A B Corp is a business that incorporates “social and environmental values” into its operations. B Corps are also known as Public Benefit Corporations, and they pay a sliding scale fee to become one. According to the B Corp website, 2,750 companies are signed up globally. The B Corps are a powerful force in reshaping business values and building an alternative corporate model. They have inspired a growing number of companies, such as Provenance, which allows consumers to check the ethical credentials of a product. Jamie Oliver announced that he will be turning his business into a B Corps, and there are presently 217 B Corps in the UK.
Etsy Became a B Corp in 2015
Etsy is an online marketplace where artists and other people can sell their handmade goods. It has a stated mission to “reimagine commerce” and has consistently pursued avenues to support its community, employees, and environment. In 2012, the company became a B Corp. Its certification is a mark of its commitment to these values and the company’s sustainability efforts.
Developed Program Ideas
Etsy is just one of the many companies that have become B Corps in recent years. In its first assessment, the company scored 80 points on a 200-point scale, up from eighty in 2013. The company scored 105 points in 2013, and 127 points in 2016. In 2015, Etsy received a “B Corp Impact Report,” which outlined its social impact. After the first assessment, Etsy hosted a B Corp Hack Day, where employees learned about the process and developed program ideas to help the company raise its score.
Meeting The Deadline Set Forth
Although it’s unclear whether Etsy will remain a B Corp, it has committed to re-incorporate as a PBC in Delaware. The company’s re-certification is contingent on its meeting the deadline set forth by Delaware’s revised PBC law, passed shortly after Etsy went public.
Etsy Uses Humankind Value as a Metric
While Etsy is no longer a Certified B Corporation, the company is weighing the advantages and risks of benefit corporation status. The company’s risk assessment includes potential 10b-5 suits and derivative shareholder lawsuits. The company has stressed the benefits of B Corp status but predicts that it will lose it in a few years.
Prominent Venture Capital Investors
Since its launch in 2005, Etsy has experienced phenomenal growth and now boasts over 27 million buyers and 2 million sellers, generating $2.4 billion in gross merchandise sales. The company’s growth has attracted the attention of prominent Venture Capital investors. The company has raised $266 million in total. In 2015, Etsy went public at a valuation of $1.78 billion, making it one of the first B Corps to go public.
B Corp and Public Benefit Corporation
To remain a B Corp and Public Benefit Corporation, Etsy must convert to a PBC by 2017. The process began in Delaware on August 1, 2013, and is available in 26 states. PBCs must identify their public benefit purpose in their charter and consider it when making decisions. They must also report on their progress to stockholders.
Etsy is a Public Benefit Corporation
While Etsy is not required to become a public benefit corporation in order to remain public, it does have an incentive to do so. While it has not made a decision to become one, it’s still worth noting that the company’s existing shareholders would have to vote for the change. As such, the company may want to wait until after its IPO to make this change. The new stockholders would have more control over the process.
Public Benefit Corporation
As a public benefit corporation, Etsy is required to meet certain standards. The company must meet the standards set forth by the B Lab, which requires the company to make a number of changes to its legal documents. As a result, Etsy will need to wait until 2017 before it can become a benefit corporation.
Socially Conscious Entrepreneurs
Etsy’s experience has provided lessons for other socially conscious entrepreneurs. While the process is not easy, it is possible to become a legal benefit corporation once it passes the necessary statutory requirements. However, this certification may not be the best solution for all companies. A socially responsible company needs to demonstrate a business model that can withstand the brutal short-termism of the capital markets.
Etsy Pays a Sliding Scale Fee to Become a B Corp
The nonprofit B Lab has recently certified Etsy as a B Corp, an organization that aims to promote social and environmental values in the business world. The B Corp designation is earned by companies that meet high standards for business and social responsibility. It is a sign of integrity and commitment to a higher standard of conduct than traditional corporations.
Based on the size of a Company’s Revenue
B Corporations can promote their social and environmental objectives by charging a fee to become certified. This fee is based on a sliding scale based on the size of a company’s revenue. This fee also entitles companies to use the Certified B Corporation name and logo on marketing and packaging. While many people may object to such a policy, the B Lab believes that businesses will more effective. If they have guided by their mission and not just profits.
Etsy’s Marketing Efforts Accelerated
In 2014, Etsy’s marketing efforts accelerated, with a focus on building self-sustaining international markets. According to the company’s S1 filing, the increase has largely due to a focus on buying-side search engine marketing (SEM) in foreign countries. The company’s CAC nearly doubled during this period, suggesting it has able to increase its revenue without significantly reducing its investment in growth.
