What is Open Collective & how it works?



What is an Open Collective?

An Open Collective is a group of people with a shared mission that operates in full transparency. Everyone can see how they receive or spend money.

What can I do with Open Collective?

  • Set up a page to collect membership fees or donations (like this one)
  • Let your members submit expenses and reimburse them with a click (example)
  • Give everyone visibility on your budget (example)

If you have an organization, you can use Open Collective to empower local chapters to raise money locally and have their own budget. See Open Collective For Organizations.

What is Open Collective good for?

Open Collective is perfect for any project that is not for profit. Side projects should be fun. You shouldn’t have to worry about creating and maintaining a legal entity, doing bookkeeping, etc. as soon as you need to collect money to reimburse your expenses. Open Collective is ideal for meetups, open source projects, parent associations, neighborhood associations, clubs, unions, movements, non-profits, business incubators, etc.

Why should I use Open Collective?

Open Collective makes it easy to be transparent about your finances. We help you collect money recurrently for your community. Think about funding an ongoing open source software, collecting dues for a parent association or charge a monthly fee for your food coop. Once you have the money on Open Collective, it’s easy to spend it and everyone can see how it’s being spent. We believe that financial transparency in a community will create stronger and more efficient collaboration among people.

How is that different from other crowdfunding platforms?

Two major differences:

  • Open Collective helps you raise money recurrently (e.g. monthly) to finance the activities of your community, without needing a legal entity or bank account. That way, you can plan your future activities against your anticipated monthly budget.
  • Open Collective allows (and encourages) full transparency and accountability of the money raised. Other platforms hand over the money without showing to the backers how their money is used. On Open Collective, in order to use the money, you submit an expense for everyone to see. We believe transparency leads to healthier organizations.

How does it work?

When you create a collective, the money collected goes to the bank account associated with the collective. Whenever you –or a member of the collective– wants to use the money, they submit an expense on the public page of your collective (like this one). Once you approve it, the person who submitted the expense is automatically reimbursed on their personal PayPal account. The budget and all the expenses are visible publicly.

How much does it cost?

Open Collective takes 10% + credit card fees (usually 3% + $0.30/transaction) of the money raised by the collective for the platform use + managing their bookkeeping, taxes, and the admin of reimbursing their expenses. We share this commission with the host organization (the legal owner of the bank account that holds the money on behalf of the collective).

What happens to the money if I close my account?

The money in your PayPal account associated with your Open Collective stays there.

Is there a minimum time we have to keep our Open Collective running?

No minimum time is required.

How do I make a donation?

You rock! We are delighted you are asking this question. Go to the Collective’s Public Page (e.g. https://opencollective.com/wwcodeatl), choose your recurring donation amount and hit the Back Us or Donate button, fill out the form et voilà! Now you are part of that collective, your community will appreciate it.

How do I submit an expense?

Go to your Collective page to submit an expense. You will need to upload a valid image for it to get reimbursed. Don’t forget to include your paypal email if it’s different from your user email.

There are two ways of using your Collective’s money:

  • Submit a receipt for something you paid like online services, meals, plane tickets, etc.
  • Submit an invoice for your work. The invoice must include your current address and be made to Open Collective Inc. (or to the host if you are hosted by another organization) with reference to your collective. The invoice is only visible to the host and core contributors, it is not public.

Expenses will be paid once a week on Fridays. Please contact Support if you have any questions.

Why do you have monthly payments as default?

A collective is an organization of people working together towards a common goal. Sometimes these goals take a few months and sometimes they can take years. By supporting a collective with a recurring monthly amount, you help the collective plan out its future activities.

Why do you charge recurring monthly subscriptions on 1st of every month?

It helps our collectives manage their monthly budget. Instead of getting donations randomly throughout the month, they can start a month with a minimum budget for that month. Any new donations during the month only improves their budget.

We would also like to eventually move to charging a single payment for multiple monthly donations from the same user. Fewer transactions means less fees going towards payment processors and more for collectives. Stay tuned for updates on that in the near future.

How can I cancel my monthly donation?

We are sorry to see you go! Go to opencollective.com/subscriptions to manage your subscriptions.

Where can I report a Collective?

We strive to keep our community healthy, safe and in line with our mission. If you wish to report a collective’s activity please email us report@opencollective.com

Why is my Collective not able to receive donations yet?

We are thrilled you have created your Open Collective! We are still in private beta and we have a selection process to ensure the quality of the collectives our users can back before they are active to receive donations. We are working hard to get everyone aboard!

What are your Terms of Service?

You can see them here.

Can’t find the answer you are looking for?

Shoot us an email at support@opencollective.com or drop by our Discord.

Who are your investors?

We raised a total of $805k so far on convertible notes (SAFE) you can find them here.