I decided to write this article as a long form explanation to this seemingly simple question. I didn’t lose my mind, I didn’t get bit by the idealist dreamer’s bug. I thoroughly conducted research on the advantages and disadvantages of all available options and consulted with lawyers, advisors, non-profit founders, and fellow entrepreneurs. I looked inward and outward, reflecting on myself as a cofounder and human, reflecting on the business itself, and the external world that we would be bringing Is It Clean into. Only then did we decide to make Is It Clean a nonprofit. 

I also wrote this article so that others may see our thought process and perhaps use a similar process when starting their next project or initiative. 

My decision making process started with step 1: laying out all the options before me. Before we could decide on the best business structure, I wanted to get a very clear understanding of each option we’d consider. Note: I am not a lawyer and this is my own context regarding these types. Don’t take these as legal definitions and consult your own lawyer before making your own decisions!

1. For Profit
   • This is the option I had the best understanding of. All my prior businesses have been for profits. This is your cookie cutter business – make revenue through selling goods or services, hopefully make a profit off that action, pay taxes on that profit to the government. If you want to bring in financial capital to the business, you raise money from either angel investors, private equity, or venture capital. With for profits, you own the company and can sell portions of that ownership (equity) to investors. You cannot receive tax deductible donations. The goal of the for profit, in its bylaws, is to maximize shareholder value. Plain and simple. 
2. Public Benefit Corporation
   • A Public Benefit Corporation is basically a for profit company that adds to its bylaws that it may put a certain public benefit ahead of shareholder value. It has to report a quantified measurement of the public benefit it provided in order to maintain its status as a PBC. It pays taxes just like a for profit, there is still an ownership function where you can raise money by selling equity to investors. You still cannot receive tax deductible donations. But it’s a little bit more mission focused since you can declare a public benefit and actually be protected by your bylaws for putting that public benefit ahead of shareholder value. 
3. B Corp
   • A B Corp is a company that has been certified by an independent certifying body called B lab. Companies who want to be certified as a B Corp undergo an extensive audit and are held to a higher standard of “good” than a Public Benefit Corporation.The certifying B-Corp assesses each company on 5 categories: governance, workers, community, the environment, and customers. B Corps are still for profit companies. Many people see the B Corp logo and think the company is a nonprofit, but that is a common misconception. B Corps have owners, can have investors, and most of the wealth generated CAN go to those few owners and investors, so long as the company passes B Corps audit and standards (which are rigorous and extensive.).Because the review process to become a B Corp is more rigorous and has more challenging, specific standards, this to me is a step above a regular public benefit corporation in terms of making the benefit of the public a priority. 
4. Nonprofit 
   • A nonprofit does not act as a for profit in the sense that the main goal is not shareholder value. Its main goal is NOT to increase shareholder value and make the founders and investors rich. A nonprofit has no ownership structure and is led by a board of directors. A nonprofit cannot sell equity or ownership in return for capital. It can, however, receive tax deductible donations. Usually nonprofits are created for initiatives that do not have a business model based on the profitable sale of a product or service – meaning you must bring in donations to fulfill the service or deliver the product because the math doesn’t work – there is a loss incurred from the operations of the business. But that’s not always the case. Nonprofits can be profitable, so long as no individual is receiving those profits.

After understanding the fundamentals of each option, I went to work talking to fellow entrepreneurs, lawyers, nonprofit founders, and different consultants. I wanted to see other people’s reasoning for and against running Is It Clean as a nonprofit.

In the beginning, my co-founder Ally and I had a feeling we wanted to go the nonprofit route. After this research we were a whole body, 100% yes on running Is It Clean as a nonprofit. 

Here are the reasons why we chose a nonprofit: 

1. Maintain credibility and Trust
   • I looked at many other companies when doing my research for Is It Clean. I noticed that the companies I gravitated towards and started to trust were the companies that I felt didn’t have financial considerations biasing them. Companies like EWG or Cornucopia Institute inspired me. Meanwhile, other rating sites (sites that rate other companies’ products or services) in different industries that were for profits left me with a small seed of doubt. Even if I loved their rating system and followed their advice, there was this underlying thought of, “is the company that is getting rated paying for this in some way?
     
     Will the rating site maintain their standards as they scale? Will they put their values before their incentive to increase shareholder value?” 
     
     I also saw rating companies that led people to an individual’s course or training or health plans – all of which, of course, were for profit. This felt misaligned for me. 
     
     I want people to go to Is It Clean and KNOW that the ratings, articles, and education they are receiving are unbiased and trustworthy. While a nonprofit doesn’t guarantee that, after all, there are corrupted nonprofits, I felt that if we made Is It Clean a for profit business, we’d be starting off on the wrong foot immediately. It creates a shaky foundation. As a nonprofit – we can put the truth, justice, and science over things like shareholder value, profit, revenue, clicks, likes. 
     
     We intend Is It Clean to be one of the most trusted sources on the internet for food education. A safe haven for people to get unbiased, truthful information about what they put in their bodies. In order to accomplish that mission, we felt structuring ourselves as a nonprofit was critical. 

2. Ensure all wealth generated goes back to the community
   • After reviewing our website, one of my entrepreneur friends got a bit more serious and asked the question, “why a nonprofit?” Having witnessed people close to him run nonprofits, he possesses a relatively greater understanding of them compared to others, albeit not through firsthand experience. After I gave him my spiel, I asked him what he thought. He gave me some reasons to think about it, but his biggest reason was that it would “put a ceiling on my own value potential. My wealth generation opportunity here would be limited no matter how hard I work or the value I provide.” AKA no matter how hard I worked on Is It Clean, or how successful the company was, I’m not going to generate a massive amount of personal wealth for myself. My income will be capped and decided by a board. 
     
     I sat with that for a few days and mulled over his words. I came to the conclusion that if the biggest reason (and most honest reason) to not create the nonprofit and opt for a for profit was because of my own wealth generation, then I’m not being the person I want to be. How could I look people in the eye and tell them this business is purely for the good of society when my own motives and greed are deciding one of the first and more foundational decisions – what formation to choose. I hear over and over from entrepreneurs and venture capitalists, “you know there is nothing wrong with making a lot of money while doing good. You can do both!” While it’s a cute sentiment and makes people feel better, I think it’s a flawed statement. It doesn’t take into account the real world. While it sometimes happens, we wanted to draw a clear line in the sand about what Is It Clean puts first. I believe, from witnessing this first hand, that there will be many times in a business’ life where you have to choose, wealth generation vs doing the right thing. And at the end of the day, incentives rule. If a human is incentivised to do something, they will inevitably follow that incentive, and then proceed to justify and rationalize (see doctors, big pharma, and our medical industry.) The study “Affiliate marketing, informational asymmetry and product quality” found that affiliate marketing can create an informational asymmetry between companies and consumers, whereby companies have greater knowledge about their products and are able to manipulate the information provided to consumers in order to maximize their own profits.
     
     For example, companies may be more likely to promote products that offer higher commission rates for affiliates, even if those products are of lower quality or not well-suited to consumers’ needs. Similarly, companies may be less likely to provide accurate information about the features and benefits of their products, or may exaggerate the benefits in order to generate more sales through affiliate links.
     
     The study suggests that this bias may be mitigated by increasing transparency and providing consumers with more information about the incentives and motivations behind affiliate marketing. Additionally, the study highlights the importance of independent product reviews and third-party information sources in helping consumers make informed purchasing decisions.
     
     I saw first hand at my last company, which raised around $25m from venture capital, how incentives drive people’s behavior. When push came to shove and shit got real, I saw people who I really believed had good values act selfishly and compromise their claimed values. Now, there are positive examples like Patogonia and its founder, Yvon Chouinard, who really walk the walk in terms of doing the right thing. I personally believe Yvon’s move to relinquish all of his shares in Patagonia and transfer them to a nonprofit to fight the environmental crisis is the most inspirational business move in history. And it flies directly in the face of the self centered, short-term thinking culture of current venture capital and startup fever we have in this country. Another cool and rare example is Zendaya making sure the crew on one of her movies all received shares of the movie. Our current system rewards founders and investors, while taking advantage of the workers and teams that do most of the work. The wealth generation and ownership at a typical startup is tremendously skewed towards the founders and large investors. It’s not uncommon for an early employee to get almost nothing for years of hard work when a company “goes public.” One study that sheds light on the issue of startup founders hoarding too much equity and employees not owning enough of the company is “Employee Equity: How Much?” by Fred Wilson, Brad Feld, and Bijan Sabet. Specifically, the study finds that many startup founders are focused on preserving their own equity ownership and are reluctant to dilute their ownership stakes by allocating equity to employees. This can result in a situation where employees do not have enough ownership in the company to feel truly invested in its success and may be more likely to leave for other opportunities. Overall, this study highlights the need for startup founders to consider the importance of employee equity ownership in building a strong and sustainable company culture, and to be willing to make the necessary trade-offs.
     
     Add to that the communities and areas that are exploited for this corporation’s gain. More often than not, none of the wealth generated from these companies reach the community, for the public benefit. 
     
     By choosing a nonprofit, while creating revenue generating channels like a for profit, we are ensuring that any and all wealth generated by Is It Clean goes back to the community, not a few founders and investors – so it can benefit hundreds of thousands who need it, rather than helping half a dozen who are already doing more than ok. I want all the income generated at Is It Clean being used to make a positive impact on this world, not funding someone’s private jet, even if that someone would have been me. 

3. Ability to think long term 
   • Our economy is driven by quarterly results. If a company grows profits quarter over quarter, their stock goes up. If they lose profits, their stock goes down. Three months. Our economy, and most people involved in this game, are hyper focused on the next 3 months. Maybe those with a bit more foresight look ahead one year. An even smaller group of people are looking two years out. Venture capitalists are so concerned about showing how smart they were with their investment selections from the previous year so they can raise their next fund and prove to other people how smart they were by raising another fund. If a company doesn’t hit a billion dollar valuation in its first 2 years, it’s a failure. 
     
     This short term thinking is a major reason why we have stripped our planet of most of its natural resources, de-forested most of our wilderness, and overfished our oceans.  
     
     This short term thinking has also led to the obsession with quick fixes and symptom solving. God forbid we look at the root cause of our depression or heart failure – just give us a pill so we can pretend we’re okay. Solutions like this only last a short time and don’t actually solve anything. 
     
     Companies don’t think long-term anymore. The pressure to grow for growth’s sake has forced companies to think quarter by quarter, from one round of funding to the next. This short-term thinking keeps the companies (and our society) in a constant state of urgency, fear, and anxiety. When you are battling for your survival, you literally can’t think long-term. This impedes many of our smartest minds from focusing on solving real problems, and directs their attention to trivial pursuits geared toward near-term, vanity business metrics – too often our business leaders are meeting about their Facebook ad budget for next month and too seldom they are discussing impacts on the environment, their own team members, and the communities they serve.
     
     I did this at my last company. We were so hyperfocused on impressing investors, getting to the next round of funding, growing for growth’s sake, that we lost sight of the mission. We started making short-term decisions that hurt us long term. 
     
     With starting Is It Clean, I wanted to model Patagonia’s 100 year planning. They expect to be in business (and on this planet) for 100 years. Which means their decisions come from that lens. If you plan to be alive for 100 years, you wouldn’t strip the world of resources that you’ll need in 100 years. I want to follow the 7 generations principle (making decisions from the lens that these decisions should benefit people 7 generations into the future).
     
     By becoming a nonprofit, and not playing into the growth for growth’s sake craze running rampant in society today, I believe Is It Clean will be able to think long-term and make decisions that support a sustainable future for our society, planet, and company. I intend Is It Clean to be around for 100 years, and when I zoom out that long, the next 3 months don’t seem so important. A company should be defined by the net positive it has on the Earth and all its inhabitants, not how much it can produce in 90 days or how rich it makes investors this year (or ever).

4. Keep the energy pure
   1. I recently went to a 10 day silent meditation course called a Vipassana. The organization is a nonprofit. They take it a step further than a normal nonprofit. New students, people who have never attended a course and experienced a Vipassana, cannot make a donation until after the course. In fact, the only donations accepted at all are from previous students – no corporations, no funds, no pacts. Only people who have experienced a course for themself can donate. The founder of the organization set it up like this on purpose. In his words, he wanted to “keep Vipassana away from commercialization”. He wanted to keep the practice, the experience, and the organization pure. His intention has been maintained. When you go to a Vipassana you can feel the loving, giving nature of the experience. Everyone who works at the center is a volunteer. Since you cannot donate beforehand and everyone serving you is a volunteer, you quite literally feel the generosity of everyone who has come before you. It’s because of the old students that you are able to experience what you are experiencing. 
      
      Coming from the western world, I have never experienced something like this before. The overwhelming sense of generosity and giving inspired me. It felt nice. It felt genuine. It felt human.
      
      I want the spirit of Is It Clean to remain pure, free from commercialization. I want the company to permeate generosity, compassion, and a true sense of community. I want the mission to remain front and center, without any compromise. I believe by being a nonprofit, we have a better chance at maintaining that pure energy of compassion, love, and generosity. And I believe with that energy we have a much better chance to accomplish our mission of making healthy eating easy.

You are not your words, you are your actions. At the end of the day, you can tell who a person is by their actions. What do they stand for? Saying cool statements is impressive, knowing facts is neat, pontificating values and beliefs to a group feels nice – but what actually matters is how you show up. The actions you take and the stands you make say more than words ever could. 

With Is It Clean we are taking that action. We are choosing to put the good of the community and the planet first. 

Here’s a poem I wrote that touches on the thread of why we chose a nonprofit: 

One piece of Advice

If you’re going to stay good in this world filled with vice
Then here’s one piece of advice
Don’t compromise your values
Don’t bend them at all 
Don’t break for a second
For when you uphold them
You add a brick to the wall
When you stand by your values
And choose to stand tall
Your muscle gets stronger
You’re less likely to fall
It’s not always easy
And can be scary to face
But in the end it’s worth it
Because you make the world
A better place

Being a nonprofit allows us to maintain credibility and trust, distribute all wealth back to the community, think long-term, and keep the energy pure. To us, that’s the winning formula for a better world. 

Our mission is to make healthy eating easy and being a nonprofit, we believe, gives us the best chance to accomplish that mission. It may not be easy, but it’s the right path to walk. 

With love, 
Christian