LAW AND SOCIAL ENTREPRENEURSHIP

HOW TO STRUCTURE SOCIAL ENTERPRISE FOR IMPACT

 

This is a full two-hour lecture at Harvard’s iLab on how to structure your social enterprise for impact. The lecture addresses the three types of social enterprise business models, then compares and contrasts seven legal structures including:

  • Corporation
  • B Corp Certification
  • Benefit Corporation
  • Flexible Purpose Corporation
  • LLC
  • L3C
  • Nonprofit

ABA’s LLC INSTITUTE | 10/18 – 10/19 | ARLINGTON, VA

The Business Law Section of the American Bar Association is hosting the LLC Institute on October 18-19, 2012 at the Le Meridien hotel near Washington D.C. (Arlington, VA).  The entire program looks excellent, but the “Drafting LLC Agreements for Nonprofit and Social Enterprise LLCs” session on October 18 may be of special interest to our readers. 

Program Chair:

J. William Callison, Partner, Faegre Baker Daniels LLP, Denver, CO.

Panel:

Carter G. Bishop, Professor of Law, Suffolk University Law School, Boston, MA;

Cassady V. Brewer, Assistant Professor, Georgia State University School of Law, Atlanta, GA;

J. William Callison, Partner, Faegre Baker Daniels LLP, Denver, CO; and

J. Haskell Murray, Assistant Professor, Regent University School of Law, Virginia Beach, VA.

Each panelist has written about using LLCs in social enterprise and/or about low-profit limited liability companies (“L3Cs”) specifically, with varying degrees of criticism or suggestions for improvement.  The articles are available on SSRN:  Professor Bishop (here); Professor Brewer (here); Mr. Callison (here and here); and Professor Murray (here).

PROFIT + PURPOSE

Over the last year, I’ve been lecturing at Harvard Law and Stanford Law about structuring social enterprises for impact. I always have people asking me to see the slides, but have never publicly shared the slides. Today I’m releasing those slides to the public.

This is meant to be an introductory presentation that touches on the possible legal structures for social entrepreneurs. The presentation discusses Corporation, B Corp Certification, Benefit Corporation, Flexible Purpose Corporation, L3C and Nonprofit legal structures. Within each legal structure, the presentation touches on Formation, Management, Taxation and Capital.

Click below to access the presentation. Leave your feedback in the comments section. Thanks!

 

SOCENTLAW LIVE! – NYC

This fall you have not one, but two, opportunities to attend a live lecture about the legal structures for social enterprise in New York City. Click on the date below for more details.

 

October 11th / 7:00 PM / Skillshare HQ

November 8th / 7:00 PM / General Assembly 

 

Class Description:

Have a great idea for social innovation, but trying to figure out whether it should be a nonprofit or a for-profit? Have you heard something about these new hybrid legal structures but can’t figure out what the heck they do? If so this course is for you! We’ll be digging into:

  • 501(c)(3)
  • L3C
  • Benefit Corporation
  • B Corp Certification
  • LLC
  • Corporation
This course is taught by Kyle Westaway. Kyle believes in the power of the market to create a positive social and environmental change. He has helped build Biographe – a sustainable style brand that employs and empowers survivors of the commercial sex trade. Kyle is the founding partner at Westaway Law – an innovative New York City law firm that counsels social entrepreneurs.Kyle is a Cordes Fellow. He lectures at Harvard Law School and Stanford Law School. He launched Socentlaw – a blog about the legal side of social enterprise. Kyle has been featured by We Are NY Tech and Dowser; and writes for Huffington Post, GOOD, and Social Earth. He is Chairman of the Board for both the Excel Charter School in Brooklyn and The Adventure Project – a nonprofit that seeks to add venture capital to social entrepreneurs in the developing world.

 

photo: elsonpro

A NEW ROAD FORWARD

Have you ever tried to organize a social enterprise and find yourself frustrated by your options for legal structure? Well… we know the feeling. As a social entrepreneur and an attorney, I’ve dealt with this frustration both personally and on behalf of my clients.

As a leader of a social enterprise, you are an innovator, but the current structures stifle that innovation. You are forced to chose between two out-moded options: either organize as a for-profit or nonprofit entity, and maybe use some Frankenstein-like techniques to find something that sort of works, but is sub-optimal to say the least. The bottom line is that neither the for-profit not the nonprofit entity addresses the needs of social enterprise.

There must be a new road forward.

Fortunately, there is a group of legal minds around the country that are starting to cut a new road across the U.S. legal landscape. We are creating a new corporate form that will empower social enterprises. This is an exciting time in the social enterprise movement as a whole, but specifically in the legal structures supporting the movement.

This blog is a space dedicated to discuss and disseminate information on the legal structures, both old and new, including Nonprofit, For-Profit, L3C, the For-Benefit Corporation and other emerging legal structures connected to the social enterprise movement. We hope that be aggregating and curating the knowledge about this area of law, social enterprises will have an understanding of all their options, and make decisions that will set them up for success.