Kickstarter - Now a Benefit Corporation

suibhne said:

You're kidding, right? The reason everybody and their uncle incorporate in Delaware is that the state has famously weak S-corp/C-corp obligations. Corporations are governed by the statutes in the state where they're incorporated.



100% of $0 in revenue, yes. I suppose your claim is that Kickstarter does more social damage by simply existing than it could ever address via its 5% pledge, but you don't support that in any way.

In other news, Bedwyr is on target here. The biggest benefit of a B-corp (and one not explicitly addressed in this piece) is that "shareholder value" can now be considered among other goals, including social good, rather than it receiving the legal privilege of overriding all other goals. KS had a bunch of angels and even some VC money, so I'm a little impressed that they were all on board with this change.

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How would you/they define "social good"?

Saxon1974 said:

How would you/they define "social good"?

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I'm not sure why my opinion would matter here. That's not at issue; I don't represent Kickstarter.

You can find out more here (or directly from B Labs):
https://en.wikipedia.org/wiki/Benefit_corporation

Altho B-corps have tended to heavily represent environmentally-minded businesses, that's partly because traditional corporate valuation does an extremely poor job of accounting for externalities. There's no reason a B-corp couldn't support gun ownership rights, e.g.

Saxon1974 said:

Its another wing of the same mentality. Income inequality, evil rich! Raise minimum wage! We should all earn the same! Its the thinking of the left wing socialist groups currently destroying the western world with BS terms like income inequality, white privilege, social justice etc….

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Drink some more wine to cool down.

suibhne said:

You're kidding, right? The reason everybody and their uncle incorporate in Delaware is that the state has famously weak S-corp/C-corp obligations. Corporations are governed by the statutes in the state where they're incorporated.

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No kidding.

KS commit themselves not to do what others do for KS.

As long the Delaware state provides the advantages KS want, why should KS try to get the advantages by themselves?

It is nothing different from a don committing himself not to murder people while his hit men take charge of the murders.

Some must get their hands dirty so that others can keep theirs clean.

100% of $0 in revenue, yes. I suppose your claim is that Kickstarter does more social damage by simply existing than it could ever address via its 5% pledge, but you don't support that in any way.

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The term "social damage" was not used and is dismissed.

100% of $0 in revenue, yes.

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100% of the resources KS squander. The non existence of KS and the associated projects would leave the resources KS squander untouched.

I suppose your claim is that Kickstarter does more social damage by simply existing than it could ever address via its 5% pledge, but you don't support that in any way.

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The observations are not reported that way.

KS announce they are going to redistribute 5% of their revenues and allocate a large part to fight systemic inequality.

It happens that KS generate themselves systemic inequality.

KS projects underdeliver.

People are largely more likely to be equal in their capacity to underdeliver than they are in their capacity to deliver.

The successfully funded projects do not represent the large pool of people that are able to underdeliver.

The inequality is generated by KS.

KS generates systemic inequality yet claims to commit to fight systemic inequality.

Their position is no different from drug dealers who takes a fraction of their revenues to fund rehab clinics.
Their objective would be better served by stopping to sell drugs.

Just as others, KS has just set a front to cover the nature of their main operations.

Bedwyr said:

Dude. Really. That is an utterly bullshit thing to say and you know it. If you can't be fussed to communicate coherently with people, you have nothing to say except mutter to yourself like Foul Ol Ron from Discworld. Instead of a cop-out, why not try and reframe your thesis so people can actually read and understand it?

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What is known is that there is no freedom of speech on this site and that behaving as there was would come with consequences.

Otherwise you're useless to the conversation.

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The comments are useless. The other comments, by the way, are useless.
The difference is that some might recognize their comments for what they are, useless while others prefer to pretend some kind of usefulness to their comments.

And I'll add that I *want* you to add to the conversation. You've got something to contribute, but you've got to try harder when formulating your thoughts.

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There is no conversation to contribute to.

There is only acknowledging a situation.

KS are quite transparent about their ways. They are for example a company located in Delaware committing themselves not to look for tax loop holes, even when they are legal.

Ask for help if you're having trouble. Don't just throw your hand up in the air and get all snooty.

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What kind of help?
KS behaves in such way they reveal people 's eagerness to take at face value KS words.

Some people might be interested in getting to get that kind of eagerness. Others might not.

Saxon1974 said:

Its another wing of the same mentality. Income inequality, evil rich! Raise minimum wage! We should all earn the same! Its the thinking of the left wing socialist groups currently destroying the western world with BS terms like income inequality, white privilege, social justice etc….

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Mmm, whatever. They want to contribute some of their income to causes that will help out those less fortunate. It's not a bad thing.

rjshae said:

Mmm, whatever. They want to contribute some of their income to causes that will help out those less fortunate. It's not a bad thing.

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So they will take some of the money from the creator/backers and give it to someone else. Do creators/backers doing the funding get a say in where this money goes? Nope they don't. I'm all for charity and I give to some but taking from one group to give to another isn't charity that's wealth redistribution.

Saxon1974 said:

So they will take some of the money from the creator/backers and give it to someone else. Do creators/backers doing the funding get a say in where this money goes? Nope they don't. I'm all for charity and I give to some but taking from one group to give to another isn't charity that's wealth redistribution.

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In this case they will be giving it from their profits.

But there is nothing wrong with wealth distribution if done fairly. It works well for many countries in Europe and they get by better than USA without starting wars all over the world.

Saxon1974 said:

So they will take some of the money from the creator/backers and give it to someone else. Do creators/backers doing the funding get a say in where this money goes? Nope they don't. I'm all for charity and I give to some but taking from one group to give to another isn't charity that's wealth redistribution.

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I don't think you know how Kickstarter works. The money isn't being taken from creators or backers - it's being taken out of Kickstarter's own margin. If you don't believe Kickstarter earns the margin it charges, you are 100% capable of taking your projects, or your backing, to another platform like Indiegogo or Fig. But the value provided by Kickstarter - and the margin it takes for that value it provides - has absolutely nothing to do with how the company chooses to spend that value, any more than your own salary should be reduced because you say you feel able to give some of it to charity.

Archangel said:

In this case they will be giving it from their profits.

But there is nothing wrong with wealth distribution if done fairly. It works well for many countries in Europe and they get by better than USA without starting wars all over the world.

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Couldn't disagree more, Europe's economy has been stagnant for a very long time with Germany subsiding many other countries. I think the European Union will very likely implode.

Nice of you taking a shot as the USA with a comment that was irrelavent to the discussion. So then I guess if the USA didn't exist the world would be 100 peace and love right? Which country responds the most with foreign add and humanitarian relief when needed? I think you can guess it.

Guess we agree to disagree

suibhne said:

I don't think you know how Kickstarter works. The money isn't being taken from creators or backers - it's being taken out of Kickstarter's own margin. If you don't believe Kickstarter earns the margin it charges, you are 100% capable of taking your projects, or your backing, to another platform like Indiegogo or Fig. But the value provided by Kickstarter - and the margin it takes for that value it provides - has absolutely nothing to do with how the company chooses to spend that value, any more than your own salary should be reduced because you say you feel able to give some of it to charity.

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Fair point, but they only make money by taking a cut of the profits, which they deserve some of but i suspect they will raise their cut to cover this. This is purely my own speculation though. I know what usually follows when terms like systemic inequalities are mentioned.

Only a dumbass would think that they are now dedicated to "doing good" when they go incorporate themselves in Delaware.

Saxon1974 said:

Europe's economy has been stagnant for a very long time with Germany subsiding many other countries.

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Wait... Germany's been subsiding other countries? Those pesky Germans...

I would rather have seen them lower their cut on projects, specially the smaller ones.
Still even if it's just a pr stunt there will be money going to something that hopefully is not all waste.

six said:

I would rather have seen them lower their cut on projects, specially the smaller ones.
Still even if it's just a pr stunt there will be money going to something that hopefully is not all waste.

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Yep, instead of giving away 5% of their profits they should just reduce their cut by the equivalent amount so more money goes to the project creators. After all, that's why people are putting the money into Kickstarters - to give it to the project creators. Not to put it into whatever random charity the people at Kickstarter decide they like.

So this is a way to have the benefits of being a non-profit but actually make a profit is what it looks like to me - i.e. having your cake and eating it too. I'm betting the University of Phoenix and ITT tech would love to have that.

Saxon1974 said:

Couldn't disagree more, Europe's economy has been stagnant for a very long time with Germany subsiding many other countries. I think the European Union will very likely implode.

Nice of you taking a shot as the USA with a comment that was irrelavent to the discussion. So then I guess if the USA didn't exist the world would be 100 peace and love right? Which country responds the most with foreign add and humanitarian relief when needed? I think you can guess it.

Guess we agree to disagree

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You need to learn to read. I said some EU countries, not EU as a whole.

As for taking pot shots, it is not hard when the target is the size of its aircraft carriers that "bring democracy to all parts of the world". I been playing Act of Aggression lately and the comment of Abrams crew in that game sums it up perfectly: "120mm of pure democracy!"

Stingray said:

Yep, instead of giving away 5% of their profits they should just reduce their cut by the equivalent amount so more money goes to the project creators. After all, that's why people are putting the money into Kickstarters - to give it to the project creators. Not to put it into whatever random charity the people at Kickstarter decide they like.

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Again, this is all about how Kickstarter chooses to spend its own margin. If you believe it earns too much margin, that's fine - you can mount that argument. But if you don't mount that argument, it's pretty silly to complain about how Kickstarter spends its own margin. At that point, since KS is a private company, you might as well go into how individual KS owners spend their own earnings from KS.

KS directing a percentage of margin to "charity" etc. doesn't take anything from creators/backers. If KS weren't doing that, the margin would be going to Retained Earnings or back to shareholders - never to creators/backers. There are really only two crowds who have cause for complaint here: KS's owners (i.e., shareholders, who might argue either that the company isn't returning enough earnings to them or isn't adequately re-investing in the company; the B-corp structure helps address this concern as an overriding legal obligation), and users with moral objections to how Kickstarter directs its earnings (but again, such users should also focus on how Kickstarter's owners spend their own earnings from their shares in KS).

Lucky Day said:

So this is a way to have the benefits of being a non-profit but actually make a profit is what it looks like to me - i.e. having your cake and eating it too. I'm betting the University of Phoenix and ITT tech would love to have that.

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No, that's not correct at all. B-corps still have Retained Earnings and they still return profits to shareholders. Maximizing shareholder value is still one of the objectives they're required to aim for; it's simply not the only one. Your point is particularly wrong, in fact, because tax-exemption is by far the largest benefit of being a nonprofit, and B-corp status doesn't carry any tax advantages vs. other for-profit corp structures (S-corp, C-corp, etc.).

suibhne said:

Again, this is all about how Kickstarter chooses to spend its own margin. If you believe it earns too much margin, that's fine - you can mount that argument. But if you don't mount that argument, it's pretty silly to complain about how Kickstarter spends its own margin. At that point, since KS is a private company, you might as well go into how individual KS owners spend their own earnings from KS.

KS directing a percentage of margin to "charity" etc. doesn't take anything from creators/backers. If KS weren't doing that, the margin would be going to Retained Earnings or back to shareholders - never to creators/backers. There are really only two crowds who have cause for complaint here: KS's owners (i.e., shareholders, who might argue either that the company isn't returning enough earnings to them or isn't adequately re-investing in the company; the B-corp structure helps address this concern as an overriding legal obligation), and users with moral objections to how Kickstarter directs its earnings (but again, such users should also focus on how Kickstarter's owners spend their own earnings from their shares in KS).

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All that info was unnecessary, because really the bottom line is this… Kickstarter is giving away 5% of its profits to charity and essentially bragging about it. The reality is that Kickstarter users would be better off if the 5% went to the guys they're actually backing, ie: the whole reason they visited the site. So it seems like a dumb thing to brag about.

Nobody questioned that they can charge whatever cut they want and are free to spend their money however they like. That said, their website is pretty basic and bad and the only reason anyone goes there is because the name is well-known. (Which is why stuff like fig.co is coming into being, I guess)

What is the point here? Are there people with opposed views?

Kickstarter will allocate parts of the revenues to fight systemic inequality.

Kickstarter are a platform for systemic inequality.

People who live off systemic inequality have nothing to fear: Kickstarter favours more systemic inequality than they can compensate. It is quite useless to bring on the table fuzzy concepts like social justice, that do not even resist the most shallow analysis.

Kickstarter are a platform for systemic inequality that cant compensate. The termination of the company would serve far better the claimed objective of fighting systemic inequality.
They do not do that.
Instead, they take resources to stage themselves fighting systemic inequality.

People who live off staging a fight against systemic inequality have nothing to fear: Kickstarter will drop bucks to organize the shows.

Everybody is happy: people living off systemic inequality and people living off staging the fight against systemic inequality.

No point of discord.

How is KS a platform for systemic inequality?
They let anyone use it with not many rules and certainly not those that promote system inequality. If you succeed or not is your problem then, not KSs.