, but for a team that just wants to build the damn thing, for-profits are absolutely less of a hassle.
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One thing that's important to note (which holds for the Mozilla Corporation too) is that the for-profit thing is a legal status, but the Foundation (an official non-profit) is the only shareholder, i.e. the only entity that "profit" can flow to. So you're not lining some billionaire's pockets.
(Though of course, employees of either entity can be paid whatever, which also holds for every other non-profit.)
My understanding is the for-profit structure was necessary in order to be able to do the search licensing deals finance Firefox.
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Not that it answers your question, but the move happened in 2020 to "hire more easily, act more swiftly, and pursue ideas that were previously not possible".
https://blog.thunderbird.net/2020/01/thunderbirds-new-home/
So here more than 6 years later, did they act more swiftly or pursue new ideas? The development pace seems unbearably slow.
Judging from the side it seems like there aren't a lot of developers and the current few have their favorite subsystems, those get almost all of the attention. The rest is kept as-is and does not progress. I also don't know if there's a trivial way to find how many external contributions they get from BugZilla, if they even get any?
They could EASILY have had and still could have a companion service for free/hosted email/calendar/contacts. It could even have an open implementation for "open-source" private hosting. Could be a great alternative to the enshittified Outlook/M365 even. Could pretty readily undercut alternatives and still be profitable.
At least as a point of funding the open-source work.
This is just organizational structure. "For-profit" doesn't mean "profitable". Also, the organization is "wholly owned" by a non-profit, so if there are profits declared in the form of dividends, those dividends are sent to the non-profit.
Note that many non-profits have exceptionally high-paid executives and "contractors".
Regulatory requirements on non-profit organizations are very high, and those organizations are, in fact, very limited in what they can do and how they receive their money. There are very good reasons for a non-profit to own for-profit entities, and, similarly, for philanthropic organizations to organize as for-profit entities.
Please no. The Mozilla Foundation has lost their way. I don't want them messing with my favorite email client.