zlacker

>>modele+(OP)
Allowing startups to begin as non-profits for tax benefits, only to 'flip' into profit-seeking ventures is a moral hazard, IMO. It risks damaging public trust in the non-profit sector as a whole. This lawsuit is important

>>therei+4H
if you're not profitable, there should be no tax advantage, right?

>>abfan1+EQ
OpenAI was a 501C3. This meant donors could give money to it and receive tax benefits. The advantage is in the unique way it can reduce the funders tax bill.

>>hx8+0T
A donation is a no strings attached thing, so these donors basically funded a startup without getting any shares?

>>somedu+2U
Donations are not entirely without strings. In theory (and usually in practice) a charity has to work towards its charitable goals; if you donate to the local animal shelter whose charitable goal is to look after dogs, they have to spend your donation on things like dog food and vet costs.

Charities have reasonably broad latitude though (a non-profit college can operate a football team and pay the coach $$$$$) and if you're nervous about donating you can always turn a lump sum donation into a 10%-per-year-for-10-years donation if you feel closer monitoring is needed.