Ten years after the company was launched, the Proton Foundation becomes the primary shareholder of Proton AG through a donation from the founders and the first employee. As a result, it is permanently ensured that the mission of Proton, to create an internet that is able and willing to defend freedom, is not subordinated to profit objectives. The Foundation will also be an investor active in supporting companies and technologies that advance the vision of a free and open internet.
Andy Yen, as Proton’s founder, joined together by Jason Stockman (Proton’s co-founder) and Dingchao Lu (Proton’s first employee), have jointly endowed the non-profit Proton Foundation through a donation of Proton shares. These transfers and commitments from make the Proton Foundation the primary shareholder.
Proton has always prioritised its mission over profit targets. “We want to remake the internet in a way that is private by default and serves the interests of all of society, not just the interests of a few Silicon Valley tech giants. In short, we want to create an internet that is able and willing to defend freedom, no matter the cost”, explained Andy Yen in a post. The new structure “makes irrevocable our wish that Proton remains in perpetuity an organization that places people ahead of profits.”
The fact that Proton was not previously a non-profit has not prevented the company from supporting initiatives and organisations aiming to advance online freedom and democracy around the world. In the past five years, Proton has given grants worth more than 2.7 million dollars. Proton also continues to fund and operate services that can never be profitable, such as the Proton VPN projects to maintain free and open internet in countries like Iran and Russia.
However, adopting a Swiss non-profit structure provides additional security, which a corporation cannot achieve. Swiss foundations do not have shareholders, so Proton will no longer be dependent upon the goodwill of any particular person or group of persons. Instead, Swiss foundations and their board of trustees are legally obligated to act in accordance with the purpose for which they were established, which, in this case, is to defend Proton’s original mission. As the largest voting shareholder of Proton, no change of control can occur without the consent of the foundation, allowing it to block hostile takeovers of Proton, thereby ensuring permanent adherence to the mission.
Investing in companies and technologies
In addition to its governance role, the Proton Foundation will also be consolidating, continuing, and expanding existing grant-giving efforts to support organizations that are aligned with Proton’s mission to defend online and offline freedom around the world. To support this work, Proton is pledging 1% of net revenues to the foundation when conditions allow, further committing the financial success of Proton to the public good. Finally, the Proton Foundation will also be an investor active in supporting companies and technologies that advance the vision of a free and open internet. In pursuing these activities, the foundation will not act like a traditional venture capital investor, success will be measured by impact.
Securing independence with a profitable business
Proton can’t be subsidized but must have a profitable and healthy business at its core. For this reason, services will continue to be offered through the for-profit Swiss corporation Proton AG, which now operates under the supervision of the non-profit foundation, which is its primary shareholder. This change in governance does not signal a shift in how the core businesses are run. Proton is not profit-driven, but still must retain profitability as a core objective because a cornerstone of safeguarding Proton’s mission is independence through self-sustainability.
(Press release / SK)
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