Creating a Financial Foundation for Shared Infrastructure

Over a decade ago, I was one of the founding members of the Dallas Makerspace. My major contribution was designing the financial models that allowed the group to have a solid financial footing for renting it’s first dedicated space.

The other founders were more involved in all the growing pains of starting an organization like that, and I moved to another city and didn’t lift those boulders. But (as far as I know) the original membership models kept the group bootstrapped long enough to attract more members and grow into the organization they are today.

A member of the ThePrepared Slack recently asked how I did this, and in retelling the tale, I realized that I’d never written down the methods I used. I think sharing them here might be helpful to other people looking to start either their own hackerspace, makerspace, or other opt-in, volunteer-driven group that seeks to have a single costly piece of shared infrastructure.

The Problem, Or What Not To Do

First let me lay out the problem. A volunteer organization starts with zero money. It can ask for donations and have some non-zero value of money, and then they can spend that money on projects. This model works fine if the projects are less frequent than how often you can ask people for money. If the organization wants to rent a space, they will now have a monthly operating cost that extends into infinity. There is no time when you’ll have raised enough money to pay for all the rent forever. You can only raise enough money for some number of months. You can think of each months rent as a “monthly project” you need to raise money for. If you organization has a regular meeting once a week, that means you will be either about to ask for money, asking for money, or telling people how much money you raised three out of the four weeks of the month. A primary task of the volunteers who have donated their time to keep the organization running will be to figure out how to collect enough money each month.

Suffice to say, unless your organization is a group of people who love to ask other folks for money, this will not be an activity that is long term sustainable by volunteers. They did not join the ranks of your group to run around asking folks for money.

A Better Way

So you need a different model. Enter “membership subscriptions”. To be part of the club, you have to pay some amount. It should be automatic, like a PayPal subscription, so there is almost zero overhead on the volunteer leadership. It should be automatic so that your members don’t have to think about it. It should be monthly because your costs are monthly and matching those two time periods up is simplest and the least amount of work.

You will now need to do a solid amount of research to understand what your real monthly costs will be. There will be rent. There will be tool upkeep. There will be consumable supplies like toilet paper or sodas or paint or whatever it is your group needs. You will want to understand what kind of pad you need each month to save for annual costs or unforeseen problems. You probably also want to budget in some saving each month towards improving your group’s shared resources – eventually buying that laser cutter, for example. Or saving up for the down payment on a bigger space. You may also want to save up for a fund for member scholarships, or sponsored members, or paying for invited speakers.

After you know the monthly budget, you now have a sliding tradeoff between how much each person in the group will pay each month and how many people are in the group. The extremes are easy: If you need $1000 a month, you could have 1000 people give $1 or one person give $1000. But neither of those are likely, so you’ll be somewhere in the middle. Is 100 people who give $10 a month possible? What about four people who give $250? What about 33 people who give $30 a month? You can imagine situations where any of these could be the most appropriate case – it really depends on your group and what it is doing. My experience would suggest that you’ll have easier luck attracting fewer people that give more than having to find many people who give less, but you know your group better than I.

If you don’t, now is a good time to start going to the group members and finding out what sort of monthly contribution they’d be comfortable with. Have honest talks with people and get to a real value. It might be lower than you’d like, but it is best to get something people will actually commit to. In this day and age, folks have a lot of subscriptions running. When I was doing this, it was much less common. People will know what they are willing to contribute.

So now you can build a membership model. You’ll have a set rate of monthly contribution per people, and you can then find how many people you’ll need contributing. If you already have that many people, you’re finished! Congratulations! Chances are, you don’t have that many people, and so your new task is to attract enough people to your group who are willing to contribute. Even if you do, I recommend the following steps because it will cement a solid group of “founders” who are dedicated to the project.

How To Do It

The advice could end here and be pretty straight forward. I basically described “how to do division”. But there is a key strategy that you should use.

First, go around to all the members and present the model. Show them the spreadsheet. Share copies with them so they can tinker with it if they’d like. Make sure to answer all the questions on the different monthly costs you put in there. You’ll get to explain to them how much insurance costs, probably. They should check your work.

Second, start collecting monthly subscriptions now. Maybe not everyone will be enthused to contribute to a shared resource that doesn’t even exist yet. But you need to bootstrap your finances. Your group should be meeting regularly as if they actually had the shared resource. If you’re trying to find a permanent space, keep meeting at the temporary spaces. It will be a key time to bring everyone together and say something like “We are meeting here now, but according to the model, we’ll have our own space in a few months!” It helps people understand that the project is succeeding.

Third, do a “founders fundraising”. There will be some members that can spare a little extra money to kick start the project. Maybe they’re deep pocketed or super committed. I suggest asking for a round of three months worth of contributions. This is really only two months, because they should be contributing their monthly amount already. You won’t ever do this again – it is a one-time deal. In effect what it does is pay for some members that you haven’t attracted yet. It should be uniform – don’t have different tiers. Don’t fall for the trap of having one super-donor. You want there to be a sense of shared ownership in the group, not one person that gets an outsized say because they donated more. These founders are the committed folks and they’ll be the core of the volunteers that keep the project going in it’s infancy. They need to be on even footing, because a lot of them will be putting a lot of time volunteering for various tasks that need to be completed. folks that join later, but before you actually have the shared resource, could also join as founders if that makes sense for what you’re doing.

At this point you’ll be able to plot a chart of membership growth that shows when your monthly contributions will match your planned monthly expenses. You’re still out there gathering members right? Well, as long as your numbers grow or stay steady, that crossover point gets closer and closer. Meanwhile, you’re collecting money to build a reservoir to deal with folks coming and going.

Possible Outcomes

There are three possible outcomes: your contributing membership keeps growing, flattens outs, or starts decreasing.

Increasing membership

If the contributing membership keeps increasing, then you’ll quickly reach your break even point and be able to buy whatever shared resource you were trying to buy. You’ll be solidly able to hit monthly expenditure targets and will probably even start to grow a surplus. The group can use that surplus to improve the shared resources or buy new ones. It can use that to sponsor scholarships for new members. Figuring out what your group will do with it’s surplus is a great problem to have. I strongly caution against lowering the membership contribution level. This will upset previous folks who already were contributing at a higher amount. It also means you need to go back to the drawing board on what people are willing to contribute. You’d rather begin with a lower contribution than a high one that gets lowered later.

Flat membership

If you can only keep the same number of people contributing, or you lose people at the same rate that you are gaining people, you aren’t in that bad of a situation. Since you are collecting each month, eventually you’ll simply save up enough money to pay for your goal. The degenerate case here is that you’re the only one contributing and eventually you just save up enough to do whatever it is you’re trying to do. Earlier I said that you need to have a monthly contribution rate that matches your monthly contribution spend. That isn’t technically true if you’re doing something like a yearly lease. You’ll save up enough money to have a whole year’s worth of lease – it could take longer than a year depending on how many founders you had. You’ll then be able to sign that lease in a responsible way knowing that your group has saved up enough money to cover all the costs till the end of the lease contract. You’re making a bet here that by actually having the shared resource, you’ll be able to attract more members in the upcoming year. Attracting new members will be an important part of the group’s activities that first year if it wants to continue having that shared resource for the next year. But if it can’t do it, maybe it just wasn’t meant to be. You’ll have a good run of a year, and honestly that’s pretty great.

Declining membership

This is the failure mode. I would seriously reconsider the nature of your group. Are there toxic members driving away others? Are the membership rates incorrect? Is the shared infrastructure just not in demand enough? Something has gone wrong. I can’t tell you what, but signs don’t look good.

All is not lost. If you can keep a core group of folks to keep the dream alive, eventually you’ll build up enough funds for your group to get that laser cutter or storage unit or taco truck. Once the group has access to it, hopefully you can use whatever it is to attract enough people to get your membership numbers back up.

Conclusion

Hopefully this is a helpful guide. You and your founding team will have a lot of work to do, and if they’re volunteers, that’s a whole other resource to manage. But hopefully you’ve got a growing group of interested and people and a cool piece of shared infrastructure you can all rally around.

Comparing Engineering and Design

In an earlier post I wrote about the similarities between engineering and design. After discussing the concepts with a few engineers and designers, I thought it would be helpful to explore the differences between the two disciplines.

a crushed empty soda bottle on the ground
Photo by Roberto Sorin on Unsplash

Known solution versus unknown solution

In the introductory chapter of Designing Your Life, the authors point out the most salient different between engineering and design problems.

… [E]ngineering is a good approach to solving a problem when you can get a great deal of data and you’re sure there is one best solution.

Designing Your Life (Evans and Burnett, 2016)

They position design problems as not having a known single best solution.

[Creating the first laptop with a built-in mouse] was a design problem. There was no precedent to design toward, there was no fixed or predetermined outcome; there were plenty of ideas … but nothing was working.

Designing Your Life (Evans and Burnett, 2016)

In other words, engineering explores a problem space with a clear well-defined solution, while design explores a problem space without a well-defined solution.

Solvability

A professor introduced me to the idea of asking whether a problem is “solvable by design” or not. This is a question a designer should ask when identifying a problem to solve. I found it incredibly helpful to break out of an engineering mindset. I was in the early stages of a project, exploring a problem space and being a bit overwhelmed at all the different facets of a large and complicated situation. My process was to try and create a framework for understanding the entire problem space, and then using that framework to come up with “the solution”. The framework was helpful – it provided a way to organize my group’s thoughts and gave us a common language to talk about the different facets of the problem space. But it did not point to a “solution” – instead it made clear that the tree of problems we were looking at had a root problem that was simply not solvable by design. The best we could do is mitigate some of the effects of the problem and provide a tool designed to help the people affected cope.

I’m not sure that engineering has such concept as “not solvable by engineering”. Certainly there are problems that aren’t, but I don’t recall that being part of any engineering course or discussion I ever participated in. It is perhaps a blind spot in the way engineering is practiced. Or perhaps such problems are dismissed as “not solvable by engineering yet“.

Tensions versus Trade-offs

Engineering is completely about trade-offs. The engineering Iron Triangle is a well-known diagram explaining the relationships between quality, time, and cost. Many physical parameters result in trade-offs – current through a device versus the amount of heat which can be dissipated or the range an aircraft varies as you trade off the weight of fuel and cargo. A trade-off is well-defined, often to the point of a precise mathematical relationship.

Tensions are similar to trade-offs but are not well defined. When a worker is remote, there is a tension between the amount of freedom a worker experiences by being “more remote” pulling against the connectedness they feel with their coworkers as a result of in-person experiences together. There is no precise amount of one or the other which is traded. Someone in a hybrid remote/in-person job experiences both, in a complex and continuous relationship. It is not possible to create a rule between the two, other than that in general and for most people having more of one will tend to have less of the other.

In both, two desirable properties cannot be completely fulfilled.

Avoiding the wrong methodology

I ended my earlier post saying that the two fields could learn from each other’s methods, and I don’t feel like the above differences refute that.

Instead my suggestion is to identify which kind of problem you are solving and avoiding the wrong manner of solution you seek. Solving a design problem with an engineering methodology leads to the collapse of an unknown solution space into a known solution space, often by reducing the problem to simply “Can this be done?” or “Can we do this?”. These can be a dangerous questions to solve because they do not consider if something should be done or not.

From a personal perspective, I believe that engineering-oriented organizations not coming to terms with whether they should be creating something or not has resulted in many negative consequences for society. Understand your problem space and choose carefully.

Building a small team

When starting a new venture, your team is often small due to timing, budget, or uncertainty. Growing a team from a small starting point takes careful thought about both the current needs and the future. When only a handful of people are on the team, each hire has a dramatic increase in the communication costs and cognitive load of relationships. There is a combinatorial jump as N goes from 2 through 6 that is unavoidable.

Photo by Wolfgang Hasselmann on Unsplash

On a small team, each member has to cover a wider spectrum of topics, even if the depth of understanding or time commitment of each topic is small. Someone needs to do all the little administrative tasks but they do not all sum to an amount of work that represents a full position. And that is often the case for many other topics. You do not need specialists yet.

But the software and technology industry is geared towards specialists. The cynic would say it is because it is easier to put people into a box with a label and disregard the other skills someone has. I think it is simply the nature of a tech industry culture dominated by huge players that are assembling large teams that are looking for very specific specialized roles. Those companies’ influence sets the tone of the discussion. When someone might get a job at a 10,000 person company or a 100 person company, which framing are they going to gravitate towards for themselves? It seems the gravitational pull of the big players wins out.

So building a small team is difficult. It is intrinsically difficult to do, and the hiring marketplace is slanted against giving you the information you need.

My advice, and the techniques I use follow.

First, I do my best to look for self-described generalists. If someone is sticking their neck out enough to go against the prevailing demand, chances are they’ve really thought about it. They tend to be well-rounded engineers and designers with a pragmatic view towards getting the job done.

Second, I talk to folks to get an idea of how flexible they are. Are they dogmatic? Do they know how and when to compromise? Have they worked in diverse teams of people with different backgrounds and goals? These are all signs that when something unexpected needs to be dealt with, they’ll be okay stepping up to the plate.

Third, I try to understand how everyone’s paths on the team will interleave and harmonize in the mid-future. What this time frame constitutes is highly dependent on the context, but what I mean is the period between “here is all the stuff we need to do now” and “here is all the stuff we’ll do one day”. When will you need a UX Engineer? When will you need a Usability Facilitator? As dedicated people fulfilling just that role, you will need them “one day”. Right now they might need just half a day each week. How is the role going to be filled by the various members of the team as the amount of work changes? It’s a multi variable optimization problem whose solution changes over time and suffers from unexpected shock events and step functions. Your goal is to keep your heuristic hat on and correct course as needed. This might involve hiring, but hiring is probably way too slow. You’ll need to know your team and who has the interest and ability to pick up something outside their wheelhouse.

You can see that the underlying theme is open and clear communication amongst team members, and that is my single point of advice. Stay in touch with the team – not simply hearing them but actually listening to what they’re saying and what is being left unsaid. Encourage constructive and celebratory feedback as a norm. Set up weekly 1-on-1s to understand where people are and what challenges they’re facing, not what work they’ve done. Create a space for discussion and have regular retrospectives so issues and concerns can be brought up, addressed, and reflected upon. Strive to establish a culture of psychological safety.

Building a small team often goes hand and hand with starting something new: a new project, a new feature, or even an entirely new company. Those are hard contexts for any sized team. But with open and honest communication you can deliver and succeed.

Good luck out there!

The Overlap of Engineering and UX Design

While simultaneously working in software engineering and completing my masters degree in HCDE, I started to notice a few overlaps in both the practice and conceptualization of engineering and design.

Both involve solving the problem of what to build. Both rely on a set of heuristics built by experience in the individual practitioners. Both are concerned with trade-offs.

two giraffes facing away from each other
Photo by Vincent van Zalinge on Unsplash

What to build

Solving the problem of what to build in either discipline is about understanding the gap the solution needs to fill.

In engineering, this is usually framed as requirements gathering. They are typically structural requirements of the embodiment (how many cycles in how much time, how much work done with how much resources), restrictions of performance envelope (an upper limit of acceleration, a lower limit in total capacity), or functional conditions (some response must occur whenever an event occurs).

In design, deciding what to build is based on satisfying the judgement of a person. This could be the design themselves (intuitive design), an end user (user-centered design), or a stakeholder (a mixture).

Heuristics

These appear to be poised opposite each other on a spectrum of hard and soft requirements. But that assumes solving the problem of what to build is simply mechanical. Problem solving is creative and involves synthesizing existing solutions in appropriate combinations as well as introducing novel solutions to the context. Both a designer and an engineer rely on a set of heuristics to build a solution, including the introduction of any sort of formal design process.

Trade offs

It is this aspect that ties engineering and design together. Both require space for ideas to be pieced together and evaluated. In any non-trivial situation, the addition or subtraction of an element affects the performance of the solution in a complex way.

A user experience design is not simply a set of steps to walk through. It must consider the holistic experience of many different types of people. It needs to take into account what is practical.

Similarly, an engineering solution is not simply the set of components involved. It isn’t even the much larger set of combinatorial ways that the components could be arranged. It must consider flexibility to meet future conditions and extensibility. A solution must address maintenance and the skills and abilities of the team who will maintain it.

Learning from each other

Both design and engineering involve sending something out into the world, with all the complexities and messiness that exist there. Both disciplines can benefit from each others’ traditional approaches because of their commonality in purpose. Practicing design with an engineering background brings the strengths of formalism and frameworks. Solving engineering problems with the eye of a designer informs a holistic view of what engineering is and what it can do.

In my career experience, the most successful engineers are those that understand and can articulate the design-inspired, user-centric parts of their solution. I am curious to see if the reciprocal relationship exists in the world of design.

Showing Some Work

I recently read Show Your Work by Austin Kleon. It is a short read and I recommend grabbing an electronic copy from your local library and reading it over your lunch hour. Ryan sent it my way and that has been helpful

Kleon provides some practical advice, some of it perhaps a little conflicting, but overall it’s solid. I wrote up some notes and drafted a short review/musing that I’ll post later.

“So what?” as he says.

Well this post is coming from the WordPress app on my phone as a test of an easy way to get my process documented. To fully simulate what I will be posting more of, here is a picture of my workbench.

My workbench, covered in stuff

Starting from the bottom right and going counter clockwise:

  • A Sun keyboard I got for cheap at the recyclers. Unknown if it works
  • IBM Model M that auto switches to XT keyboard protocol
  • Z80 single board computer that I added a second board to… so I guess it’s a TBC not an SBC
  • My eBay power supply next to a power supply I built from parts
  • soldering iron, tools, a little tool holder I designed and 3D printed, oscilloscope
  • LCD monitor for experiments
  • A bunch of project trays. I’ll have to talk about these at some point but the short description is that a project that isn’t finished goes into a tray so the parts don’t get scattered but also doesn’t get hidden and forgotten
  • My KayPro XT compatible retro computing project.
  • My new hot air rework station amongst a pile of junk and parts
  • And finally in the center are my “current” projects: RaSCSI drive emulator and some prototype modular synth modules

In an effort to follow his advice in story telling – This photo tells a story with a three part structure. The tool holder is a completed project and represents the beginning of my ability to design and print useful objects. The RaSCSI and synth modules are what I have completed so far. Their promise cannot be fulfilled until I add their final prototyped features and send them out into the world as complete ideas. The KayPro XT is the future. It is a fully functioning computer with a case and upgraded features. It will become a virtual museum piece, accessible by KVM over the Internet – the first of a handful of machines I want to add to my virtual museum.

So I will be writing more posts from now on. I’ll be integrating this site with my personal site. I’ll be adding links to references and other works. Thank you for reading and feel free to contact me if you’d like to work on something together!

Mission Statement

I have many reasons for starting this blog.  I need a place to document my projects for myself.  I want to have a way to share my projects with others.  A blog seems like a chance to learn to write better.

But the most important reason is that I want a way to encourage the topics in which I am interested.  I hope this blog can be that collection of projects and ideas that I seek.  As someone once told me. “Make your work what you’d like to see out in the world.”