Kickstarter — Case Study of a Public Benefit Corporation

02/06/20 • 18 min

Startup LAWnchpad is the podcast that educates entrepreneurs about forming, growing, and protecting a startup. Startup LAWnchpad is produced by the Entrepreneurial Law Clinic at Fordham University School of Law in New York City.

Episode Description: Adam Mengler (Fordham Law ‘19) interviews Chris Mitchell (Fordham Law ‘00), General Counsel of Kickstarter—a Public Benefit Corporation and Certified B Corporation—to discuss the benefits and challenges that come with forming a benefit corporation.

Episode Roadmap:

[:30] Adam Mengler introduces himself and Chris Mitchell, General Counsel of Kickstarter.
[2:30] Chris Mitchell explains what a benefit corporation is and the associated legal obligations.
[4:17] The benefits of transitioning to a benefit corporation.
[5:41] Balancing charter goals with a company’s financial interests.
[9:52] Challenges that benefit corporations face when raising money.
[10:40] Considerations for companies before becoming a benefit corporation.
[13:34] The effects of being a benefit corporation on the company’s attorneys.
[14:47] Nurturing an entrepreneurial spirit and Chris Mitchell’s favorite books.

Tweetables:

“The PBC form formalizes several long-standing Kickstarter beliefs and priorities.” — Chris Mitchell
“I’m always referencing back to the charter; making sure that all of our commitments are being fulfilled, not just the profit maximization ones.” — Chris Mitchell
“[Becoming a PBC] is not quite as daunting as people may realize, and I think it’s incredibly beneficial.” — Chris Mitchell

Mentioned in This Episode:

Additional Resources:

Fordham’s Entrepreneurial Law Clinic
Follow us on Twitter @FordhamELC

Sponsors:

Disclaimer:

The information contained in the Startup LAWnchpad podcast and any materials associated therewith (the “Podcast”) is for educational, informational, and entertainment purposes only. It does not constitute legal advice or tax advice with respect to any particular circumstance. The Podcast is not a complete overview or analysis of the topics presented, and may contain information that varies in different jurisdictions and is subject to revision, interpretation, or nullification after the date of recording. The transmission of information to you does not create a lawyer-client relationship between you and any host, guest, or their respective employer, including but not limited to Fordham University School of Law and Lincoln Square Legal Services, Inc. None of these parties shall be liable for any loss that may arise from any reliance on the Podcast. You should not rely upon the Podcast or treat it as a substitute for legal advice. You should consult a lawyer familiar with your particular circumstances and licensed in your jurisdiction for legal advice.

Episode Roadmap:

[:30] Adam Mengler introduces himself and Chris Mitchell, General Counsel of Kickstarter.
[2:30] Chris Mitchell explains what a benefit corporation is and the associated legal obligations.
[4:17] The benefits of transitioning to a benefit corporation.
[5:41] Balancing charter goals with a company’s financial interests.
[9:52] Challenges that benefit corporations face when raising money.
[10:40] Considerations for companies before becoming a benefit corporation.
[13:34] The effects of being a benefit corporation on the company’s attorneys.
[14:47] Nurturing an entrepreneurial spirit and Chris Mitchell’s favorite books.

Tweetables:

“The PBC form formalizes several long-standing Kickstarter beliefs and priorities.” — Chris Mitchell
“I’m always referencing back to the charter; making sure that all of our commitments are being fulfilled, not just the profit maximization ones.” — Chris Mitchell
“[Becoming a PBC] is not quite as daunting as people may realize, and I think it’s incredibly beneficial.” — Chris Mitchell

Mentioned in This Episode:

Additional Resources:

Fordham’s Entrepreneurial Law Clinic
Follow us on Twitter @FordhamELC

Sponsors:

Disclaimer:

Previous Episode

Access to Capital for Female and Minority Entrepreneurs — Case Study of Mi Dinero Mi Futuro

Startup LAWnchpad is the podcast that educates entrepreneurs about forming, growing, and protecting a startup. Startup LAWnchpad is produced by the Entrepreneurial Law Clinic at Fordham University School of Law in New York City.

Episode Description: Oluwayemisi (“Yemi”) Danmola (Fordham Law ‘19) and Diana Ryzhova (Fordham Law ‘19) interview Ramona Ortega (Fordham Law ‘13), Founder and CEO of Mi Dinero Mi Futuro (My Money My Future Inc.), a fintech company for multicultural millennials, to discuss access to capital for female and minority entrepreneurs.

Episode Roadmap:

[:15] Bernice Grant introduces Season 2 of Startup LAWnchpad.
[2:06] Diana Ryzhova and Yemi Danmola introduce themselves and the topic of access to capital for female and minority entrepreneurs.
[4:10] Ramona Ortega introduces herself and her current business venture.
[10:43] The steps required on the long road to starting up a new company.
[17:50] ‘Financial literacy’ — its perception and problems, and what Ramona’s company focuses on instead.
[20:20] Resources to help entrepreneurs understand financial law.
[24:16] The current access to capital environment for females and minorities.
[35:35] Ramona’s reflections on participation in female-led venture capital endeavours.
[42:43] Is this the career that Ramona dreamed of in her childhood?

Tweetables:

“Any entrepreneur should be asking themselves — what is the problem that you’re solving, and why are you the person to solve it?” — Ramona Ortega
“We empower people to make smarter financial decisions by giving them the information and the tools they need.” — Ramona Ortega
“This is not about us telling people what to do; it’s about empowering people to understand how money works.” — Ramona Ortega
“Humility, being able to start over, taking great risks — that’s what great entrepreneurs do.” — Ramona Ortega

Mentioned in This Episode:

Additional Resources:

Fordham’s Entrepreneurial Law Clinic
Follow us on Twitter @FordhamELC

Sponsors:

Disclaimer:

The information contained in the Startup LAWnchpad podcast and any materials associated therewith (the “Podcast”), is for educational, informational, and entertainment purposes only. It does not constitute legal advice or tax advice with respect to any particular circumstance. The Podcast is not a complete overview or analysis of the topics presented, and may contain information that varies in different jurisdictions and is subject to revision, interpretation, or nullification after the date of recording. The transmission of information to you does not create a lawyer-client relationship between you and any host, guest, or their respective employer, including but not limited to Fordham University School of Law and Lincoln Square Legal Services, Inc. None of these parties shall be liable for any loss that may arise from any reliance on the Podcast. You should not rely upon the Podcast or treat it as a substitute for legal advice. You should consult a lawyer familiar with your particular circumstances and licensed in your jurisdiction for legal advice.

Next Episode

Republic — Equity Crowdfunding Case Study

Episode Description: Julia Báez Valentín (Fordham Law ‘19) and Soo Young Hong (Fordham Law ‘19) interview Chuck Pettid (Fordham Gabelli School of Business, MBA, Finance ‘06) on the crowdfunding platform Republic to discuss equity and crypto crowdfunding. They examine the safety, viability, and future of this relatively new approach to funding for startup companies.

Episode Roadmap:

[:30] Julia Báez Valentín and Soo Young Hong introduce themselves and give an overview of crowdfunding and related securities law regulations.
[3:43] Chuck Pettid introduces himself and his work with Republic and crowdfunding.
[7:11] Is crowdfunding a viable way to finance your business?
[8:59] A look at Crowd SAFE and Republic’s involvement in cryptocurrencies.
[13:07] Confronting and mitigating investor risks associated with issuing tokens.
[15:34] Republic’s commitment to diversity and serving underserved founders.
[18:33] All about Meet The Drapers.
[22:51] The value of providing feedback to rejected founders.
[25:08] Additional television productions in the works.
[30:16] Considering the future of crowdfunding.

Tweetables:

“The most important thing to note is that [with equity crowdfunding versus donation crowdfunding] the companies have to comply with federal securities regulations.” — Soo Young Hong
“[Regulation Crowdfunding] enables companies to raise funds they previously lacked access to, and those funds are coming from everyday people that now have the ability to invest in startups.” — Julia Báez Valentín
“[Crowdfunding] should be a tool in every startup’s toolkit.” — Chuck Pettid
“It’s been our theme at Republic from the beginning – founders always need to put their best foot forward.” — Chuck Pettid
“Take crowdfunding seriously. It’s going to be around for a long time.” — Chuck Pettid

Mentioned in This Episode:

Additional Resources: