Protei INC and Open H2O

Do you want to transform your idea into an Open Hardware Technology for the Environment? And why not into a business or a non-profit organisation? This is how we are doing it. I am not saying it is the best, but it is our preferred way.

General strategic motivations

In the last months, “Open_Sailing” changed name to become “Open-H2O” to cover a larger scope of interest, and “Protei” -that I started alone as a lab of Open-Sailing lab 2 years ago- is going from a purely research project to become a small industrial robotics startup as “Protei INC”. I want to step back and consider the history of the work over the last years, explain the deep transformations we are going through and what motivates our decisions today.

20121204Open_Sailing-- Open-H2O --

On one side, we have Open-H2O a large non-profit focused on developing Open Technologies to explore and protect the oceans.
On the other side, we have Protei INC a small lean robotic start-up that is going to manufacture, distribute and support beta Protei products.

The separation of the 2 entities have been drafted a year ago here, but what follows is a description of that separation with more details. At the time, this idea of many small companies spawning from an inventors groups (such as squidlabs) or forum (such as instructables) was the most inspiring model.

Open Hardware for the Environment.  Open-H2O + Protei + other Invited Open Hardware projects for Water applications

There are many reasons why we are opting for 2 structures (instead of one hybrid) model to develop Open Hardware for the Environment. This is a big list of pros, and a short list of cons with examples from other companies from which we want to learn from, both in their successes and difficulties. But what I am mostly interested in here, are your comments to help us all improve. Based on your comments I might come back and edit these posts, adding references, better examples, adding paragraphs, correcting grammar and spelling, as this is part of my PhD research at Goldsmiths University in London.

This text goals are :

  1. For Open-H2O, Protei members and our partners to understand these transformations we are going through. It is necessary to explain why 2 entities are born of one, meant to live their own lives, yet to grow and support each other.
  2. To contribute to Open Hardware as a movement, on the questions of Entrepreneurship, document our story to encourage more and more cool projects to turn into resilient and flamboyant Open Hardware Tech Start ups all around the world.
  3. Open a discussion on what are the best strategies to develop structures for Open Hardware for the environment. The stake of this being how to turn the next industrial revolution into a civilisation shift that creates technology for the environment instead of destroying it.

Inventors, Makers, Hackers, Environmentalist, Researchers, Engineers, Students, Retired and active Professionals, Housewives/men, kids, hobbyist, you, ALL HANDS ON DECK.


Non-Profit Resilience & Risky Business

Separating the technology community (Open-H2O) and the manufacturing company (Protei INC) guarantees that even if the manufacturing company goes bankrupt, the community and the technology will continue to thrive for the environmental benefit. If a company fails using open hardware technology licensed by a non-profit, another company can be created by the same or other people. A good example of such resilience is DIY drones, a web community that spawned the wonderful  3D Robotics manufacturing group, the 2 entities having a robust symbiotic relationship with one another.

Research autonomy and Integrity

I have spent the last 8 years in different lab Environments (from art to science) in different countries, at post-graduate level either as a Student, Researcher, Project Leader, Professor Assistant and Invited lecturer. Many of the projects I have been involved at the University have been supported by external sponsors, often in related industries. I can say from experience that most sponsorship allowed us to work freely and produce independent research, but I can also say that several times the researcher freedom and autonomy, as well as the integrity of the research material produced has been altered by an unsuitable relationship between academia and industry. It is vital that research stays free from industrial and manufacturing constraints, as well as the industry needs to be able to meet its goals, often dictated by strict market imperatives and dynamics.

To my point of view, a positive civilisation progress has been achieved with the separation of the church and the state, that guarantees that a state will distinguish what is relevant of faith or reason. Similarly the separation of manufacturing and research is to bring significant benefits.

  • Open-H2O is for research, it produces ideas designs and prototypes. It is where diversity of non-converging arguments only creates more value to the community and the possible development of multiple technologies in a democratically-led organisation.
  • On the other Hand, Protei INC is for lean manufacturing of robots. It needs to be univocal, productive, focused and competitive. The corporation structure of the company would be identical the chain of manufacturing, a chain of command, optimised for production.

As you can see the 2 entities have radically different objectives and requirements, it made sense for us to separate the 2 activities, to have more research freedom on one side, and being more productive and profitable on the other side.

Open-H2O corporate structure
Open-H2O : research oriented, a hybrid of an academic structure and how the website/community services are deployed, each of us being responsible for one part of the website content.

Protei corporate structure
Protei INC corporate structure. Minimal 3 Board of director piloting all the manufacturing operations that might be generally sub-contracted to external manufacturers.

Cycles of Innovation

Industry has high security standards, Academia has publishing standards, initial research can be fast, many research projects take forever, some products are simple enough to be launched in a few days, some require years of costly R&D.

Protei_001, 002 and 003 were built by Cesar Harada alone in a garage in New Orleans in less than a month, costing respectively 400, 300 and 150 USD in raw materials. Protei_006 was built in Rotterdam by a team of ~10 brilliant engineers from all around the world over 3 months and costed about 25’000 Euros in raw materials, with a production budget of almost 60’000 Euros total if we include transport of the team and machines, food, stipend, insurance, rent of the factory, machines, testing sessions… The cost of developing a machine / technology / science experiment varies greatly and each researcher has his style and schedule. Cesar loves iterating fast with prototypes with methods inspired from experimental physics, some other people prefer to work a long time on the theory would they ever touch a tool in the workshop or go to the water. Both methods are valid for research and produce different outcomes.

Colllaborative dev Of Protei

I personally think it is acceptable to spend so much money and time on research because the whole of point of research is that the outcome is uncertain. The outcome of manufacturing is determined at the beginning of the manufacturing process.

A scientist would set up an experiment of which the expected outcome would be A, B or C, but is generally even more valuable is the outcome is D, opening to even more questions and possible outcomes. On the other hand, the manufacturers will need to validate A, B, C in a determined time and budget as part of an optimisation process. The research process opens up from a question, adding to the number of options ; manufacturing optimisation closes down the number of options, a deductive process towards an ideal product.

Practically speaking, we are talking about different profiles and personalities here, and some would draw there the  line between the scientist and the engineer : one that dreams, invents and explores and one that rationalise, optimise and produces. Some people can do both, some are much better at one than the other, but that’s what makes me believe the relationship between research (Opem-H2O) and industry (Protei INC) can be so fruitful, working at different speed with different methods or related subjects.

People management

In terms of “Community Management” (Open-H2O) and “Human Resources” (Protei INC), the structures are totally different. In Open-H2O, members have to tolerate their differences ; in Protei INC the manager needs to be able  to decide what is produced and for how much, by who, when, where and how (process). As the CEO of Protei INC I want to be able to decide who I work with, pay people to work on what I know is relevant for the company. As a researcher in Open-H2O I have to appreciate and learn from divergent opinions and theories.

My experience is that it is possible that an open source project would self-regulate itself if members have a common goal (having an influent leader and/or a strong and simple vision helps) but I found that many people attracted to “open source” projects tend to be really nice, open minded but undisciplined. That’s not always true, but generally true in my experience, and that gets more true if people are not paid, some will think they can do whatever they want and not tolerate any form of authority : open source does not mean anarchy. Open source projects needs moderation and often even smarter/more subtle management techniques and close follow up. One of my favourite talk dealing with managing an open source community : “Google I/O 2008 – Open Source Projects and Poisonous People” by Brian Fitzpatrick and Ben Collins-Sussman (Google 2008)

Guarantee of Openness of the technology through Open Hardware H2O licensing

Having the IP licensed by a non-profit, guarantees the un-retractable openness of a technology. That means essentially being faithful to the community and the original founding ethical values.

A good example of this is the relation between the Mozilla Foundation (non-profit) and their main community generated product Firefox (free open source software). The Mozilla foundation being a non-profit guarantees that the code remains “eternally” open even if the commercial activities were to fail. Thousands of people continuously voluntarily contribute code understanding it is a collective effort for general interest.

A counter example would be recent events at Makerbot industries. Makerbot has been producing amazing open hardware 3d printers, but after significant external investors and functioning on heavier structural cost (adding admin, legal, machines, rent, salaries etc) making the machine “less hacker friendly, but more user friendly”, the price tag of the machine had to go up. Eventually another manufacturer entered the market announcing they would produce a copy-cat technology faster and cheaper. Not cool, not following “the [unspoken] rules of Open Hardware“. Makerbot industries had to close the source of the project, at the disappointment of many in the Open Hardware community. Being a respected brand and Open Hardware is great, but it might be more critical to be the best, fastest and cheapest in the market. I believe that’s made easier by separating the cost of research and manufacturing to prevent being step on by a vulgar copy cat cloner. We do not want that to happen to us, ever. To finish, I really want to give respects to the Makerbot team for all they’ve done for the movement, by linking to the response on the topic by Bre Pettis.

Cost, concurrence and niche markets

We have 2 main lessons to learn from the example above:

  1. Having too much overhead such as structural cost and investors expecting generous financial returns will increase the price tag of your devices, making us less competitive as our clients would have to pay for our shareholders/investors appetites, our rent, machines, staff, taxes, time of R&D, administrative, legal and web services. That’s why we want  to minimize investors, rent, machines, staff as they already exist outside of us : we are set to be a lean manufacturer by working with existing manufacturers – except for what is specific to your technology. Starting open and going closed is a process in which one may loose the trust of one’s community ; when you could (and probably should) have been growing at the same speed and powered by our community (ala DIY Drones + 3D robotics that operated like a small business and had –until recently– no external investors).
    In the context of exponentially accelerating technologies and under media pressure, we needs to make the choice to either step back into the closed “old world” of monopoly or, open even more our research on one side, and on the other side being extremely lean and adapt one’s strategy day after day, embracing concurrence, moving with whoever is the fastest and cheapest. If a technology is good, open source and well documented, it’s likely someone will duplicate this technology without any research and development overhead, to manufacture cheaper, faster and probably better. Allow everyone to enjoy the technology you are developing, but be the first to do so (more details in “Public and Private information : a question of timing” paragraph).
  2. Being a commercial manufacturing entity does not encourage a community of volunteer contributors to develop the technology, being a non-profit with environmental goals does (more). Investors do not make your technology progress as much as our community does : we must “feed” and nurture it, we are the community. It Is not tax free R&D, we will have to invest thousands of hours of our time supporting our community in time, money, intellectual and emotional support.

What will happen is that our community will become our main gateway for our clients (“prosumers“), technical support (forum), R&D, service providers, consultants and employees. Open Hardware enables you not only to develop a technology, to build a product, but a market, a community, contribute to a positive movement. It confirms the validity of the Long tail theory (Anderson 2004 ), fortifies a brand identity and structures a well connected and supportive community around your technology. It is a long term investment.

Public and Private information : a question of timing

  • Open-H2O is doing research, produce intellectual material, designs, prototypes and experiments. The information is published continuously and made open instantly as it happens, for general interest.
  • Protei optimises for manufacturing, and manufactures robots. It publishes manufacturing ” trade secrets” only the day the product is made available for sales on the market.

Why is that?

  • Open-H2O wants to be competitive on the knowledge market and guarantees so by publishing daily, remaining constantly at the very forefront of technology development.
  • Protei INC manufactures robots, that implies that between the time the machine is optimised and produced, a delay is created. This delay would allow a concurrent manufacturer -that already has the production chain in place- to bring to market Protei copycats faster, cheaper and probably better. The buyers would buy the concurrent robots earlier than Protei could sell its stock : all the overhead of Protei INC would be lost. Bankruptcy.

The necessary measures to counteract  this are simple :

  • At Open-H2O, all the development process of new technologies are immediately published and publicly available under the Open Hardware H2O License.
  • At Protei INC, all documentation is private until Protei INC products are released on the market with their full documentation.

That temporary “unfair advantage” of keeping manufacturing information secret until public release is the condition of Protei INC to survive and support the Open-H2O community.

Compatibility in funding and taxes

  • Open-H2O is developing a technology, namely Protei.
  • Protei INC is manufacturing products, Protei Robots.

So :

  • Anyone can use Protei technology for the benefit of the environment, that’s a work of general interest and therefore fullfils the mission of a non-profit.
  • On the other hand Protei INC manufacturing Protei robots is a commercial activity.

But the distinction between a Technology for general interest, and Protei as commercial product is what ultimately differentiate the non-profit Open-H2O and the profit Protei in the eye of the IRS (tax office).

  • It is right to say “Protei technology is developed by Open-H2O and Protei robots manufactured by Protei INC”.
  • It is NOT right to say “Protei robots are manufactured by Open-H2O and developed by Protei”.

Protei INC and Open-H2O are 2 entities that are very different legally and from a tax perspective.

A corporation is expected to make a profit that will certainly be taxed, a non-profit also needs to make money but must re-invest that money in activities which fullfil a mission the state approves as of general interest to the community.

Compatibility in sources of funding

Sources of typical income :

  • Open-H2O : small donations, large donation (philanthropy), Research Grant, Education programs, professional tax donation, sponsorship…
  • Protei INC : sales of robots, operations, data, environmental clean-up service, manufacturing grant, sponsorship, customer service, consulting, Investment…

Having 2 groups contributing under different aspects of the same technology allows the technology (in general) to receive a greater variety of sources of funding.

  • A C-corp (Protei INC) can donate tax-deductible money to a Non Profit (Open-H2O).
  • A non-profit (Open-H2O) cannot donate money to a Profit (Protei INC), BUT a non-profit definitely needs to buy things and services to exist, and operate.
We are in a transition phase, so this is in practice how we are going to operate until Open-H2O becomes fully independent and recognised non-profit  and tax exempt.

Protei and Open-H2O financial scenarios

Some people have been arguing that a B corp would be the hybrid we are looking for, but according to a recent article in The Economist “There is no tax advantage to being a B Corp, but there is to some of the new legal structures.”

  • Traditionally people are used to volunteer time, work and do tax-deductible donations to a non-profit.
  • And traditionally people are used to work for money, and pay taxes when interacting with a for-profit.

Instead of making a “suspicious hybrid”, I find it easier to conform to the way people are used to operate and simplify our relation to the tax office.

To avoid conflicts of interest between the 2 structures regarding decision-making and tax breaks, so it makes sense for me not to be directing both structures. I am the director of Protei INC, Gabriella Levine is the President of Open-H2O. In Open-H2O I will be directing the technology development, in Protei INC Gabriella Levine is the COO. In some instance we are not able to vote decisions that could present direct conflicts of interest between the 2 organisations.

Open Hardware for the Environment : a call.

Anyone reasonably informed today understands that we are going through a major cultural shift. Capitalism and logics of egoist accumulation have led to the destruction of the environment, and as the number of humans on earth does not cease to grow, worst case scenari beckons. The scale of environmental man-made damages suggests that we need to envision new scalable collective solutions. Everything humans do is a form of technology, so it is technology itself that needs to radically changed to revert the adverse effects on our environment. I propose this axiom to get closer to that “ideal paradigm” :

“If a technology is good for the environment, it should be made available for everyone to use, modify, distribute.”

That is simple enough to call for a volunteer action and establish a consensus among a group of individuals to work together towards a common objective.

The prospect of a shared prosperity with green open technologies

HSBC Campaign

A growing number of environmentalists and economists converge to say that “in the future, there will be no difference between waste and energy” (HSCB Advertising 2012). A practical example of this is seeing the Pacific Ocean Plastic Garbage patch as an enormous storage of energy. I have been quoted “if we had the power to create these problems, we may have the force to remediate these problems […] using natural forces to remediate man-made problems”. Using natural forces -as Protei does- is one thing, but harnessing collective intelligence and appetite for profit is another powerful one.

The idea really is to exploit capitalism and individual greed for environmental good. When I say that Open Hardware technologies allow us to “create markets, not products” or “turning product into markets” the idea is to create a “gold rush” on environmental problems. If we are capable of developing an oil spill cleaning technology or a plastic cleaning technology, AND we make it freely available, we hope to see many other companies exploiting our invention for environmental good.

And that’s where what many perceive as naivety becomes effective. Our license allows everyone to “use, modify, distribute” our technology for free at the condition to “credit the authors, and contribute the improvement to our community“. That means that any company improving our technology must share with us how they improved our technology. That means several good things :

  • our technology is improved
  • our community grows and everyone benefits from it
  • our brand grows (and we can control the naming/trademark and credits that go with it, see “Use of a traditional trademark, quality control authorship” paragraph.)
  • it is essentially free R&D for us, so the more people research, commercialise our technology, the more credit we get, confirming our position of experts in the field
  • we are constantly in contact with what other companies would call “concurrence“, that we can start to consider “collaboration” as they improve our technology.
  • the environment is the big winner if we are not (financially – if another manufacturers wins the preference of the consumer / community – that’s the risk we are willing to take)
  • We all make some money, support ourselves.

Many are skeptical of the potential commercial success of Open Hardware. If you consider the scale of issues such as the Pacific Ocean Garbage Patch as “demand” and what’s currently available as technological “offer” to solve that problem, you will soon see that our “Open Hardware for the Environment” technology has an enormous market potential. The environmental damage “demand” is a long way ahead of environmental remediation “offer”, and “Open Hardware for the Environment” is the intellectual property to bridge that gap, to scale a technology to that level. We could use that same logic for developing health solution as a clear subject of individual and general interest – yet, many people are dying to pharmaceutical lobbies financial interest, the same way we are destroying our environment to powerful energy, industrial, agricultural etc lobbies. I believe, this is changing too.

I personally think we are at pivot moment in human history, an enlightenment  : traditionally environmental issues where trusted to be best understood and addressed by non-profit (such as Greenpeace) academia and government. In recent years, many democratic countries have seen their large public enterprises privatised, public servants and politicians loosing credibility in corruption stories. Citizen do not trust anyone anymore and reclaim a democracy 2.0 that is real-time, transparent, accountable and to which they can democratically take part. As social inequalities grows and adequate natural resources shrink, the tension between governing and governed, rich and poor, responsible for climate change and victims of climate change increase, looking for a space of dialog. In a previous post, I explained how Open Hardware provides this neutral space for collaboration between Government and Citizen powered by Industries and Academia in the context of Brasil. I believe that this political pressure for affordable and transparent tools for transparent data will only amplify the growth of Open Hardware for the Environment as a market.

In 2010 Limor Fried and Philip Torrone presented “13 OPEN SOURCE HARDWARE COMPANIES MAKING $1 MILLION OR MORE (VIDEO)”

That really is to me the demonstration that Open Hardware companies can not only survive, but really thrive serving common good. And that was 2010 : today in 2012 there are hundreds of Open Hardware companies making money and that number is exponentially growing.

A Common Order of Ethical Priority

Even if a non-profit (Open-H2O) and a corporation (Protei INC) may have divergent objectives and modes of operation, they can share a similar order of ethical priorities.

Protei Ethical order of Priorities

Most corporations today have this order of priority :

  1. Profit (money)
  2. Technology (closed IP and monopoly)
  3. People
  4. Environment (Nature)

This order of priority makes perfect sense for an industry that exploits the environment, instrumentalises people, using technology for profit. In that logic, Profit is what drives technological innovation, people are usually just treated as a disposable “human resource” and the environment is a marketing consideration, part of the “greenwashing” strategy to increase the price tag of the service or product. It is funnier/absurd if you consider that this is the opposite of how the world really works : Without the environment no human would live, no technology would be created, money being one of the most arbitrary and abstract of all technologies.
If we want to create an industry that works for the environment, we must flip the “business as usual” order of priorities on it’s head :

  1. Environment (Nature)
  2. People
  3. Technology (open IP and collaboration)
  4. Profit (money)

And I am not talking about a revolution here, I am talking about sustainability for business. A system that supports itself, that re-enforces how the world really works: by prioritising the environmental growth, we provide people a healthy life, to develop meaningful technologies and make money. That is a virtuous circle, a desirable state of affairs that I think is the shift human society needs to make to become truly sustainable and meaningful in the eyes of other species on this planet.

A different order of development priority

The choice we are making above could seem uniformly applicable to both manufacturing and research. Yet, research and manufacturing are such different contexts, the same order of priority does not result the same decisions in daily operations. We are in the process of developing Protei_010. Protei_010 has one simple hull, will be distributed with a basic RC kit, but the “toy” would be upgradable to become a powerful modular ocean science platform. Environmentalists would stress the development of environmental sensors -which are the finality of our technology- when the majority of our market target would require us to focus on providing the basic functionalities of transport -which is the mean-.

  • One to develop the end (measure) : the Why. Research. Sensing activities. The end questions. Open-H2O.
  • One to develop the mean (transport) : the How. Manufacturing. The transport. The means to answer. Prote INC.


Again, that really justifies why we need both. An organisation that proves my argument to be wrong may be the Public Laboratory to which I used to contribute to regularly. Public Laboratory is a non-profit that also sells Citizen Science kits. But to my knowledge, the largest part of PLOTS” revenue come from non-profit grants. Several successful Kickstarter campaigns show that this could change as they are truly developing a community by using crowd-funding platform to pre-sell their Open Hardware for the Environment kits. I personally want to situate the development of an environmental technology in the reckless but powerful reality of market and concurrence for Protei.

A technology that was invented a century ago, that started coming out of  labs 25 years ago, became a toy with countless manufacturers for 2 decades reducing price, improving spectacularly specs are quadrocopters (or Quadrotor). Now the performance of quadrocopters are so high in comparison of their price, they are back to the lab to be tested in large numbers, serving now not the purpose of transport but as physical platform for  the most advanced swarm robotics and coordinated robotics experiments. Now imagine the same agility on the water, a fleet, a swarm of Protei… :) That’s when industry can really serve the research. Instead of spending decades developing Protei technology, we can develop it’s research and industrial applications simultaneously.


Why Shareholders cannot manage Protei INC, but why Open-H2O community must govern itself meritocratically

A normal C-corp would have the company owned by it’s shareholders. Typically shareholders invest money in the company because they are interested in maximising the company’s profit and their individual dividends. That is also called speculation, and because we want to subvert standard capitalist corporation functionning -namely a C-corp- we refuse to give away to our respected shareholders the capacity to maximise their dividends at the detriment of our ethical engagement that is to prioritise Environmental benefit, over people, over the technology. We want to see our environmental return grow faster than our financial return, that’s our success criteria.

In practical terms, that means that shares distributed by the company would not allow the shareholders to :

  • decide who the CEO is
  • manage the company and key decisions
  • decide how much dividend to allocate themselves.

These are the main “Exotic” conditions attached to the shares of Protei INC that guarantee the durability of our corporation for the betterment of the Environment. We can control the ethical engagement of a small number on the board of Directors ; we cannot control the financial behaviour of whoever decides to invest in the company, especially when that number grows, and when the volume of “external investors” outnumbers in volume the shares of the core team.

On the other hand, Open-H2O wants to be a meritocracy, that is democratically electing it’s representatives for a competitively renewed leadership for quality in research. Knowledge is produced mainly by 2 forces : collaboration and competition. In practice these 2 processes are not opposed but variants of one another as they are comparative processes, with a common goal : excellence.

I drafted below how such a system could work.

Incentivised Meritocracy for excellence in research. Open-H2O

That is for research, now many other tasks such as web development, administrative, field work and more could be allocated budget using this system that is meritocratic.

Open Hardware H2O License

open hardware documentation

A robust license acts as an”intellectual currency” to exchange “intellectual property” between Protei INC and Open-H2O. It is the license that both connects and differentiate Protei INC and Open-H2O, since Open_H2O will be developing a Technology in the non-profit world, while Protei INC would be manufacturing a Product in the commercial world.

The Open Hardware H2O is intended to invite anyone to use, modify or distribute Protei technology for free in exchange of crediting the authors and contributing to the Open_H2O community. Protei would be the first technology licensed under Open Hardware H2O but any technology that fulfils the mission of Open-H2O of “developing Open Technologies to explore and protect the oceans” would be eligible to that license and the support of the Open-H2O community.

This license should provide all the legal basics that an inventor that has a technology that he/she wants to  develop and licence as open hardware for the environment would want to see covered. So there is the IP specified above but also have a liability disclaimer in case of accident or misuse, environmental considerations and adaptations to specific rules that apply to the aquatic environment, especially in international waters. This license is currently under development and I will update this article when the first version of our license Open Hardware H2O license is released.

Use of a traditional trademark, quality control authorship

This may sound slightly strange but as much as we want to give away a lot of the control of who does what with the Protei technology, being able to modify and commercialise it, I reserve myself the right to decide what is “Protei” and what is not. As the original inventor of the technology, I recognise the contribution of the Open-H2O community to have contributed to the development of Protei. I invented the technology and the name, and I remain the owner of the trademark “Protei”, registered at the US Trademark office. I did not do this because I am a control freak, I do this for the integrity of the community and quality control of the work produced. Granting the name “Protei” to a prototype or product is a like a seal of approval, a quality label. I did not invent this, I learned it from Arduino.

arduino trademark

To my point of view Arduino is the most powerful Open Hardware platform project to date, now available in every Radioshack and taught in art, design, robotics and science classes around the world.


Now the downside of having 2 structures :

  • Confusion if you start like us, from one group that turns into 2, some people might feel they want to belong to both, but that may not be possible. It also means a clear redistribution of responsibilities  labor and titles must occur.
  • Administrative work : yes, it is twice the amount of paperwork at the beginning.
  • Legal work : the same lawyer for both entities or two separate ones? Really depends on your lawyer experience and your budget.
  • Structural cost : yes, it costs more to register and run, but to my point of view a lot cleaner.
  • Public and Private information : That theme overlaps a bit with conflicts of interest, as one may want to have both the up on research and manufacturing (ref. Public and Private information : a question of timing )
  • Community and employee overlap : potential conflicts of interest. And the political tension might grow if one or the other entity makes more money, but that’s human, and that’s called jealousy or greed.

Personal motivations

Beyond general strategic motivations, I also have personal motivations to be wanting to focus on Protei INC and less on Open-H2O for some time.
I used to spend 90% of my time prototyping and testing in the water, 10% to document. Since the project has become a collective effort, I spend 90% of my time managing the team and doing admin work, and 10% prototyping and testing in the water. The best sailing prototype today is still Protei_002 that I built alone for 150 USD alone in garage in New Orleans in 2010. I must get back to the workshop and to the water to make the technology and the community progress.

There is a lot of work ahead of us, but this is an incredibly exciting time. I hope you now understand better the mutations we are experiencing and it encourages you to build similar / better ventures! I have special thoughts here for our friends at OpenROV, Littlebits, OpenMaterials, windowfarms, safecast, PublicLab, OpenRelief  that are great sources of inspiration for us and that are totally taking off  as Open Hardware businesses : keep going guys! We’re coming too! Open Hardware for the Environment !

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{ 7 comments to read ... please submit one more! }

  1. Important statement. Adapt, evolve, move. But do not stop.

  2. Andrea Grover

    It seems you have offered an answer to Steven Shapin’s question about the shape-shifting identity of the modern scientist:

  3. I must admit that having to divide our activities into 2 entities somehow felt like a necessary challenge : I had hope for sometime that research and industry concerns were conciliable into one entity, but found that was too hard in our competitive market. I am happy with this new direction we are taking, and we will keep changing as our “identity in society is a work in progress”. Thanks for the ref.

  4. Thanks César for this long and great posting. It’s clear and helps a lot to understand both your choice and the evolution of Protei !

  5. Yasir Siddiqui

    There are positives and negatives about the strategic choice. I am happy that the community and the value created by the community will not be entirely closed off with the dual approach. In this post, however, I would like to focus on the dangers of this approach.

    The split between for-profit and non-profit entity highlights the fundamental failure in the way we capture and exchange value in our current system; that is, value created for the good of the community is generally not captured. In essence, the choice in itself amplifies the limitations of the system. Thus, there is a need for a new system whereby, the distinction between the good of the society and for-profit does not exist.

    Reverting the post to the dangers of the approach:

    1) Control through dependency – non-for-profit entity relies on the for-profit entity for the value capture, distribution and exchange mechanism. Overtime, this would replicate the power and hierarchal structures.

    2) Rules of redistribution – Value is captured in the for-profit, hence, the rules of redistribution of this value are decided in the for-profit.

    3) Unfair negotiations – It is true that the model creates a dependency between for-profit and non-for-profit entities; yet, the power of negotiation is one-sided, whereby, entity that captures values provides the scarced function and hence, obtains a higher negotiation power and value.

    How do we resolve these issues?

    We have created new mechanisms of value creation. Next, we need new mechanisms of value capture, distribution and exchange.

    I would invite people to explore openvalue networks that provide mechanisms for value creation, capture, distribution and exchange.

    We are applying the open-value network at Sensorica to produce open-source sensors.

    Good luck,

    P.S. If you would like, I would be happy to discuss further. Feel free to drop me an email at:

  6. cesarharada

    Thanks for focusing on the danger of the system and as you mention yourself your comment may be one sided. Money and knowledge are both powerful levers for negociation, you make it sound that money may be a more powerful one leading to hierarchical and unfair outcome, I believe knowledge is a more powerful lever that can also lead to unfair and hierarchical structure. So it’s not about the strategy and mechanism but about people, not about the system but what people do with it. Neither a money or knowledge driven system are limitating (what are the limits of capitalism? Wikipedia? ) and both for-profit and not-for-profit have reasons to exist in society for many reasons. Can you please point me at articles I should read about alternative money / knowledge, profit/ not-for-profit structure? Thanks for your comm

  7. Yasir Siddiqui

    We had some discussions a while on this subject matter. Here is an article (still under construction) that I have co-authored that might be of interest to you.


    Full article:

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