7 ms·

So telegram is a non-profit. And they splurge 1M USD? What am I missing? Edit: to clarify, what I meant is that I expected non-profits to make good use of thei

by educar 10y ago

So telegram is a non-profit. And they splurge 1M USD? What am I missing? Edit: to clarify, what I meant is that I expected non-profits to make good use of their money and not give away large sums of money in prize competitions. Certainly, no NGO or non-profit I know of does this. Raises a red flag for me.

hardwaresofton 10y ago
non-profit does not necessarily mean the company does not make profit. AFAIK it just requires that the profit made be spent on the company and/or cause rather than used as dividends or given to what would normally have been shareholders. http://www.investopedia.com/terms/n/non-profitorganization.asp?o=40186&l=dir&qsrc=999&qo=investopediaSiteSearch http://www.investopedia.com/terms/n/non-profitorganization.a...
- jsprogrammer 10y ago
  If the "profit" is consumed by expenses, it is not profit.
  - hardwaresofton 10y ago
    Are you referring to where I wrote "profit made be spent on the company"? If so, I'd like to point out that expenses are not the only way you can spend on a company. Someone may also invest profit that they have made into expansion, for example. "profit" can never be consumed by expenses, by definition (as you have pointed out). Profit can, however, be re-invested in a company, as opposed to being taken by the owner or shareholders, or whatever.
    - jsprogrammer 10y ago
      An investment is an expenditure of money. What part of money set aside for expansion will not go to an expense? Where does it go?
      - hardwaresofton 10y ago
        How I'm understanding is that these things happen at different times. 1. Business operates for X days (1 quarter, 1 year, whatever) 2. Business calculates it's profit (revenue - expenses) 3. Business now has a choice on what to do with it's profit. At t = 3, the profit is not an expense, though it will ultimately be used to benefit the company/cause (if it's a nonprofit). nonprofit organizations must decide what to do with profit, if they have generated more revenue than they have expenses. The difference between a nonprofit organization (from another org) is that the profit must go either back into the company, or into the cause. Arguably, the money that goes back into the company goes into the cause anyway, as it is in service of the cause. Maybe it's just a matter of semantics, I could see it being incorrect to call something "profit" that is never allowed to be spent on anything other than the company/cause. However, the strict definition of profit is pretty bare-bones, simply revenue - expenses, so I think it qualifies.
        jsprogrammer 10y ago
        A nonprofit with profit is a contradiction. I get that some may perform calculations with labels called profit, but that contradicts the underlying thesis of the organization (as you've admitted).
        hardwaresofton 10y ago
        "nonprofit" is a bit of a misnomer -- if you don't take my word for it, please check other sources like investopedia or wikipedia I pasted investopedia already so here is wikipedia: https://en.wikipedia.org/wiki/Nonprofit_organization https://en.wikipedia.org/wiki/Nonprofit_organization Note "surplus revenues", and if you click that, wiki says they're basically the same as "profit" (because... surplus revenue is profit...)
        jsprogrammer 10y ago
        A non-profit would probably need to pre-allocate revenue.
kelnos 10y ago
Profit/non-profit status has nothing to do with how much cash an entity keeps on hand.
JJJollyjim 10y ago
You're missing that the founder also founded VK and thus has a net worth of $260 million (according to Wikipedia)
- fabulist 10y ago
  What is the relevance of VK's net worth to Telegram's decision?
  - ascorbic 10y ago
    Because it's Pavel Durov's money that's paying for this.
    - fabulist 10y ago
      No, that doesn't explain anything. Durov has a lot of money to throw around. Okay. Why did he throw it at something silly when Telegram has real problems? NCC Crypto Services would do a lot of good work for a million dollars.
      - ascorbic 10y ago
        The original comment asked why a non-profit would splurge $1M on this. It's not the non-profit's money though, it's Durov's own, so his net worth is totally relevant.
Sanddancer 10y ago
There are other nonprofits that do similar. The XPrize, for example, has similar contests for space travel. Contests like this encourage groups that may be happily in the shadows to come forward and be bold, and show off what they've been working on. The money definitely will help, but creating names can be more worthwhile.
cloudjacker 10y ago
You are confusing this with the people in non-profits using that as an excuse to be cheap
unlinker 10y ago
By now I haven't heard anything of how they make or will make money. It's like nobody addresses that. I know a messaging app is not exceptionally expensive to run but still. Anybody has any hints?

by educar 10y ago

hardwaresofton 10y ago

non-profit does not necessarily mean the company does not make profit. AFAIK it just requires that the profit made be spent on the company and/or cause rather than used as dividends or given to what would normally have been shareholders. http://www.investopedia.com/terms/n/non-profitorganization.asp?o=40186&l=dir&qsrc=999&qo=investopediaSiteSearch http://www.investopedia.com/terms/n/non-profitorganization.a...

jsprogrammer 10y ago
If the "profit" is consumed by expenses, it is not profit.
- hardwaresofton 10y ago
  Are you referring to where I wrote "profit made be spent on the company"? If so, I'd like to point out that expenses are not the only way you can spend on a company. Someone may also invest profit that they have made into expansion, for example. "profit" can never be consumed by expenses, by definition (as you have pointed out). Profit can, however, be re-invested in a company, as opposed to being taken by the owner or shareholders, or whatever.
  - jsprogrammer 10y ago
    An investment is an expenditure of money. What part of money set aside for expansion will not go to an expense? Where does it go?
    - hardwaresofton 10y ago
      How I'm understanding is that these things happen at different times. 1. Business operates for X days (1 quarter, 1 year, whatever) 2. Business calculates it's profit (revenue - expenses) 3. Business now has a choice on what to do with it's profit. At t = 3, the profit is not an expense, though it will ultimately be used to benefit the company/cause (if it's a nonprofit). nonprofit organizations must decide what to do with profit, if they have generated more revenue than they have expenses. The difference between a nonprofit organization (from another org) is that the profit must go either back into the company, or into the cause. Arguably, the money that goes back into the company goes into the cause anyway, as it is in service of the cause. Maybe it's just a matter of semantics, I could see it being incorrect to call something "profit" that is never allowed to be spent on anything other than the company/cause. However, the strict definition of profit is pretty bare-bones, simply revenue - expenses, so I think it qualifies.
      - jsprogrammer 10y ago
        A nonprofit with profit is a contradiction. I get that some may perform calculations with labels called profit, but that contradicts the underlying thesis of the organization (as you've admitted).
        hardwaresofton 10y ago
        "nonprofit" is a bit of a misnomer -- if you don't take my word for it, please check other sources like investopedia or wikipedia I pasted investopedia already so here is wikipedia: https://en.wikipedia.org/wiki/Nonprofit_organization https://en.wikipedia.org/wiki/Nonprofit_organization Note "surplus revenues", and if you click that, wiki says they're basically the same as "profit" (because... surplus revenue is profit...)
        jsprogrammer 10y ago
        A non-profit would probably need to pre-allocate revenue.

kelnos 10y ago

Profit/non-profit status has nothing to do with how much cash an entity keeps on hand.

JJJollyjim 10y ago

You're missing that the founder also founded VK and thus has a net worth of $260 million (according to Wikipedia)

fabulist 10y ago
What is the relevance of VK's net worth to Telegram's decision?
- ascorbic 10y ago
  Because it's Pavel Durov's money that's paying for this.
  - fabulist 10y ago
    No, that doesn't explain anything. Durov has a lot of money to throw around. Okay. Why did he throw it at something silly when Telegram has real problems? NCC Crypto Services would do a lot of good work for a million dollars.
    - ascorbic 10y ago
      The original comment asked why a non-profit would splurge $1M on this. It's not the non-profit's money though, it's Durov's own, so his net worth is totally relevant.

Sanddancer 10y ago

There are other nonprofits that do similar. The XPrize, for example, has similar contests for space travel. Contests like this encourage groups that may be happily in the shadows to come forward and be bold, and show off what they've been working on. The money definitely will help, but creating names can be more worthwhile.

cloudjacker 10y ago

You are confusing this with the people in non-profits using that as an excuse to be cheap

unlinker 10y ago

By now I haven't heard anything of how they make or will make money. It's like nobody addresses that. I know a messaging app is not exceptionally expensive to run but still. Anybody has any hints?