WSJ: New Legal Structures for ‘Social Entrepreneurs’

WSJ outline some innovative legal structures designed for entrepreneurs who are driven as much by mission as money. The cost of using one of these new legal structures will vary depending on lawyer fees, but generally those fees shouldn’t exceed more than $10,000 for a start-up with fewer than 10 employees.

Here’s an overview:

L3C

Ideal for: companies that want to blend traditional capital with “philanthropic” capital, such as from foundations

Available to start-ups in: Vermont, Michigan, Wyoming, Utah, Illinois, North Carolina, Louisiana, Maine and soon in Rhode Island.

BENEFIT CORPORATION

Ideal for: companies that want to create a measurable positive impact while and providing greater transparency to the public

Available to start-ups in: Maryland, Vermont, Virginia, New Jersey, Hawaii, California and soon New York

FLEXIBLE-PURPOSE CORPORATION

Ideal for: companies seeking to do good on their own terms

Available to start-ups in: California.

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