This week, Kickstarter announced that it would be changing course fairly significantly. The crowd funding platform was founded around six and a half years ago as a corporate entity but it is now set to transition from being a traditional corporation in to what is called a ‘public benefit corporation’ (PBC).
A PBC is a new kind of corporate entity, which is recognized in 27 different states in the US, these entities have a legal responsibility to perform a social good or to benefit society in some way. The idea behind the change to a PBC is to shield Kickstarter from the influence of investors and shareholders, though the company could still go public and can still be for-profit.
Kickstarter summed the whole thing up quite well on a post to its site: “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”.
“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.”
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KitGuru Says: Kickstarter wants to renew its commitment to creative projects with this move. It will also be interesting to see if this ends up having an impact on projects that get funded but don’t come to fruition. Aside from that though, this move only really affects Kickstarter’s legal obligations and won’t directly change how campaigns already operate.