Business models for learning communities

History

On 8 Oct 2009 John David Smith led an Open Space session on Business Models for Learning Communities. Notes from that page are the seed for this page. Josien Kapma and John have been working on this subject for 3 years, since a CPsquare meeting in Setubal.

Legs on communities

• Communities run on energy, not on money.
• That said, communities that do not have a sound economic model cannot be sustainable.
• Our effort is directed towards identifying appropriate economic 'rolemodels' for communities, for supporting autonomous knowledge processes at local(?) level.

History

Communities have always had a need for resources. People invest their time in the community, and things are needed. (eg. photocopies, or drinks at a meeting). Technology also has a cost. Community resourcing has always had its problems: the 'commons' issues, free riders, lack of resources. But not only the lack, also the presence of resources is problematic. Even if non-monetary, resources can create more problems than they solve, such as disagreements about what to use it for, perverse incentives , lack of transparency, distrust among individuals in the core, or between core and constituency. This is worse if money needs to be introduced.

(Why is it different from business?)

Financing

Financing of community is usually not straightforward. It is characterized by complex and sometimes unclear systems of goodwill, favours, old 'accounts' en trust. These are characteristics of resourcing models of communities:

• difficult to understand even for insiders,
• usually many in number (many bits finally add up to a whole),
• sometimes there is 'basket financing', meaning that parts that can be financed are singled out as separate entities (for the sponsor)
• not static,
• feed back from 'the community' is very important,
• there may be cross-subsidies from profitable elements to other elements,
• usually not 100% transparency,
• it often concerns indirect relations (the sponsor is not the recipient of the service)

The leaders of successful communities:

• need to have a true passion and commitment to the constituency
• often do some 'trials', seeing what works, giving away favours or services without knowing what will return,
• have a long term vision.

<image that comes to mind: a complex rich picture with loops for feedback and loops bringing in small benefits. Many small benefits adding up>

What's technology got to do with it?

When the community shifts to use other technology, some elements in this picture scale up and out, but not others: there is a large risk of instability. Eg. with web2.0 technology the feed back loops are drastically changed.

The transition of society as a whole to the networking age makes free access and open systems the norm on the web. For communities, network dynamics come into play: network is of more value if more people are part... but it is also more expensive. who pays, who gets paid?

which are models that work? what are ways to think and talk about it?

case studies:

• cider makers
• euforic
• fadeco radio tanzania
• melken over de grens
• km4dev
• some bloggers

More notes

• The Business Model scheme is useful for learning communities: http://www.businessmodelgeneration.com/
• Specifically it helps
  • Make comparisons more systematic
  • make conversations more orderly
  • Generates useful questions
• Categories may need to be modified, the model revised
• The model has to consider all resources, not just money
• Might blog about or explore further:
  • How is "free" constructed & how it evolves (communities do not get to violate the law of conservation of energy)
  • Soft categories: lave’s pockets of money
  • Pooling resources: how what’s “ours” comes to be ours
  • Community leadership agenda: monthly activities (not just about learning but about the legs of learning)
  • Partners to members touch / kept separate
  • Why money is an undiscussable topic in some communities
  • Transparency: why it’s tricky and needs to be managed