Serving Drupal’s opportunity
The release of Drupal 8 creates many opportunities for organizations worldwide to build something amazing for complex web solutions, mobile, SaaS, the Internet of Things, and so much more. The Drupal Association is excited to work with the community to create these opportunities.
In our mission to support the Drupal Project, the Association unites our global open source community to build and promote Drupal. We do this primarily by using our two main resources: Drupal.org, the center of our community’s interactions, with 2 million unique visitors a month; and DrupalCon, which hosts over 6,000 attendees a year and provides the critical in-person acceleration of ideas.
Both foster the contribution journey that makes amazing software, and the evaluator’s adoption journey that encourages people to use Drupal across industries to create amazing things. As I mentioned in my recent blog post, achieving our mission helps the community thrive into the future and realize their Drupal dream.
With the release of Drupal 8, we have an opportunity to reflect on how the Association leverages these assets to work for Drupal’s current and future opportunities. Working with our board of directors, we determined that the Association needs to:
- Re-assess the Project’s needs, and find new ways to support and meet those needs
- Address a structural issue, to be a more sustainable organization
To do this, the Drupal Association board and I made hard choices. Having invested heavily in supporting the Drupal 8 release and exhausting available reserves, we recognize that the Association now must right-size the organization and balance our income with our expenses. The biggest impact is the elimination of eight positions, reducing our staff size from 25 to 17 employees. Also as part of this reduction, we have reorganized staff to better address the Project’s needs now that Drupal 8 is released.
While we do have our eye on a bright future for the Project through these changes, we’re also painfully aware that we’re not just eliminating positions. We’re saying goodbye to eight people who are important to us—whose contributions we value more than we can describe. We’re impacting the lives of people we care about—people who’ve given a lot to the Project and to others in our community.
Making the Drupal Association sustainable
In early 2014, the Association began investing reserves in building an engineering team for two main reasons: to address critical issues that were slowing down the production of Drupal 8, and to modernize Drupal.org. In doing so, we purposefully created a structural deficit, with the hopes that we could grow revenue to meet the cost of this investment before we drew down our reserves.
Because of this investment, we were able to accelerate the release of Drupal 8 through a roadmap of features like semantic versioning, DrupalCI (continuous integration testing for the projects we host), better search and discovery capabilities, numerous issue queue improvements, and issue credits, all of which positively impacted the release of Drupal 8. In addition, the engineering team has addressed years of technical debt and incorporated more modern services in the site that have made it more reliable and faster around the world.
While revenue grew from 2014 to 2015 by 14%, it didn't grow enough. Last year, we acknowledged that we did not meet the revenue goals that would sustain this investment. We addressed it with a retrenchment designed to extend our runway and see if we could increase revenue sufficiently. All told, while we have accomplished both revenue diversification and growth, it wasn’t enough to fully replace the investment. Then in spring 2016, several things happened on the revenue front that created a significant budget gap:
- Sponsored work: The Association funded Engineering resources by accepting sponsored work to build Composer endpoints for Drupal projects. After that project was completed, we were unable to line up an additional sponsored project to continue underwriting the Engineering team.
- The Connect Program: This new experimental program designed to connect software companies with service providers for partnership and integration opportunities did not meet its revenue goals.
- DrupalCon: DrupalCon New Orleans ticket sales did not reflect the increase we were expecting this year, and we have revised our DrupalCon Dublin ticket sales projections accordingly.
"CAGR" means compound annual growth rate.
2016 data is projected revenue and expenses.
Addressing this structural deficit required a reduction of both labor and non-labor expense. Labor is our biggest cost, and we can’t create alignment without cutting roles at the Association. Holly Ross, our Executive Director, Josh Mitchell, CTO, and Matthew Tsugawa, CFO, offered to step down and contribute their salaries to the reduction, as they saw that a smaller organization doesn’t require a full leadership team. Additionally, we are losing three staff members from the Engineering team, one from the Events team, and one from the MarComm team. We are working with these staff members to help them through their transition.
Our second biggest expense is rent. We are working to eliminate the physical office in Portland, Oregon—moving staff to a virtual, distributed team—but those efforts will likely not introduce savings until 2017. We already work with distributed staff and community members around the world, so we have the know-how and tools like Slack and Zoom in place to support this change when it happens.
While these staff reductions are painful today, they correct the structural problem, bringing expenses in line with income. We have conservatively reforecasted revenue to reflect any impact this staffing reduction may have. We can see with our forecasts that the layoffs result in the Association being on healthy financial ground in 2017.
What happens next?
Leading up to now, we invested in tooling to help the community release Drupal 8. Now that Drupal 8 has shipped, the Project has new needs, which are:
- Promote Drupal 8 to grow adoption
- Sustain Drupal.org so the community can continue to build and release software
Drupal.org is our strongest channel for promoting Drupal, given that it’s the heart of the community and organically attracts hundreds of thousands of technical decision makers. It provides the biggest opportunity to guide evaluators through an adoption journey and amplify Drupal’s strength in creating new business opportunities through solutions like “DevOps and Drupal” or “Drupal for Higher Education.” These new services on Drupal.org will help evaluators, create value for our partners, and increase revenue for the Drupal Association.
We can also use Drupal.org to better promote DrupalCon. It’ll help grow ticket sales and attract more community members to that special week of in-person interaction, accelerating their adoption and contribution journeys.
Additionally, we’ll expand our efforts to attract more evaluators to DrupalCon. We can accelerate their adoption journey through peer networking and programming that helps them understand how Drupal is the right solution for their organization. We do this today with our vertical-specific Summits (like the Higher Education Summit) and we can do more through relevant sessions and other special programming. And while the Drupal evaluators are there, we’ll connect them with Drupal agencies who can help them realize their Drupal vision.
One thing about our work won’t change: our commitment to the tools you use to build Drupal every day. Though the Engineering team is smaller after today, they will make sure the tools and services you need to build and release the software are supported. That includes things like the issue queues, testing, security updates, and packaging.
Right now, we’re focused on the team as we go through this transition. Once the transition is complete, we’ll be looking at the Project needs and making sure we align our work accordingly. When we make changes, we’ll be sure to keep the community updated so you know what our primary focus is and how we are working towards our vision of Drupal 8 adoption across many sectors.
In the meantime, I invite you to tell me your thoughts on this new focus and how the Drupal Association can best help you.