The Cloud Foundry Foundation: The Power of a 501(c)(6)

By: | June 7, 2016
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Cloud Foundry is an open source software project. The software was originally developed by VMWare, then transferred to Pivotal and open sourced in 2014. In 2015, the Cloud Foundry Foundation was created.

Now the Cloud Foundry project assets— code and trademarks included — belong to the Cloud Foundry Foundation, a 501(c)(6) nonprofit organization.

The Foundation holds all the Cloud Foundry IP.

It can never be transferred back to an individual company.

Ever.

What does it mean to be a 501(c)(6)?

It means we are a tax-exempt nonprofit organization, like many other types of 501(c)s. While most people think of tax exemption when they think of 501(c)s, there are certain unique characteristics to a 501(c)(6) that have significant implications for Cloud Foundry as an industry-shaping ecosystem. We are using the collective power of dozens of industry-leading companies to create the open source, multi-cloud platform of the future that is changing the way the world builds applications.

The Basic Characteristics of a 501(c)(6) organization according to the IRS are as follows:

  1. It must be an association of persons having some common business organization interest and its purpose must be to promote this common business interest. Our members have come together to promote Cloud Foundry as the standard multi-cloud platform enabling continuous delivery. Cloud Foundry’s container-based architecture runs apps in any language on a variety of cloud services, including Amazon Web Services (AWS), Microsoft Azure, Google Compute Platform (GCP), OpenStack, VMware vSphere, SoftLayer and more.

2. It must be a membership organization and have a meaningful extent of membership support. The Cloud Foundry Foundation has 63 member companies who provide resources to support the Foundation. They provide financial resources directly to the Foundation as well as developers and product managers to work on the code base. In addition, they provide marketing, advocacy and business support.

At the Foundation, we see our job as amplifying the work of our members, making sure they can work collectively on Cloud Foundry. We make sure there are clear processes for people to collaborate in a cooperative manner. Our processes include a Board of Directors that set business direction, a Technical Advisory Board that advises on long-term technical direction and a PMC Council that sets the roadmap. We ensure that these processes are balanced and support the project.

Our Board of Directors consists of nine executives from across the industry.

3. It must not be organized for profit. The Cloud Foundry Foundation distributes all of the Cloud Foundry code under an open source license free of cost. Our financial support comes primarily from member fees, with additional income in the form of sponsorships for events and certification fees which fund the actual certification program. Certified members are permitted to use the Cloud Foundry trademark if they certify they offer the same core Cloud Foundry software to ensure users get application and skill portability across providers. In the future, the Foundation will offer certification for developers, in order to create an ecosystem of skilled developers to enable the transition to a multi-cloud world.

4. No part of its net earnings may inure to the benefit of any private shareholder or individual. Everything done by the Cloud Foundry Foundation benefits the entire industry of companies using and providing multi-cloud Cloud Foundry solutions regardless of membership status.

5. Its activities must be directed to the improvement of business conditions of one or more lines of business as distinguished from the performance of particular services for individual persons. All intellectual property of Cloud Foundry is owned by the Foundation and can never be transferred back to an individual company. Ever. So we release the source code under an open source license for the entire world to use.

In addition, we hold events, provide training and help with marketing and social media efforts to educate people on the benefits of multi-cloud Cloud Foundry solutions.

6. Its primary activity does not consist of performing particular services for individual persons501(c)(6) members can be companies or individuals. As of this writing, all of our members are companies. Our efforts support the industry as a whole and not any single member or individual.

7. Its purpose must not be to engage in a regular business of a kind ordinarily carried on for profit, even if the business is operated on a cooperative basis or produces only sufficient income to be self-sustaining. We are a 10 person organization focused on the Cloud Foundry project, not on the businesses or services around it. Our financial support comes from member dues and all efforts go into helping grow the ecosystem.

 

It is these seven characteristics that make the Cloud Foundry Foundation a strong, safe home for the Cloud Foundry project to thrive. We are creating the open source, multi-cloud platform of the future so the entire industry can focus on creating apps that run across clouds, deploy in seconds and scale to solve the industry’s toughest problems.

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