Hybrid structures:                                                              

• Provide versatility in adapting business form to the desired goals of the entrepreneur;
• Facilitate scaling of mission-driven entities by allowing revenue generation, thereby freeing such entities from reliance on charitable donations alone;
• Allow access to widest pool of capital, including equity investments and charitable donations;
• May increase ability to attract and incentivize talent through equity incentives for employees;

BUT:                                                                                                      

• It may be difficult and costly to establish and maintain;
• Organizational structure may be complex;                                                                            
• Require continual documentation regarding the flow of funds, services and personnel between the entities, to avoid negative tax consequences from private inurement and unrelated business income

Download guidance about setting up a Hybrid Structure