There's probably an order of magnitude of people who don't edit Wikipedia because they're unhappy with Wikipedia's policies or its culture. I think the right Wikipedia alternative is probably viable and could maybe even be bigger and more successful than Wikipedia but alternatives generally fail because they can't get the critical mass of active editors necessary to keep the site updated especially on quickly changing topics where Wikipedia's approach is good enough for most people who'd be interested in editing on those topics. Forks (Infogalatic, Everipedia) typically become filled with outdated Wikipedia articles plus a few new articles about the creator's personal hobby horses. Just like features in open source software, articles in an open source online have to be maintained.

The most successful alternative to Wikipedia is probably Conservapedia which is largely edited, I believe, by American right wing political activists and evangelical Christian homeschooled teens. Their articles reflect the changes in American right wing politics over the past 20 years or so meaning some are out of date with the current party line because they haven't been touched in years. That's one model of competing with Wikipedia but an encyclopedia consisting of outright partisan political propaganda and outright religious propaganda isn't useful to most people even most people who agree with its viewpoint[0]. Counterintuitively, I think Conservapedia has probably been successful because it rewrote everything from scratch. That also ensures you won't get dinged by Google under the duplicate content policy and basically delisted from search.

I don't think federation is the right way to make a Wikipedia alternative viable because it is already an open source project run on open source software that anybody can fork. It's solving the wrong problem. The right problem to solve is getting a critical mass of editors who aren't just editing to push an agenda. That probably requires paid professional editors whose job is to maintain the encyclopedia. You can probably hire sufficiently smart people for $15 or so an hour because there are probably many smart people already working for that rate at McJobs[1]. That also makes your alternative appealing to current Wikipedia editors who are generally paid $0 to edit Wikipedia. If you're looking to hire expert editors, you'd probably have to pay more but you probably don't need experts. The downside of this is you have to have money to pay editors and probably to advertise that you're paying editors to create a competitor to Wikipedia. That also ensures you have enough editors to maintain the articles. I think Wikipedia alternative with paid editors would probably work as a relatively low risk but also low reward startup idea assuming there was sufficient funding behind it.

[0]: Wikipedia does have its own biases and "neutral point of view" is now basically equated with "objectivity" but it is far less in your face about its biases than Conservapedia which reads more like the timeline of a Twitter account that follows all of the big right wing influencers to Wikipedia's Google News.

[1]: Specifically, high school and college students. Also, many smart people who didn't go to college for whatever reason. They'd probably prefer writing over flipping burgers or running a checkout line.