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Comment by infamouscow | Hacker News Reader

I wish they went for a 501(c)3 non-profit, rather than a 501(c)6 trade organization.

The incentives between these two structures make a world of difference.

Just skimming the regulations, I don't believe that it would qualify as a 501(c)3 as they don't receive "broad public support" [1] whereas the criteria for a 501(c)6 match exactly with their goals. Additionally the (c)6 allows for political activity related to the purpose of the organization, which seems like a good ability given the current intersection of politics, regulation, and tech. [2]

I'm not sure what you mean by "incentives". Perhaps you could elaborate.

[1] https://en.wikipedia.org/wiki/501(c)(3)_organization#Types

[2] https://en.wikipedia.org/wiki/501(c)_organization#Contributi...

I started a 501(c)(3) with some friends. It didn't require broad public support, just that we intended to grow to such a point.

(I'm not sure exactly what the current support is like; I left the board over a year ago. I think it's around 10 folks that donate somewhat regularly.)

Certainly the political activity provision of 501(c)(6)s are beneficial for this association, and I guess they'd have more scrutiny as three large companies instead of a few high schoolers.

You will find that many of the open source backing non-profits are trade organizations. Some notable examples:

- The Linux Foundation (which includes the CNCF and OpenJS Foundation)

- Rust Foundation

- Bytecode Alliance

I don't mean to provide an opinion on incentives (and they are different as the parent suggests). I just mean to share that trade organizations are already common.

Disclaimer: I work for SUSE but not on OpenELA. I am also a maintainer of CNCF projects and on the CNCF TOC.

Small nit but technically OpenJS is a separate 501c6 that is currently managed by the LF, they're not "underneath" the LF in the same way that CNCF is. Not sure why that's the case, probably just historical reasons since they were independent for a long time beforehand? Doesn't seem to change much operationally as they have the normal C6 structure with corporate members, etc.

Oracle, SUSE, and Greg Kurtzer have zero interest in not profiting from this.

It's incredibly difficult (read: impossible) for this type of organization to be a true 501(c)3.

can you elaborate?

Sure! IANAL, just a dev, but my understanding from seeing this play out over the last 20 years is the following broken down first by public vs. private benefit:

501(c)(3): Organizations under this classification must primarily serve a public interest and not a private interest. Any private benefit must be insubstantial.

501(c)(6): These organizations are designed to serve the private interests of their members, as long as those interests align with the broader industry or line of business.

Everything else follows from this distinction IMHO. You see it play out in the Linux or Rust foundation, in contrast to the Python or Zig software foundation. It's easier to get attention and members with a trade organization, but over time, over the long term, there's a stark difference that I believe is not disputed.

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