Kickstarter Restructures As Public Benefit Corporation

Kickstarter has restructured as Kickstarter PBC, a public benefit corporation. In a statement on the company’s website, Founder/Chairman Perry Chen, Co-founder Charles Adler, and CEO/Co-founder Yancey Strickler offered an explanation of the new business model.

“Until recently, the idea of a for-profit company pursuing social good at the expense of shareholder value had no clear protection under U.S. corporate law, and certainly no mandate. 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.”

Among the company’s values and commitments listed in its charter are:

• An agreement to not lobby or campaign for public policies unless they align with the company’s mission and values, regardless of possible economic benefits to the company.
• A commitment to not use loopholes or other esoteric but legal tax management strategies to reduce the company’s tax burden. Kickstarter will be transparent in reporting the percentage of taxes it pays and explaining the factors that affect its tax calculation.
• Kickstarter will seek to limit environmental impact. It will invest in green infrastructure, support green commuting methods, and factor environmental impact when choosing vendors. Additionally, Kickstarter will provide recommendations and resources that help creators make environmentally conscious decisions on tasks, like shipping and packaging, that are common to the use of its services.
• Kickstarter will annually donate 5 percent of its after-tax profit towards arts and music education, and to organizations fighting to end systemic inequality. Half of the 5 percent will be devoted to music and arts programs, with a primary focus on underserved communities in New York City. The other half will be devoted to organizations addressing systemic inequality. Kickstarter will primarily focus such contributions on 501(c)(3) organizations fighting to end prejudices against and increase opportunities for people of color, women, and LGBTQ individuals.
• Kickstarter will provide opportunities and paid time off for employees to provide professional mentorship and skills training to people from groups underrepresented in the worlds of art, business, or technology.
• Kickstarter will report on team and leadership demographics, executive and CEO pay ratios, and programs and strategies employed to build a diverse, inclusive, and equitable organization.

The first of these benefits will be shared beginning in February 2017.

“From Kickstarter’s inception, we’ve focused on serving artists, creators, and audiences to help bring creative projects to life. Our new status as a Benefit Corporation hard-codes that mission at the deepest level possible to guide us, and future leaders of Kickstarter,” the statement summed.