This article carefully debunks each major tenet of the L3C “movement” and reveals the legal and practical realities under “the Emperor’s New Clothes.” Using foundation funds to offer market-rate returns to “tranched” investors is, at best, a complicated device; not appropriate for “branding” and simplistic appeals to social conscience. When a foundation contemplates making a program-related investment, the matter requires careful, individualized, professional assessment, not reliance on a branded template. In this context, the L#C is but a snare and a delusion
