Reevaluating the L3C: Mistaken Assumptions and Potential Solutions

Matthew F. Doeringer

Ropes & Gray LLP

May 7, 2010

This paper tracks the development of the L3C, analyzes why the assumptions held by the proponents of the L3C have not come to fruition, and examines the possibilities to help the L3C reach its potential of opening new streams of capital for social enterprise. Part I discusses the current use of Program-Related Investments ("PRIs") by foundations in the United States. Part II examines the development of the L3C. Part III explores current status of the L3C and its underlying assumptions. Part IV analyzes certain proposed federal legislation and IRS regulations that could affect the L3C. Part V addresses the future of the L3C and proposes policies to ensure that the L3C serves its intended purpose, suggesting that any successful reforms need to focus on the distribution of the costs involved with PRIs rather than just focusing on minimizing these costs.

Number of Pages in PDF File: 26

Keywords: L3C, social enterprise, social entrepreneurship, hybrid entities, double bottom line

Open PDF in Browser Download This Paper

Date posted: October 24, 2010 ; Last revised: October 30, 2010

Suggested Citation

Doeringer, Matthew F., Reevaluating the L3C: Mistaken Assumptions and Potential Solutions (May 7, 2010). Available at SSRN: https://ssrn.com/abstract=1696267 or http://dx.doi.org/10.2139/ssrn.1696267

Contact Information

Matthew F. Doeringer (Contact Author)
Ropes & Gray LLP ( email )
Prudential Tower
800 Boylston St.
Boston, MA 02199
United States
Feedback to SSRN

Paper statistics
Abstract Views: 1,305
Downloads: 307
Download Rank: 76,779
Paper comments
No comments have been made on this paper