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Kickstarter becomes a Public Benefit Corporation

For a long time, Kickstarter’s founders expressed that they had no interest in selling the company and that they wanted Kickstarter to be a public trust somewhat like Craigslist (but without the religious aversion to graphics in the site interface). While Craigslist keeps its finances notoriously close to its vest, though, Kickstarter has been quite transparent about its metrics.

Now Kickstarter has codified its public interest by becoming a Public Benefit Corporation. In a nutshell, that means the company must consider its public good alongside of and sometimes ahead of maximizing profit. This includes measures such as charity, transparency, avoiding tax loopholes and running an ecologically conscious company — a better defined set of obligations than Google’s famous “Don’t be evil.” unofficial motto. One aspect of the new structure that will directly benefit backers is

Kickstarter no doubt has good intentions and has been a great resource for creators, but it — like Indiegogo — has had its feet held to the fire for projects that have not come to fruition and the steps it has taken or avoided to try and resolve such costly disappointments for consumers.  For now, the FTC has started going after the creators themselves when fraud is suspected. But Indiegogo has recently experimented with insurance that backers can buy to protect themselves against projects failing. Hopefully, Kickstarter’s company’s stepping up its commitment to do good will inspire it to find better ways to protect consumers.

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