Team:Arizona State E/CFC

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The Community Focused Corporation Model

ASSET advocates the Community-Focused Corporation model as a solution for not just expanding new markets for distinct technologies in synthetic biology, but also modern business. The structure itself is exactly how it sounds—a public corporation that redirects its primary purpose into developing the community.

Figure 1: The Cycle of Forprofit and Nonprofit Business Distribution

What is it?

A CFC by definition is a corporation that is publically committed to social good.

The corporation declares a particular social focus and develops products dedicated towards solving problems within that focus. A majority share of the profits is then reinvested into developing more solutions while the remainder is utilized the same way as other corporations, whether that is returning dividends to investors or marketing and supply chain operations.

In the UK, a 40% reinvestment of profits is necessary under tax code. In the United States and most other countries, there is no formally recognized legal entity for this structure. Thus, the CFC models described here are legal partnerships between a non-profit organization with a mother for-profit company.

The most important concept to note is that in these models, the majority of the profits do not come from the product itself. Since these are projects with primarily a social focus, the real profit comes from the outcomes of applying these products. This may be hard to understand, but bear with us for a second.

Take for example the structure of the company PharmAfri-can:

Figure 2: PharmAfri-can CFC Model