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I am happy to reveal that a non-profit legal entity for Mastodon, Mastodon gGmbH, is in the process of being entered into the German company register.

For context, I have been operating as a sole proprietor so far.

It's been in the works for 8 months but I didn't want to announce anything until everything was finalized just in case it didn't work out. Yesterday, I paid in the starting capital.

It wouldn't be possible without the help and advice of @mellifluousbox. More to follow in blog form.

@Gargron @mellifluousbox

This is awesome news! Maybe we'll see you on the FLOSS Foundations mailing list? It's a great place to share best practices among nonprofits in the space

flossfoundations.org/

@eloquence hello, Erik. Thanks for sharing about FLOSS Foundations. This is a news to me. I learned big thing today!

@Gargron @mellifluousbox

@be @Gargron I don't see why any venture capital giver would invest into a gGmbH which is not allowed to make an overall profit by law. So no need to worry.

@schmittlauch @Gargron Thanks. I am unfamiliar with German law so I didn't understand that.

Why people make legal entinties for projects?

@lucas there are a couple of reasons for creating a legal entity to govern floss projects: receiving donations, paying salaries/freelancers, holding infrastructure, holding trademarks, shielding contributors from legal risks, formalizing community/contributor ownership ...

@uniq @lucas @BollerwagenPicard most importantly: managing risk. If you do everything with your private money, you are liable with all your private money. In contrast, a (g)GmbH is liable only up to its share capital (basically the money the company "owns", the share capital of a (g)GmbH is at least 25 k€), so your personal ability to survive (, house, car, yacht) is not on the line. GmbH is basically comparable to LLC or Ltd in anglophone countries.

@Gargron Congrats! How can a non-profit have a capital. Is this a german possibility ?

@jums Yes. Lifted from Wikipedia: "A gemeinnützige Gesellschaft mit beschränkter Haftung (gGmbH) is a special form of a limited liability company with a charitable purpose. [..] They are required to spend any profits by the end of the fiscal year it was accrued, and are allowed to build capital reserves totaling 10 percent of annual donations or 33 percent of dividends received."

@Gargron

@galaxis @Gargron thx ! I didnt get that "gGmbH" was a legal entity and not just a random name.

@jums @galaxis @gargron

quite similar to a Community Interest Company in the UK (the two community radio stations in my area operate in this form).

Although the German version has slightly more strict rules about the use of profits and capital reserves (ours has a similar intention but doesn't state exact figures although the company must declare what positive social impact it has achieved each year along with the usual financial statements)

@vfrmedia interesting. What's the point of declaring your social impact ? Is there a threshold or a sanction if there is not "enough" ?

@jums what happens to the profits and the directors and other staff salaries also have to be declared, there are rules on what can be done with the assets as well and a government regulator (so there are various potential sanctions, on top of those that could already be handed to directors of a limited company who do not comply with their statutory obligations)

(the whole set of info about how it works is at the link below)

gov.uk/government/publications

@uniq @jums @galaxis no, b-corps are for profit companies while gGmbh's are not for profit, like 501c3 companies in America

@jums Having capital doesn't necessarily imply creating profit. Just having the means for production.

@Gargron
Congrats, time to make a post about the implications so that othet projects can get inspiration.
I just hope things won't go just like mapillary
@mellifluousbox

@Gargron
Great news! Great for you as well as all of us! Thank you for what you made!

@Gargron @mellifluousbox Congrats! A very promising position for the future of the ecosystem.

@Gargron @mellifluousbox

Which of the possible legal reasons for being a nonprofit are you using for this?

dejure.org/gesetze/AO/52.html

@guenther @mellifluousbox "Die Förderung von Wissenschaft und Forschung, insbesondere auf dem Gebiet der Informatik"

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