I would like to take a moment to discuss Mozilla's money management. I have seen countless articles criticizing it, and possibly with merit, so let's dive in.

Firstly, what we call "Mozilla" is three (or more) different entities.

The topmost is the Mozilla Foundation, a non-profit American organization founded in Mountain View, California.

It has a board of directors composed of ten people, the chair of which is Mitchell Baker.

Whereas the executive director is Mark Surman.

The foundation's current movement is described as having three phases. The first one is called "Fuel the Movement", active since 2016: the goal is to rally citizens on issues like trustworthy AI, privacy, and digital rights; support activists and leaders shaping the future of our online lives, and shape the agenda for open source research and internet health.

Since 2019 there has been a focus on Phase II: "Focusing on Trustworthy AI". They seem to have produced various documents on how "Trustworthy AI" should be implemented, in a way that's respectful to the user.

And, finally, since 2021+ we also have a third strategy phase, called "transparency, bias and data". Again, there's a focus on AI: how can we make AI decisions transparent, mitigate bias in AI, and so on.

You may notice a surprising lack in mentions of Firefox, or Thunderbird. Indeed, the management of these two products is delegated to two for-profit subsidiaries, called Mozilla Corporation and MZLA Technologies Corporation respectively. Then, we have a venture capital arm, and a subsidiary specifically about it. There are even more, such as Mozilla China, but those are less interesting to us.

All other videos and articles I've seen on this matter usually conflate the Foundation and its subsidiaries into the same entity. I don't think this is particularly effective, even to understand how money is managed. I have thus decided to split up the video and talk about each entity separately.

Part 1: the Mozilla Foundation

Mozilla's financial statements are audited and published as a single entity, i.e., "Mozilla and its subsidiaries", which makes it difficult to distinguish the revenue from the three entities. Though, we do have some information about the Foundation specifically thanks to their 990 form, which refers to the 2023 year. So let's dive in.

One thing we discover is that the total number of employees of the Foundation is 66 people. Also, they estimate to have 10.000 volunteers. I'm not sure how they came up with the number, but sure.

The total revenue is 64 million dollars, mostly thanks to investment income - well, back in 2023 we had a bit higher interest rates than now - and "program service revenue", though contributions (such as donations) and grants still are around 10% of all income.

Expenses were just 39 million, mostly due to "Other expenses" (frustratingly vague), and "Salaries", which makes sense overall. That leaves us with a Renvenue less expenses value of 24 million dollars for 2023. Finally, the total assets currently owned by the Foundation amount to 124 million dollars.

Funnily enough, the "Other income" section is explained on page 8 to be … "other income". Yeah, no shit.

Finally, the Foundation pays the paycheck of Mark Surman, president and executive director, which amounts to 600k dollars yearly, before taxes. Other Foundation paychecks are listed, but this is the highest one.

This amounts to a total of three million dollars. They also pay almost two million to "Mauve Corporate System", which is an Employer of Record company: that is, they employ people on your behalf to make bureaucracy easier, instead of having to create subsidiaries for each country you want to have employees within.

Other two million dollars are spent in contracting on multiple companies. Mission North offers consultations regarding communication in the AI space, Russel Reynolds "help CEOs and boards solve their leadership challenges", Tourchbox is a non-profit digital agency that offers UX and development services, and Pacific is about audio and production.

Then, the Mozilla Foundation has given grants to various organizations. We're talking about grants for "integrating responsible computing and ethics", "support for African school on internet governance", "building and adding features to zeno" (a machine learning project), "closing the AI education gap initiative", "computing ethics", "feminist tech ecosystem", "2023 women's convention", "exposure of surveillance systems in schools", and so on. Grants are usually between 50 and 100 thousand dollars, and they are given to entities that range from universities to non-profits, such as "Lesbians who tech & allies", "the hearth genome", "whose knowledge", and so on.

This is the sort of stuff that will get you under the scrutiny of right-wing folks, but personally, I'm a big fan of, well, helping people and using money to make the world better and fairer for all of us. Finally, the Mozilla Foundation also receives money from its subsidiaries, though not directly.

The 35 million dollars mentioned in the investment income were mostly actually dividends from the Mozilla Corporation, which also pays 18 mils for trademark license agreements. The Foundation also received a gift, grand or capital from Mozilla Ventures, an impact venture fund that's also a subsidiary, of 24 million; 10 million more were given for the same reason by MZL.AI, the AI subsidiary.

This was 2023. It's worth noting that the governance of the Foundation seems to be somewhat changing in recent times. In early 2024, the executive director was announced to be Nabiha Syed, previously CEO of The Markup.

According to Tech Crunch, she sent an email to all employees on October 30th, 2024 announcing that the teams behind advocacy and global programs were laid off, which resulted in a 30% decrease in headcount. Some quick math tells us that this means a twenty-people reduction. Brandon Borrman, the chief of the Foundation's communication, claimed that "the advocacy is still a central tenet of Mozilla Foundation's work and will be embedded in all the other functional areas", though what that means exactly will probably only be clear over time.

In December 2024, the Foundation published its annual report, including the financial audits I've mentioned, plus some talking points from Mark Surman (the director) and others. As he states, "Mozilla is in the mids of reinventing itself, and reinvention is messy".

And, in the next paragraph: Mozilla stands for putting people and communities in control of how technology shows up in their lives. In 1998, that means taking the web ina better direction. In 2024, it means doing the same for AI and making sure that open source wins again in the AI era.

About the "economics of Mozilla", Surman says that the main focus of the Foundation is diversifying income. As we will see later, the vast majority of the money coming to Mozilla and subsidiaries comes from Google and amounts to almost 500M dollars, whereas donations "only" sum up to 14 million. If I had to guess, Mozilla itself isn't too excited to be that reliant on a single company, especially since the US Department of Justice as asked courts to prohibit Google from making search partnerships; this would result in a complete loss of income in the Mozilla Corporation.

It's worth noting that nowhere in these articles - that I could find, at least - is inclusivity or diversification of communities even mentioned. It seems to me like they do want to appear as a more neutral actor, rejecting the left-leaning image they had been associated with.

Nabiha Syed, the executive director, has also written an article, where the main points are: strategic operations, communications, development - although there's no mention of specific projects - products and programs, community and campaigns.

Overall, it should now be clear to you both the brand that Mozilla is trying to build - which is somewhat more detached from Firefox than one might expect - and how it's managing its money too. Apart from the criticism that could be raised for their 2023 inclusivity grants (I'm fine with that, I just know that some other people won't be), I would say the organization is taking somewhat reasonable steps. If the responsibility of Firefox and Thunderbird development is delegated to subsidiaries, which I haven't even touched for now, and which are directed by different people, then your job - as a non-profit foundation - becomes much more vague; you have to give values, you have to give a direction, you have to support the bureaucratic side of things, and so on. However, this only really works if those for-profit subsidiaries take the responsibility that they are given. Which raises the question: how is the Mozilla Corporation doing?

The Mozilla Corporation

Please note that I have not found a way to talk about the finances of the Mozilla Corporation, specifically. They don't have their own report, so I will analyze the "Mozilla and subsidiaries" financial report and sort-of assume that "most" of what is going on is happening in the Corporation. Other subsidiaries will get their own sections.

So, Mozilla total assets sum up to around a billion and a half dollars - again, this is data from the 2023 financial year. They are mostly distributed in various investments, as we'll see later.

The total revenue is 653M dollars, and it increased since last year. Most of it - just shy of half a billion - comes from royalties, which includes the deal with Google to have their search engine be the default on Firefox. We don't know if other royalty incomes add up to it, but we can safely assume that the deal is "almost everything" of that section. Subscription and advertising revenue is 64M dollars; this includes their VPN subscription and Pocket. Interest from invested income is 71M, and contributions were 12M dollars in 2023; if you recall, 9M of that was to the Mozilla Foundation, and the remaining 3M probably originates from other subsidiaries, meaning - and this is a major point - that the Mozilla Corporation does not run on donations -- at all, almost. It's the Mozilla Foundation and other subsidiaries that do so; but not the Corporation.

Let's see expenses then. These were just under half a billion dollars, again, half of which was spent on software development (of everything, from Firefox to Thunderbird to anything else). The remaining expenditures are General and administrative, Branding and marketing, Other program services, and a few mils on Fundraising too, in this order.

This should be somewhat reassuring: 60% of all expenses are on actual software development, and the remaining 40% is general expenses, administrative, branding, and marketing. However, remember that this includes the Foundation figures, and they don't do any development, so within the Corporation, software development expenses are probably higher than that. Say it's 70% development - 30% administration and marketing? That sort of balance does make sense to me.

We also have a breakdown of the costs for each section in subsections. We don't learn much from it, though we can see that almost all money in management and general goes into employee salaries, as you would expect. They have around 750 employees, a bit less than now, given how they fired people since then.

One last thing I want to talk about in the expenses section is the paycheck of the CEO. In 2023, that role was held by Mitchell Baker, who you might remember from the beginning of the video, since she's also the chair of the Mozilla Foundation. For context – she is one of the founders of Mozilla; she started as a lawyer in Netscape in 1994, and helped launch the Foundation in 2003.

However, she stepped down on the 8th of February, 2024 to be replaced by Laura Chambers, acting as interim CEO.

We are not aware of what the salary of Chambers is - again, all the financial data comes from the year 2023 - but we can look into Baker's.

In that year, she had been paid 6.3M dollars; the entirety of that sum was paid by the Corporation, not the Foundation, which is a subtle difference -- but it does mean that she was paid by Google's money rather than our donations, if we want to say it like that. It's a bit less than 1% of the company's revenue.

Her paycheck was the subject of much controversy, especially because it increased significantly over time. In 2018 it was two and a half million dollars, in 2020 it raised to more than three million, in 2021 it was 5 million, and then it reached 7 million in 2022.

So, is this fair? Is she stealing money from us? Or, well, from Google? I'm going to say something unpopular here –

as much as I might not be a fan of today's capitalistic world if you are a company with a half a billion dollar revenue per year, you kind of gotta play the game, and that means having a CEO that is highly skilled and able to manage sort of revenue. Which is costly, but it's an important investment, and - as long as what she pays "makes sense", as in, it's the industry standard - then it's fine by me. But is it? Is she being overpaid for her role, or is that a normal paycheck for a CEO?

This is not an easy question to answer. Taking some data from the Heidrick & Struggles 2023 private equity-backed CEO compensation survey, we see that revenue for companies bigger than 500M dollars is, on average 737k dollars, plus a 687k dollars cash bonus. However, most CEOs are also given part of the shares of the company, and we see that the average long-term equity compensation is 13M dollars. We can even consider the averages in the 251M-500M range, to avoid outliers, but the data does not change significantly.

Note that the Mozilla Corporation does not have stocks. Thus, the entirely of Baker's paycheck is cash and does not include long-term equity compensation. It makes sense then to include to balance that out with a larger cash base compensation, which makes the 6M dollars figure … reasonable? Or, at least, not completely insane.

Overall, I'm somewhat satisfied with Mozilla's Corporation expenditure report -- as much as you can be satisfied with being almost fully funded by a competing product, and the Department of Justice wants to kill that revenue stream. Yeah.

MZLA Technologies Corporation

Let's now talk about MZLA Technologies Corporations.

Since 2020, this subsidiary has been the home of Thunderbird; this helped the project to try to monetize or sustain itself, at times where the parent Foundation was somewhat struggling to do so.

I believe that the MZLA Technologies Corporation - or, just, Thunderbird - should be taken as a reference implementation on how to do Open Source. In 2021 they managed to receive two and a half million dollars in donations, and in 2022 that number skyrocketed to six and a half million.

All of this was done whilst being extremely in touch with the community, publishing frequent blogposts about the development of Thunderbird, dev digest, community office hours, contributor highlights, and more.

Not to mention, they managed to effectively use that money in a complete redesign of the Thunderbird interface that brought it back from 199something to something that actually feels up to date.

And, they managed to collaborate with the K9 mobile mail application developers to merge their products and announce Thunderbird on Android, again sharing a very modern design.

You won't be surprised to learn that in 2023 their donations numbers rose again to eight and a half million dollars, from over 300,000 individual contributors.

Talking expenses, 70% of the money goes to paychecks - from developers to marketing people, whereas the rest goes to infrastructure, donation processing fees, general and administrative, and so on.

It seems to me like MZLA Technologies Corporation found a great way to be profitable and grow the product, and I love it for them. The whole team probably deserves a shoutout, but I'd particularly like to congratulate Jason Evangelho for is awesome work; he spent two years in Thunderbird, from 2022 to 2024 as the main promotion person, and I really saw him fully invested in the project.

Mozilla Ventures

Next up, is Mozilla Ventures.

This subsidiary was announced in late 2021; it started with 35M dollars to invest in companies that shared Mozilla's values of open and user-respectful technologies.

As an example, one of their last investments is "Germ Network", a private chat software where you have full ownership of what you decide to share -- I'd like to explain it better, but I didn't quite understand it.

Mozilla Ventures also heavily invested in trustworthy AI; as an example, their portfolio features Hugging Face, the company that tried to implement an opt-out way for artists not to have their art trained on -- a project that was doomed to fail in how it was implemented, sure, but still.

Again, Ventures does not publish its own financial data, but we do get something (very little) out of the Mozilla and subsidiaries report since it has its own section on investment.

On one hand, as you'd expect, Mozilla invests in government-issued securities, mutual funds, equities, and alternatives. This is the standard stuff -- which we're not particularly interested with, but we get it anyway.

However, there are also non-marketable investments. These "include direct and indirect investments into various early stage, high growth technology companies".

In 2022, the total Venture investments were 15.9M, whereas in 2023 that rose to 21.2M dollars. Thus, either not all of the starting 35M capital was invested, or there were some losses that are now starting to be balanced out. Though, admittedly, I have no clue whatsoever how any ventures work at all, so this is very speculative.

I'll merely point out that this number is extremely low compared to the one billion dollars invested in marketable investments, or compared to the amount of money they have at all. Currently, Ventures does not seem to me like one of the main Mozilla activities.

Mozilla.ai

The very last one I have to talk about is Mozilla. ai; I'll be quick -- I don't have much to say.

Mozilla.ai was announced in March of 2023, by Surman. Mozilla decided to make an initial 30M dollar investment in the company, which again is roughly 5% of their yearly income, and one-tenth of what they spend each year in software development, to put things into perspective.

It also seems to be a one-off expense; I don't know whether further money was sent to it, but I did not find any trace of that anywhere. The company is led by Moez Draief, who "has spent over a decade working on the practical applications of cutting-edge AI".

I have not found anything particularly interesting to say about this particular subsidiary; maybe it's just a bit too soon for anything significant to come out. I'll keep you updated in case anything happens, though.

Thanks everybody for following, and see you tomorrow.