Bubblin is a Public Benefit Corporation ⚖️
- 3 minutes
- October 15, 2019
[Last update: Dec 07, 2019]
Business benevolence is a hard problem.
Entrepreneurs often start with noble intentions but with growth and size we are soon lost on reason. Unless we remain careful, we end up stepping on all the wrong stones easily only a few years down the line.
A beloved startup soon turns into this vile monster in the public-eye, an “interest group” that everyone seems to pile their hate on. The trust is eroded and only a moat can keep us afloat. It’s a hard place to be.
And that’s why you hear phrases like:
- “competition is for losers”,
- “build your moat quickly”,
- “too big to fail”,
- “what’s your superpower?” etc.
With the founders summarized into this den of insecurity where a for-profit corporation’s only goal is to exploit every opportunity to increase the shareholder value, all there is left to do is to leave the organizational direction in the hands of career executives. To do what they want however they please.
Exit, be sidelined or join the party to not be left out of the thing that you created.
You either die a hero, or live long enough to see yourself become the villain.
— Harvey Dent, The Dark Knight Rises.
I think that exploitive design of a for-profit entity is the most common cause of failure among later-stage companies. The requirement of infinite growth is unsustainable and it punctures through the bounds of effective and healthy leadership sooner or later. Turning all the good into a bad.
And on the web, where the token of attention is the sole-driver of economic value, this means only a few years of compressed existence. Until something new and shiny arrives and the corporation starts losing relevance.
A non-profit approach
The other option is of course a non-profit vehicle.
Like the Mozilla Foundation.
Go all out in a hope that enough folks will see value in your work and donate in a meaningful way. This strategy worked surprisingly well for Mozilla intially (which is awesome) at a time when the Internet Explorer was the evil monster of the browserland.
But what about now?
Not so great, I think.
This is just an opinion and not meant to throw shade at any of the awesome work that Mozilla does. To me it appears that a non-profit vehicle can easily become a tool at the hands of competing for-profits. For example, it can be said that it was Mozilla that helped Google defeat the Internet Explorer and opportuned Chrome to become the new evil monster of the browserland.
Secondly, the correlation between being a non-profit and a truly benevolent company isn’t a given either.
Look at the NRA, for example.
They like the Mozilla Foundation are a 501(c)(4) non-profit too, but to what end?
In my opinion, being good or bad, or doing what is right especially during a challenging time is ultimately a personal choice. A choice that is defined by not only the integrity of the founder but also by their personal or emotional security.
I think both integrity and security are critical ingredients here.
It’d be safe to say here that the type of entity (for-profit or non-profit) has little to do with how a company would behave in future when it has grown. Long term benevolence depends only on the security and integrity of the leadership.
Setting up Bubblin Superbooks
I am glad that we are documenting these thoughts as we go about building Bubblin Superbooks from scratch. Sonica and I have decided to register a PBC type of Delaware Corp with the following statement of purpose:
…to produce universally accessible books for consumers on the web by designing, developing and distributing book making software tools that deepen the effectiveness of the Internet and books together as a single unified resource.
Super thankful to the folks at Clerky for helping us on the topic of PBC. A hearty thanks to Greg Newby of Gutenberg and Varun Singh of 8x8 for helping me understand the provisions of entity formation easily.
I am hopeful that Bubblin will not only start with a noble goal but it will also grow up to become a company that does good for the humanity.