Why We Made Hallow a Public-Benefit Corp

Our mission at Hallow is to help the world find peace & purpose through prayer & meditation, and to help us all build deeper and more meaningful relationships with God. We believe that if we all just let God into our lives, He will change the world. We take this mission incredibly seriously. Every decision we make at Hallow is guided by the goal to help as many people grow in prayer as possible.

One of the important decisions we made when founding Hallow was how to structure ourselves as a legal entity. Our goal was to find a structure that allowed us to best achieve our mission and build what we think God is asking us to build. We wanted a structure that supported building a great product, bringing together a world-class team, and achieving great scale to impact as many people as possible as quickly as possible, while always staying accountable to our mission and values. 

As we looked at the different ways that we could structure Hallow to best support our mission, we considered both traditional not-for-profit and for-profit models. (We also thought hard about whether to charge for Hallow Plus. This is a related, but separate decision e.g., many non-profits charge fees. You can learn more about how we landed where we did, here.)

When we looked into the 501(c)(3) non-profit structure, the most attractive part was that the organization’s purpose is put very explicitly in the Articles of Incorporation, which helps to make sure that it always comes first. We saw three challenges, though, with the non-profit structure to achieving our mission at scale. First, non-profit leaders generally commit a lot of time and resources towards fundraising campaigns, taking away from the time and resources they and their teams could spend focused on building world class products. Second, 501(c)(3)’s are constrained to philanthropic pools of funding, which are generally not setup to support rapid scale and growth. And finally, the non-profit structure can make it difficult to offer competitive compensation to attract top talent, leaving technology and product quality to often fall behind over time.

We then looked at the for-profit C-Corp model, which is the norm for start-ups (though interestingly also the structure of several strong mission-driven faith companies e.g., bulletin providers, Altar bread suppliers, Catholic publishers). The C-Corp is a powerful model that helps young companies to compete with much larger businesses to attract top talent (by providing employees with the opportunity to share in the future upside through equity) and build a truly world-class product. C-corps also have the option to raise money from the large pool of growth capital (e.g., VCs and institutional investors), to fund growth and achieve their missions at a much faster and larger scale. Our biggest concern with the C-Corp structure was the risk of prioritizing profits and shareholder value above the mission of the company. Even though many companies say that their mission comes first, the only legal requirement in their charters is to maximize shareholder value.

Neither of these models seemed to fit our mission. We seemed to find ourselves struggling with the goldilock’s problem of having two options, but neither that were “just right.” It was then that we learned about Public-Benefit Corporations. It’s a structure that has been around since the mid-2000s, but is still relatively new, and it combines elements of both for-profit C-Corporations and non-for-profit 501(c)(3) organizations. Because Public-Benefit Corporations are a subset of C-Corps, they are able to raise growth capital and use equity to attract talent. At the same time, though, the structure allows for the organization to have two equal purposes in its legal charters, enabling (and actually legally requiring) them to prioritize both shareholder value and their social mission. 

No model is perfect, and the Public Benefit-Corp doesn’t solve all of our concerns. But after a lot of prayer and discussions with both start-up and spiritual advisors, we decided it was the best structure for Hallow. It gives us the best ability to build a world-class team and product, achieve our mission of helping the world to pray, and assure that growing profitably never comes ahead of our mission. 

We are still very early on in our journey, but so far have been incredibly blessed. We’ve been able to build an incredible talented and mission-driven team, partner with some amazing mission-driven and secular investors, and begin to achieve our mission at a scale none of us would’ve imagined possible. We’ve been able to lean on an incredible set of faith advisors (priests, nuns, bishops, professors, authors) to ensure that we stay true to our mission & Church teaching and have been diligent about turning to God in prayer with every major decision we’ve faced. 

I would love to hear any feedback you have. Feel free to email me at alex@hallow.app. At the end of the day our goal is simply to serve you as best as we can, and to be a tool through which God might change lives. I’ll close with a recent note we got from a user that hits on the importance of our mission better than I ever could. Glory be to God.

This app has been an answer for my weary soul. Tears pour as I try to impress on you how deeply I am impacted by the guidance into simply being with God. This is where my soul is finding peace for the very first time.