Looks like they spent like the money will be flowing forever.
Imagine, in the abstract, an organisation that wasn't exactly accountable to anyone with a half-billion dollar pot as the prize for whoever ended up in charge. Can't possibly end well. Brand that with a "Mozilla" logo and the situation doesn't change much.
If anything, I think - paradoxically, but as I do for all charities - that Mozilla is acting responsibly if they are burning through all their cash. If they fall on hard times that is more a signal that they've lost the faith of the internet at large than a marker of financial imprudence.
A charitable foundation with no doners should be wound up. Otherwise it'll just invite corruption. Exceptions for tiny amounts of money, but not for the sums Mozilla is dealing with.
I think money corrupted Mozilla and turned it into another VC powered YC company where talent left and product and engineering management created a replaceable r&d team without passion .
For many charities, probably, yeah. But Mozilla being in the position that an endowment more or less funds at least 'support' level of maintaining a fully independent browser beholden to absolutely no one, even if literal zero money is flowing in otherwise - that's a nice thing to have.
It does invite corruption, and in the end, if nobody cares about mozilla (the browser), it should indeed go away, but 'being cared about' and 'raking in the dosh' aren't quite the same. Sure, you can turn care into cash (donate buttons and the like), but if you don't have to, that's nice. Mozilla (the browser) is likely to die if the funding that they CAN provide is a decent salary but nowhere close to what other companies could possibly offer – _and_ nobody cares about it.
Here's what I mean by that last one: I'm sure PKK (author of linked article), for example, could be convinced to do the job of quirksmode/MDN for a salary. And that salary does not have to be close to what PKK could get as a freelancer or at google or whatnot, but it should at least be somewhat representative of his particular skillset. Effectively, then, PKK is still donating - a lot - namely the difference between the salary he'd get vs. the salary he could get, but he gets something in return: Working on a thing he likes to do more, and contributing to the open web.
Had firefox been raking in millions a month off of user donations, and spending it all on the projects they were spending it on, you might be right: That's fine, and if the money dries up, they downsize - that'd be a better way to do it vs. setting up an endowment.
But that is NOT what happened. Firefox got most of the running funds via e.g. having google as default search engine. That is a cashcow that may at some point run out; at the very least you are too beholden to too few parties, and that itself is far more likely to be 'corruption' (as in, have the same downsides) than a charitable foundation with more cash than carers. Turning THAT windfall into an endowment does strike me as a wise move. Especially if you earmark that endowment for a limited purpose (presumably, earmark it for team gecko and very few other parts of moz).
How come i've only seen universities do this?
If the best thing the business can think to do with the money is put it in the stock market or a low-interest cash account, which anyone could do, investors usually demand that the money is returned to them (via dividends or share buybacks) so they can choose what happens to it.
Harvard's endowment is invested in profitable business to raise money. It's a non-profit so it doesn't pay out the profits. A profitable business invests its funds itself or returns them to the owner institutions, who chose whether to keep funding the business.
However, in Mozilla's case, the owner of the corporation is a non-profit, and (to me at least) it'd make a perfect sense to set up something like this.
Software is an exception in this since you basically only have free cash, there are no physical assets as such.
And why don't they? Decades ago, having cash reserves was a Good Thing.
We need to get at the root of the issue and that is that companies have gotten used way too much on government bailouts and redistributing everything possible to shareholders/customers.
The problem started with people like Carl Icahn.
If your company has too much cash, someone will attempt take control to carve it up and get their hands on the cash.
So, every business basically runs fairly close to cashless or even carries debt in order to avoid corporate raiders unless they have SO much cash that nobody can even hope to buy them (see: Apple).
But relatively it probably applies to bigger manufacturing companies as well. Hell, it probably applies to Amazon (the retailer, not AWS).
That's perhaps the most genius thing in the Amazon system: the actual amount of cash bound in warehoused inventory is negligible - they only have the risk for stuff they directly sell. For all the other products, the sellers are on the hook towards the manufacturers.
Essentially they are an online Walmart with next to zero of the risk a real Walmart has because most of their inventory risk is shifted towards the "sellers"...
They would pay net-10, which was unheard of, most of their big buyers habitually paid late. The local grocery chain would pay 60-90 days late on a 30 day invoice. The cash in hand was worth sometimes losing a little money.
If every business has an endowment, what are those endowments invested in?
Because in the end, when shit hits the fan like with the 'rona, the government will be conveniently pressurable to bail you out. Personally, I rather have government bailouts than mass bankruptcies - but bailouts should come with "strings attached" like, let's say, a requirement to always keep one year of expenses at a reserve to avoid the need for future bailouts.
sort of a short sighted view if that's really the case - since the cash being in the company's books, or in an endowment, is still value owned by the owner. The small penalty of it being illiquid shouldnt be a problem.
Look at how quickly oil and gas companies implode when there is a price shock.
The stockholders though would probably say that they can just supply the capital themselves, if the business is in trouble.
Wherever these management types continue to fuckup company for their lavish lifestyle, such things happen.