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L3C, Hybrid, and the future of corporate structures

Katie Heot July 10, 2009

How do we structure the organization? How do we structure the deal? We can’t do_______because of how our organization is set up.
You fill in the blanks. Those of us who have managed social enterprises and worked within the social capital market all know the headaches of legal structuring. It was for this reason that I attended SOCAP08 and it was surprising how many people faced the same challenges I did.
The term “social entrepreneurship” itself often sludges through a muddy mire of definitional challenges(as noted by Stanford Social Innovation review this week). An even greater challenge is the way in which governments define legal structures.
For those coordinating financial arrangements for both national and international projects, this issue is at the crux of SE complexity. Your structuring must cater to your mission and social goals. Legal limitations must define expectations for all stakeholders. Most importantly, innovative approaches to specific circumstances are essential. This can be seen in the case of Dial1298.
I’ve really enjoyed learning from Todd Johnson of Jones Day who is a real frontliner in tackling this challenge in California. Todd, B-Corp, Hanson Brigett, Mark Lane, all the folks working with the L3C structure, and others are contributing enormous effort to overcoming these obstacles.
One of last year’s great pannels touched on this topic. It was called “Market Creators” and Todd was the moderator.
If you are facing challenges in legal structuring or just interested in recent developments in the field, make sure to attend the “New Corporate Structures” pannel at SOCAP09 to hear about how to deal with these issues.

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