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11. Become a fiscal host and manage funding via Open Collective

Date: 2025-08-20

Status

Accepted

Context

StartMeUp.nz needs a way to accept donations, receive public funding, and reimburse expenses in a transparent and auditable manner.

We also intend to support and contribute to Free and Open Source Software (FOSS) projects, which means we need a system that allows us to both take in funds and disburse them responsibly.

Alternatives considered included:

  • Handling payments directly via Stripe and custom donation pages (greater flexibility, but more maintenance).
  • Using GitHub Sponsors or BuyMeACoffee/Ko-fi (simpler setup, but less transparency and limited expense handling).
  • Relying solely on traditional bank accounts (opaque, no public ledger).

We briefly evaluated Xero as a candidate. It provides robust accounting and compliance features, but it does not solve the problem of public, community-facing transparency. It is more useful for statutory reporting than for participatory funding workflows. A free trial confirmed that while valuable for compliance, it did not meet our goals for open financial collaboration.

Open Collective provides:

  • Public, auditable ledgers for income and expenses.
  • A platform to act as a fiscal host, enabling us to hold funds on behalf of projects we support.
  • A ready-made workflow for donations, reimbursements, and community transparency.

Decision

StartMeUp.nz will become a fiscal host on Open Collective.

  • We will use Open Collective to manage funding, receive donations, and pay expenses.
  • The legal and financial foundation will remain our New Zealand charitable company (ADR-0005), but Open Collective will be the operational platform.
  • Configuration will be managed as code where possible (see ADR-0012).

Consequences

Positive outcomes:

  • Transparent, auditable finances that build trust with donors and collaborators.
  • Lower operational overhead compared to building custom financial tooling.
  • Standardized workflows for reimbursements and payouts.
  • Ability to host other projects under our fiscal umbrella in the future.

Risks / Trade-offs:

  • Platform fees reduce net funds received.
  • Dependency on a third-party service (risk of lock-in).
  • Requires discipline in separating Open Collective’s operational records from our private relationship/CRM data.

Mitigation:

  • Maintain “configuration as code” laying the groudwork for automation in the future.
  • Export and periodically back up transaction data.
  • Define clear governance for hosting third-party projects before accepting them.
  • Develop Onboarding process.