Kickstarter Inc Is No More. Crowdfunding Giant Is Now “Benefit Corporation”
Picture your traditional, everyday large corporation in America. What does it do? It may produce t-shirts, or beverages or sell gimmicky group coupons—but none of that actually matters. What it actually does is make money. Like one of those robot-battling shows from the early 2000’s, their creator built them with the purpose of competing and destroying the competition through any legal (or semi-legal) means available. Looking at it that way, the products the company make become irrelevant—a bi-product, if you will—to the dollar-gripping purpose of the business.
I’m not going to say there’s something wrong with that (at least not in this article), but I will ask that you now envision a different type of company. Imagine a corporation that, instead of working like a money-scooping automaton, had a legally-binding corporate mission to put positive social impact ahead of maximum shareholder profits some of the time. Picture a company that, when presented with a situation where a nominal amount of money is at stake against the societal or global good, doesn’t blurt out “MONEY!” before you even finish asking the question. Is this from a page in some far-out utopia novel featuring flying cars and mixed-gender restrooms? No, this is a new feature of United States corporate law that the company formerly named Kickstarter Inc has officially adopted as its own business model.
So what are they called now? Kickstarter PBC—public benefit corporation. It’s a relatively new type of corporate entity in the US that began in 2010 with the passing of legislature in the state of Maryland. Today, 28 states have laws on the books defining the PBC as a legal corporate structure. So what are they? A benefit corporation is a for-profit company of any size that includes positive impact on society and the environment in addition to profit as its legally-defined goals. But this isn’t just some fingers-crossed, crowd-pleasing pseudo-pledge that a company can toss out to increase their public image temporarily and then bail on without even trying. The standards set forth by the company are often measured by a third party entity, and the company must put out an annual benefit report to the public detailing the success they had with their stated benefit goals that year.
Why is this right for Kickstarter?
According to their official PBC charter, “Kickstarter’s mission is to help bring creative projects to life. We measure our success as a company by how well we achieve that mission, not by the size of our profits.” A mentality like that makes them the perfect candidate for reincorporating as a benefit corporation. In their announcement they claim that there was not a single dissenting shareholder when it came time to vote on the decision to become a PBC. And while those enamored with the idea of a pure (read: brutal; uncaring) capitalistic society would no doubt decry benefit corp law as an unnecessary and loosely-defined gimmick, I would say that this “gimmick” is another great tool toward the continued nurturing of global empathy and the human race’s journey toward giving a flying fukk about each other and our world.
Kickstarter’s pledged goals as a PBC
As a part of their transition to benefit corp, KS has released a charter detailing their intended goals and purpose going forward. These predictably include tenants about supporting creatives and creativity itself, including engaging “beyond its walls with the greater issues and conversations affecting artists and creators”. Also included are promises about protecting user privacy, not seeking tax loopholes, not lobbying for policies besides those that match its values, transparency in reporting taxes to the public, and limiting environmental impact. They will also donate 5% of their profits to arts and music education, and to organizations fighting systematic inequality.
Personally I think the shift captures the heart and culture of the crowdfunding movement much better than a regular for-profit, or even a traditional non-profit. Both Kickstarter and its creators rely on each other to make money, and no one needs to be ashamed about that. But when a group of people can stand up and say that they want to do good and be held accountable to it, it turns the company into more of what it actually is—a conglomerate of human minds, including the human conscience—instead of some unstoppable wind-up toy that was set in motion with the most narrow field of view possible.
Kickstarter Inc Is No More. Crowdfunding Giant Is Now "Benefit Corporation" | IndieRuckus!
