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Frontend Development / Open Source / Software Development

GitHub Sees Open Source Organizational Donations Spike

Github recently changed how organizations can donate to open source projects on its site. That’s led to a spike in donations via invoicing.
Jun 22nd, 2023 9:13am by
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Approximately 90% of companies use open source in some way, according to GitHub. “We’re a long way from seeing that directly translate into financial support,” the company noted in a blog post.

In fact, an organization sponsoring a project is worth 15 times more to maintainers than the average individual sponsorship, according to GitHub, which recently made it easier for organizations to donate to projects by adding support for sponsoring open source projects at scale, invoice payments, a dashboard for budget insights for invoice customers, and sponsorship history.

Since its new features were made generally available in April, the number of organizations using invoices to sponsor has almost doubled, Stormy Peters, GitHub’s vice president of Communities, told The New Stack. There’s also been a wide variety in the types of organizations signing up, from smaller businesses to very large organizations. To date, more than 3,500 organizations have funded open source through GitHub Sponsors, including AWS, American Express, Stripe, Shopify and Mercedes Benz.

“We’ve offered organization-funded sponsorships in various forms — via credit card, through our beta, and now via purchase orders and invoice –— but what is unique about our most recent announcement, and our path forward, is our focus on meaningful contributions,” Peters said. “Our goal is to remove friction and raise awareness so that organizations can sponsor at scale, contributing to the health of both the organization and the maintainers, and projects they rely on.”

The Significance

While in the beta, GitHub saw growth in direct funding.

“In 2022, nearly 40% of sponsorship funding came from organizations, with each organization-funded sponsorship worth on average nearly 15 times more to maintainers than the average individual sponsorship,” the blog post stated.

GitHub’s support for organizational sponsorships is a significant move, according to Peter McKee, a veteran software engineer and head of Developer Relations at SonarSource, an open source and continuous code quality and security company.

“It’s very hard to make a living full time as an open source engineer,” McKee told The New Stack. “They rely on contributions from the community. Large corporations are using these tools day to day in all their applications, from internal line of business applications to external facing applications. If they support those, those engineers, they’ll produce more quality code and everybody wins.”

McKee has seen a shift in the past 5-10 years over how organizations view open source. Once prohibited in many shops, its use is now more widely embraced today as companies realized they didn’t have to reinvent the wheel to have quality, working code.

“Engineers are the new kingmakers, so to speak … and we don’t fall in line very well,” McKee said. “The open source engineers and other software engineers saw the value in it and started using it and just kept moving on, and slowly over time organizations realized that, yes, there’s some risk, but the advantages outweigh the risks.”

Organizational Invoices Nearly Double

Organizations increasingly appreciate that dynamic and want to support the projects they depend upon, according to GitHub. To encourage that goodwill, GitHub announced bulk sponsorships in April, which is new tooling that lets organizations sponsor all or some of their dependencies at once. Bulk sponsorships are built into its GitHub Explore Sponsors page so that organizations have an easy way to get started with their sponsorable dependencies at hand — they’re now exportable as a CSV, too, Peters said.

“Since the announcement in April, we’ve almost doubled the number of organizations using invoice to sponsor,” Peters said. ”We’ve also seen a wider variety of types of organizations sign up, from small businesses to very large organizations.”

Organization owners and billing managers can sponsor accounts on behalf of their organization, as long as the receiving developer has an active sponsor account. If an account is sponsorable, their profile will include a “Sponsor” button next to its name. If an organization wants to sponsor via invoice, GitHub requires a verified email address and the ability to spend a minimum of $5,000 per year, however, there are no special requirements or criteria for organizations wanting to sponsor via credit card, except of course that the receiving account is sponsorable.

Organizations paying by credit card pay a 6% fee made up of a 3% credit card processing fee and a 3% GitHub service processing fee, while organizations paying by invoice are only subject to the 3% GitHub service process fee.

Not surprisingly, software companies have been more inclined to support open source development, as are companies that have an open source program office, Peters said.

Peters also shared the testimonial of developer and tldraw founder Steve Ruiz on what the new organizational sponsorships meant for his project.

“GitHub Sponsors provided me with a ton of early validation for tldraw,” Ruiz said. “I might not have even tried to build a startup around tldraw without that validation — and I doubt it would have worked without the mix of individual and corporate sponsors backing up my pitch. The program gave me a great reason to create content and community around tldraw. I’ve been very public about who is sponsoring me so it’s been a way for my sponsors to grow their communities too.”

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TNS owner Insight Partners is an investor in: SonarSource.
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