Kickstarter, the crowdfunding site, has announced that it has reincorporated as a public benefit corporation, a relatively new kind of company, according to a company blog post. The goals of such a company must be to do something to aid the public.
The company, which is now Kickstarter PBC and no longer Kickstarter Inc., outlined its rationale:
Companies that believe there are more important goals than maximizing shareholder value have been at odds with the expectation that for-profit companies must exist ultimately for profit above all.
Benefit Corporations are different. Benefit Corporations are for-profit companies that are obligated to consider the impact of their decisions on society, not only shareholders. Radically, positive impact on society becomes part of a Benefit Corporation s legally defined goals.
Kickstarter said it would newly commit to donate 5 percent of annual post-tax profits to arts education and organizations fighting inequality. And every year, it will release an assessment on how it is meeting its commitments.
Yancey Strickler, the company s chief executive, told the New York Times:
We don t ever want to sell or go public. That would push the company to make choices that we don t think are in the best interest of the company.
Other benefit corporations include Patagonia and Etsy, which went public this year, as the Times noted.
The decision is being touted as an antithesis to the current tech climate of raising as much money as possible with the goal of going public or becoming acquired. Private companies valued more than $1 billion have been dubbed unicorns.
Kickstarter s decision to become a public benefit corporation builds on its decision last year to become a B corporation. An outside nonprofit, B Labs, certifies that a B company meets environmental and social goals. But becoming a B corporation is voluntary, the firm s leaders told the Times. Becoming a public benefit company restructured the legal foundation of the company, they said.
The company said it hopes its move is part of a growing movement of firms seeking to be about more than profits:
While only about .01% of all American businesses have done this, we believe that can and will change in the coming years. More and more voices are rejecting business as usual, and the pursuit of profit above all.
Photo: Kickstarter says it wants to be more than just another unicorn. (Bob Andres/Atlanta Journal-Constitution, MCT Archives)
