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1
Social Entrepreneurship
and vulnerable social groups
Edited by: Nikolay A. Dentchev, Jason Roncancio Marin,
Claudia Alba, Georgios Outsios
Coordinated by: Nikolay A. Dentchev
i
SOCIAL ENTREPRENEURSHIP AND
VULNERABLE SOCIAL GROUPS
Editors:
Nikolay A. Dentchev1,2,
Jason Jahir Roncancio Marin1,3,
Claudia Alba Ortuño1,
Georgios Outsios1,
1Vrije Universiteit Brussel, Belgium,
2University of National and World Economy, Bulgaria,
3GREST - Universidad Nacional de Colombia, Colombia
Co-authors in alphabetic order:
Abel Diaz Gonzalez1, Bart Leyen2, Claudia Alba2, Diana Kopeva3, Eliana Vassiliou4,
Figen Algül5, Iliya Kereziev3, Jorge Salas Vargas6, Philippe Eiselein7, Romel Brun6,
Sami Huohvanainen8, Savvatou Tsolakidou9,
1Maastricht University, The Netherlands
2Vrije Universiteit Brussel, Belgium
3University of National and World Economy, Bulgaria
4Entrepreneurship and Social Economy Group (EKO), Greece
5Marmara University, Turkey
6Universidad Católica Boliviana, Bolivia
7Odisee, Belgium
8Metropolia, Finland
9National and Kapodistrian University of Athens, Greece
Coordinated by: Nikolay A. Dentchev
ii
Social Entrepreneurship and Vulnerable
Groups
ERMIScom project “Common curricula for diversity: education in media and
integration of vulnerable groups”, has been financed within the framework of
Erasmus+ program (KA2- Strategic Partnerships for Higher Education, Nr 2020-1-
EL01-KA203- 078981). The Project has developed open online educational material
(seven digital books) for a master’s degree program regarding media and integration
of vulnerable groups, in English language. The project was coordinated by the
Communication and the Media Department of the National Kapodistrian University
of Athens (17184) and participated the Bahçeşehir University, Turkey, the E.K.O.
Greece, the Metropolia Ammattikorkeakoulu, Finland, the University of National and
World Economy, Bulgaria, and the Vrije Universiteit Brussel. More information for
the project is available on the website: https://ermiscom.media.uoa.gr/
Please cite this book as follows:
Dentchev et al. (2022). Social Entrepreneurship and
Vulnerable Groups, e-book 3 in ERMIScom project, Common
curricula for diversity: education in media and integration
of vulnerable groups. Athens: National Kapodistrian
University of Athens
Copyright Year 2022
Disclaimer
The European Commission’s support to produce this e-book does not constitute an
endorsement of the contents, which reflect the views only of the authors, and the
Commission and the Greek National Agency – IKY cannot be held responsible for any
use which may be made of the intellectual output contained therein.
Creative commons attribution
ISBN 978-960-466-282-1
iii
Web page: https://ermiscom.media.uoa.gr
Title: Common curricula for diversity: education in media and integration of
vulnerable groups-ERMIScom
The ERMIScom project has been financed within the framework of Erasmus+
programme, KA2- Strategic Partnerships for Higher Education, Nr 2020-1-EL01-
KA203- 078981.
Acknowledgments
We want to thank everyone who has made this book a reality. We thank the students
of the social entrepreneurship courses at the Vrije Universiteit Brussel and the
Brussels School of Governance (BSoG) during 2021-2022 for their input, participation,
and feedback. We also thank all participants in various multiplication events in the
ERMIScom and Eramus+ project frameworks. Finally, we thank all the partners of the
projects in which the authors and editors are involved for all their support and good
vibes; without their positive attitude towards social entrepreneurship, this book
would not be a reality. Sincere thanks.
iv
Contents
Introduction
By Dentchev A. N., Roncancio J.,
Alba C., and Outsios G.
Page 1
Chapter 8
“Social Impact and Impact Measurement”
By Kereziev I., Kopeva D.
Page 91
Chapter 1
“Introduction to Social Entrepreneurship”
By Alba C.
Page 7
Chapter 9
“Ecosystems for Social Impact”
By Gonzalez A., and Leyen B.
Page 103
Chapter 2
“Variety of Social Enterprises”
By Tsolakidou S.
Page 16
Chapter 10
“Funding for Social Enterprises”
By Einselein P.
Page 116
Chapter 3
“Social Value Creation”
By Huohvanainen S.
Page 33
Chapter 11
“Social Innovation and Inclusive Business Models”
By Tsolakidou S.
Page 128
Chapter 4
“Challenges in Social Entrepreneurship”
By Kereziev I., and Kopeva D.
Page 42
Chapter 12
“Social Entrepreneurship in the Refugee Context”
By Tsolakidou S.
Page 142
Chapter 5
“Business Model Development for Social Enterprises”
By Vassiliou E.
Page 53
Chapter 13
“Social Entrepreneurship at the Bottom of the Pyramid”
By Alba C., and Brun R.
Page 153
Chapter 6
“Business Model Innovation for Social Enterprises”
By Huohvanainen S.
Page 69
Chapter 14
“Community Media Case Studies”
By Algül F.
Page 161
Chapter 7
“Scaling Social Impact”
By Eiselein P., Diaz A., and Salas J.
Page 79
Authors and Editors Bios
Page 178
v
Acronyms
APICCO: Artistic Partnership in Community's Creative Opening
BM: Business Models
BMD: Business Model Development
BMI: Business Model Innovation
BoP: Base of the Pyramid
BVA: Blended value accounting
CBA: Cost-benefit analysis
CEO: Chief Executive Officer
CEA: Cost-effectiveness analysis
CSR: Corporate Social Responsibility
DNA: Deoxyribonucleic acid
EU: European Union
GECES: European Commission Expert Group on Social Entrepreneurship
IBM: Inclusive Business Models
NGOs: non-governmental organization
NWICO: New World Information and Communication Order
SAA: Social accounting and auditing
SBM: Sustainable Business Models
SDGs: Sustainable Development Goals
SE: Social Entrepreneurship
SEs: Social Entrepreneurs
SI: Social Innovation
SMEs: small and medium enterprises
SROI: Social Return on Investment
SOFFA: Social Fashion Factory
SSE : Social Solidarity Economy
SENTIM: Social Entrepreneurship for Immigrants
ToC: Theory of Change
UN: United Nations
WISE: Work Integration Social Enterprise
2
Introduction
Social Entrepreneurship constitutes a crucial driver of social innovation
(Hall, Matos, Sheehan, & Silvestre, 2012). Social entrepreneurs use creative
business models to resolve social and environmental challenges (Evans et
al., 2017). By doing so, they develop much-needed innovations for
contemporary societies, positively impacting vulnerable social groups. The
term vulnerable social groups refers to divergent groups of people who
remain at risk of poverty or social exclusion due to different factors (e.g.,
physical disabilities) and backgrounds (e.g., substance abuse, past criminal
convictions). In this context, entrepreneurial solutions to vulnerable groups
generate valuable social impact, and therefore this book embraces both
topics of social entrepreneurship and vulnerable social groups.
Social entrepreneurship has drawn the attention of practitioners and
research during the last decades (Gupta, Chauhan, Paul, & Jaiswal, 2020),
while more universities have started integrating the topic into their
curricula. With this trend in mind, the consortium of Erasmus+ project
ERMIScom asset out as one of its intellectual outputs the development of
an undergraduate course on social entrepreneurship. Under the leadership
of the VUB Chair of Social Entrepreneurship, the ERMIScom consortium
presents this book with course material for the undergraduate and
postgraduate teaching levels. The overall learning outcome for students in
this course is to develop three key competencies:
► Creative problem-solving of complex social issues.
► Development and implementation of strategies that increase the
social impact of social entrepreneurs.
► Critical analysis of the challenges that vulnerable social groups are
facing.
To develop these competencies, we will focus on three learning objectives
for the students: knowledge, skills, and attitudes.
► To develop a comprehensive knowledge of social
entrepreneurship.
► To acquire a thorough understanding of the challenges faced by
social enterprises.
► To acquire knowledge of how social enterprises can provide
solutions to vulnerable social
Our learning objectives in skills development are:
► To develop the capacity to develop a business plan of a social
enterprise.
Social
Entrepreneurship
constitutes a
crucial driver of
social innovation
3
► To develop the capacity to implement a business plan of social
enterprise.
► To develop the capacity to evaluate the social impact of social
enterprises.
Our learning objectives in attitudes development are:
► To develop an attitude of critical thinking.
► To develop an attitude of open-mindedness.
► To develop an attitude of creative thinking.
The above-mentioned learning objectives are integrated in the material
presented in the fourteen chapters of this book. Each chapter includes
preparatory reading and is linked to the cases presented in the last
chapter. Below, a summary of all chapters is provided.
Figure 1. Chapters distribution
In chapter one, Introduction to Social Entrepreneurship, we address the
main concepts related to social entrepreneurship and how these vary
depending on the level of analysis (Saebi, Foss, & Linder, 2019). Also, the
main implications and typologies of social entrepreneurship are outlined
4
(Zahra, Gedajlovic, Neubaum, & Shulman, 2009). We then address the
creation process of social enterprises from inspiration and ideation until
the implementation stage. We finalize this chapter by showing the
relevance of social entrepreneurship to the context of vulnerable social
groups and the link to Sustainable Development Goals (SDGs). We use
exemplary cases to help the reader connect the theory with real-life cases.
In chapter two, Variety of Social Enterprises, we review the spectrum of
social enterprises and various relevant business models (Alter, 2007). We
also review the different legal structures they can adopt to partner with
their communities. In chapter three, Social Value Creation, we address how
to be successful when combining social value creation with business
opportunities. We also analyze how social value can be created through
market success and by addressing environmental and social goals
(Sinkovics, Sinkovics, & Yamin, 2014).
In chapter four, Challenges of Social Enterprises, we analyze and compare
challenges experienced by conventional entrepreneurs to those
experienced by social entrepreneurs (Goyal, Sergi, & Jaiswal, 2016), as well
as the strategies (and their implications) that social entrepreneurs use to
overcome them. Chapter five is dedicated to Business Model Development
for Social Enterprises. We present the critical elements of business models
in social enterprises (Joyce & Paquin, 2016) and how they change according
to their context. We also explain in-depth the designing and
implementation of a social business model, especially in the opportunity
identification stage.
In chapter six, Business Model Innovation for Social Enterprises, we start
with an introduction to business model innovation (Evans et al., 2017) and
how to proceed with their development and testing. Before discussing
Social Innovation, we discuss some tools that can be used for this, such as
the Lean Start-up Methodology (Reis, 2011) and Design Thinking. Chapter
seven, Scaling of Social Entrepreneurship, includes the theory of scale and
several strategies social entrepreneurs can use to scale their social impact
(Busch & Barkema, 2020). We also provide information about developing
the social venture strategy plan, aligning mission and strategy in a social
enterprise, and how to position the firm for social and strategic advantage.
In chapter eight, Social Impact and Impact Measurement, we address the
importance of impact measuring for social enterprises (Dees, J. G.,
Emerson, J., & Economy, 2004), and the design and implementation of the
impact measurement strategy for social enterprises. The above is
complemented by the theory of change and the typical challenges social
enterprises face regarding impact measurement, how they transform ideas
into opportunities and impact, and how this is communicated. In chapter
nine, Supportive Ecosystems for Social Enterprises, we address the main
support mechanisms of ecosystems for social enterprises and the variety of
5
stakeholders in the ecosystem that impact their business models (Adner,
2017). We highlight the more prominent organizations in ecosystems in
support of social enterprises.
In chapter ten, Funding Social Enterprises, we discuss the principles that
should be followed when choosing the social enterprise’s funding strategy
(Dentchev et al., 2020). We also present arguments regarding funding as an
issue and why so many social enterprises have financial difficulties. Lastly,
we analyze the funding characteristic in each social enterprise life cycle
phase.
In chapter eleven, Social Entrepreneurship, and Inclusive Business Models,
we make the connections between social entrepreneurship, minorities,
and smallholders. We also discuss the integration of disadvantaged groups
in the business models and the concept of circular economy, which has
been gaining relevance in recent years. Chapter twelve, Social
Entrepreneurship in the Refugee Context, investigates how social
enterprises contribute to social inclusion and problem-solving. We also
discuss the barriers that refugee social entrepreneurs face. In chapter
thirteen, Social Entrepreneurship in the Bottom of the Pyramid Context, we
address the BoP concept's evolution, the BoP entrepreneurs' challenges
and opportunities, and the link between the opportunities with frugal
innovation. Lastly, chapter fourteen presents several social entrepreneurial
and social innovation Media Cases from Bulgaria, Portugal, Turkey, and
generally the European Union (EU) that allow the reader to understand the
different concepts discussed throughout the book.
References
Adner, R. (2017). Ecosystem as Structure: An actionable construct for
strategy. Journal of Management, 43(1), 39–58.
Alter, K. (2007). Social Enterprise Typology. Virtue Ventures LLC, 12(1), 1–
124.
Busch, C., & Barkema, H. (2020). From necessity to opportunity: Scaling
bricolage across resource-constrained environments. Strategic
Management Journal, (November 2017), 1–33.
Dees, J. G., Emerson, J., & Economy, P. (2004). Strategic tools for social
entrepreneurs: Enhancing the performance of your enterprising nonprofit
(Vol. 207). John Wiley & Sons.
Dentchev, N., Eiselein, P., Vander Velpen, K., Bouckaert, M., & Diaz, A.
(2020). A financial Guide for Social Entrepreneurs. die Keure.
Evans, S., Vladimirova, D., Holgado, M., Van Fossen, K., Yang, M., Silva, E.
A., & Barlow, C. Y. (2017). Business Model Innovation for Sustainability:
6
Towards a Unified Perspective for Creation of Sustainable Business Models.
Business Strategy and the Environment, 26(5), 597–608.
Goyal, S., Sergi, B. S., & Jaiswal, M. P. (2016). Understanding the challenges
and strategic actions of social entrepreneurship at base of the pyramid.
Management Decision, 54(2),
Gupta, P., Chauhan, S., Paul, J., & Jaiswal, M. P. (2020). Social
entrepreneurship research: A review and future research agenda. Journal
of Business Research, (October 2019), 1–21.
Hall, J., Matos, S., Sheehan, L., & Silvestre, B. (2012). Entrepreneurship and
innovation at the base of the Pyramid: A recipe for inclusive growth or
social exclusion? Journal of Management Studies, 49(4), 785–812.
Joyce, A., & Paquin, R. L. (2016). The triple layered business model canvas:
A tool to design more sustainable business models. Journal of Cleaner
Production, 135, 1474–1486.
Reis, E. (2011). The lean startup: How today’s entrepreneurs use
continuous innovation to create radically successful businesses (Crown
Business, ed.). New York.
Saebi, T., Foss, N. J., & Linder, S. (2019). Social Entrepreneurship Research:
Past Achievements and Future Promises. Journal of Management, 45(1),
70–95.
Sinkovics, N., Sinkovics, R. R., & Yamin, M. (2014). The role of social value
creation in business model formulation at the bottom of the pyramid -
Implications for MNEs? International Business Review, 23(4), 692–707.
Zahra, S. A., Gedajlovic, E., Neubaum, D. O., & Shulman, J. M. (2009). A
typology of social entrepreneurs: Motives, search processes and ethical
challenges. In Journal of Business Venturing.
Lorem ipsum dolor sit amet, consectetur adipiscing elit. Etiam aliquet eu mi
quis lacinia. Ut fermentum a magna ut eleifend. Integer convallis suscipit
ante eu varius.
7
Introduction to
Social Entrepreneurship
Chapter 1
Photo by Noah Buscher on Unsplash
Claudia Alba Ortuño,
Vrije Universiteit Brussel, Belgium.
8
Chapter 1: Introduction to Social
Entrepreneurship
Aim
The present chapter aims to provide a brief and concise introduction to
the concept and nature of social entrepreneurship (SE). By the end of
this chapter, the reader should be able to identify how social
enterprises work, and what their distinct characteristics and main
challenges are.
Expected Learning Outcomes
► To gain an understanding of the main concepts related to
social entrepreneurship
► To identify the main characteristics and challenges of social
enterprises.
► To evaluate the relevance of social enterprises in different
contexts.
Keywords: Social Entrepreneurship, corporate social responsibility,
sustainability
1.1. Definition of Social
Entrepreneurship
The importance of SE has been growing in the last decades (Dacin,
Dacin, & Tracey, 2011). SE differentiates itself from other forms of
entrepreneurship as it prioritizes the achievement of social goals (Mair
& Marti, 2006). An early definition of SE was developed by Boschee
and McClurn (2003), who described it as non-for-profit initiatives
currently looking for funding strategies. Others define SE as a
commercial business with a socially responsible practice. Yunus (2007)
explained SE as a tool to solve social problems (Yunus, 2007). Mair and
Marti (2006) incorporated the creation of social value in the venture’s
primary aim to define social enterprises. The idea of “more than for
profit” was also suggested as an improved way to view social
“SEs need the
support of society to
be sustainable”
9
enterprises compared to the for and non-for-profit debate ( Austin et
al., 2006; Ridley-Duff, 2008).
Most authors agree that social entrepreneurs develop solutions for
social or environmental challenges where other stakeholders, such as
governments or business organizations, fail. SEs do this by creating
value and using resources in an innovative way (Mair & Marti, 2006). In
this sense, social entrepreneurship has a bottom-up approach in which
the social entrepreneur starts solving problems locally before
expanding (Letaifa, 2016). The case of the Grameen Bank, founded by
Professor Yunus in 1976 -to provide microcredits- is seen as a
pioneering example of a profitable business that solves the challenging
social problem of access to funding for vulnerable populations (Yunus,
2007).
The structuration theory (Giddens, 1984) states that SE is highly
connected with the social problem the parties involved are trying to
solve and, therefore, is also related to the context in which social
issues occur. Thus, in social entrepreneurship, context is a crucial
dimension of analysis (Letaifa, 2016; Mair & Marti, 2006). From the
institutional theory viewpoint, social entrepreneurship can change
norms and deliver a higher social value, creating conflicts between
social enterprises and their context (Mair & Marti, 2006).
A widely used definition was developed by Zahra (2009, p.9), who
states: “[S]ocial entrepreneurship encompasses the activities and
processes undertaken to discover, define and exploit opportunities in
order to enhance social wealth by creating new ventures or managing
existing organizations in an innovative manner”
The non-profit sector is primarily relying on subsidies and
philanthropy. Social enterprises often work similarly, but this is not
central as they avoid a dependency in their operations from
government funding or donations (Boschee & McClurg, 2003). Social
enterprises aim thus to become self-sufficient to avoid the risk of being
dependent on others.
1.2 The Social Entrepreneurs
The backgrounds of SEs are also different compared to traditional
entrepreneurs (Mair & Marti, 2006). They have special leadership
skills, a passion for realizing their vision, and strong ethical values (Mair
& Marti, 2006). SEs are mostly seen as heroic. However, the focus on
individual success limits their ability to learn from their failures (Dacin
et al., 2011).
10
SEs need the support of society to be sustainable. Therefore, engaging
society with SEs goal and providing shared social value might lead to
success (Letaifa, 2016). Social entrepreneurs have their social mission
as a core element. Either they employ or support people from
vulnerable groups as the disabled or poor, or they sell mission-driven
products that impact a specific social problem (Boschee & McClurg,
2003). In their case, as they have an economic and social goal, their
success is measured mostly in their impact and social value, as any
profit is reinvested to keep increasing their social value (Boschee &
McClurg, 2003). SE identify social opportunities following five criteria
(Zahra, Rawhouser, Bhawe, Nubaum, & Hayton, 2008):
► Prevalence: SE mostly focuses on sectors with a higher
frequency of social problems. Also, it relates to physical
distance. Social entrepreneurs tackle issues in their
communities, especially at the beginning.
► Relevance: A connection between the opportunity and the
entrepreneur's background that includes their personal
experiences, values, goals, and identity.
► Urgency: Urgent social problems such as natural disasters push
entrepreneurs to engage in the search for solutions.
► Accessibility: Refers to the perceived difficulty in which
traditional mechanisms can solve a social problem. Usually,
governments and charities will try to solve more accessible
social challenges, leaving unserved opportunities that require a
more significant investment.
► Radicalness: Sometimes, solving a social opportunity requires
novel solutions that existing organizations cannot perform due
to their organizational structures.
1.3 Social Entrepreneurs’ Backgrounds
In society, there are different movements of Social Entrepreneurs
(Dentchev et al., 2020). We can divide the movements into five
categories:
► Philanthropists, Church, and State: Develop non-profit
activities to cope with social issues such as poverty and
education. They usually work with donations, and if these
donations stop or reduce, they cease their activities.
► Civil Society Initiatives and NGOs: These initiatives typically
focus on a specific human or environmental right. It also
includes groups that develop cultural activities or sportive
11
activities. They usually finance their activities or work with
subsidies and donations (Alter, 2007).
► Social Economy Movement: This movement combines social
activities with economic goals. They have commercial activities
and use the profits to achieve social goals.
► The base of the pyramid (BoP) Movement: This group refers to
around 40% of the planet’s population that lives in extreme
poverty. This movement, according to Prahalad and Hart
(2002), started in the late 90ies. BoP populations were seen as
a potential market for multinational companies. In addition,
London and Hart (2011) indicated that these people were also
entrepreneurs because that’s their way to survive, by creating
their own sources of income.
► Social Innovation Movement: In this movement, social
enterprises develop a complete business model to achieve
social goals systematically. They usually have some subsidies
and donations to start, but their goal is also to be financially
independent and sustainable.
Each of these movements has an ecosystem and works in different
networks. However, when the connection between the various
movements happens, overlaps are reduced and could lead to better
support of social enterprises (Dentchev et al., 2020).
1.4 Social Entrepreneur’s Critical
Success Factors
Wronka (2013) reviewed existing knowledge in SE and identified eight
factors that research recognizes as critical for the success of social
enterprises. The review focused primarily on Western Europe and the
United States. The factors included (i) Leadership, (ii) Partnership, (iii)
Triple bottom line planning, (iv) attractiveness and clarity of innovative
concept, (v) business planning and marketing, (vi) short and long-term
benefits management, (vii) local community engagement and- (vii) risk
management. Social enterprises need strong leaders to negotiate while
maintaining the social values at the enterprise's core. The
entrepreneur must be qualified to understand the decision-making
process's economic, financial, and social implications. Social
enterprises must develop strong partnerships to create a more
significant impact. The partnerships are with local public sector
institutions.
An essential element for the success of social enterprises is a clear plan
for measuring their economic, social and environmental impact. The
attractiveness and clarity of innovative concepts are critical for any
12
enterprise. A significant challenge for social enterprises is to create
market potential and generate income to maintain the venture's
viability. Business planning and marketing are also important. A
successful social enterprise requires (a) a short as well as a long-term
business plan, (b) strategies to engage local communities and
stakeholders, and (c) a risk management strategy incorporating social
and environmental risks to economic risk.
1.5 Networks and Social
Entrepreneurship
Social entrepreneurship opportunities emerge from individuals, for-
profit and not-for-profit organizations (Letaifa, 2016). It is their
interactions that create networks for social transformation. The
activities of social entrepreneurs are driven by a social mindset, which
leads them to share their knowledge, identify support, and
communicate their work (Dacin et al., 2011). For instance,
organizations like Ashoka and Sistema B aim to connect social
enterprises worldwide. Their goal is to create a network of social
entrepreneurs and promote a culture of “change makers” (Dacin et al.,
2011). The relevance of international networks for social
entrepreneurs is that most social enterprises are locally embedded;
therefore, such global networks allow rapid diffusion and opportunities
to replicate SEs solutions (Dacin et al., 2011).
The above also highlights the “dark side” of social entrepreneurship.
When social enterprises internationalize, benefits and rewards tend to
increase. Yet, internationalization leads social entrepreneurs to enter a
competitive race for resources and exploit their position with the risk
of neglecting their social mission and shifting focus to profits (Dacin et
al., 2011). This is also known as mission drift. Networks also help to
create markets adequate for social entrepreneurs. Traditional markets
do not value social improvements or social values. Therefore, it is
challenging to identify when a social entrepreneur is creating sufficient
value, as market acceptance cannot be used as a parameter (Dees,
1998).
The process of different actors combining to apply business principles
to solve social problems is called collective social entrepreneurship
(Montgomery, Dacin, & Dacin, 2012). Collaboration happens in need of
specific resources. There are several manners in which this happens:
► Same sector pooling of resources: When several actors of the
same sector share resources and knowledge. This helps them
reduce costs and become more efficient. Several actors' work
in exposing the social problem supports its relevance.
13
► Cross-sector pooling of resources: Less common than same-
sector pooling but has the unique advantage of bringing
together different sectors to tackle a social problem. It brings
similar advantages to same-sector pooling in addition to the
benefit of multiple perspectives.
► Same sector trading of resources: Exchange of complementary
resources in the same sector. It allows for combining strengths
and expertise. It also works with the unique resources of each
partner as the reaching to specific stakeholders.
► Cross-sector trading of resources: Actors of different sectors
combine to solve pressing social issues. Similarly, to the
pooling of resources, they can reach a broader number of
stakeholders through different lenses.
► To effectively manage the collaboration between actors, three
strategies can be used (Montgomery et al., 2012):
► Framing: The support for a social enterprise should come from
ideas constructed collectively, and all collaborators should be
part of this process with commitment.
► Convening: Includes three phases. In the first one, core issues,
goals and communications are established. The second phase
is collective learning, and the third phase includes the co-
creation process.
► Multivocality: Social enterprises need to have different voices
or narratives to speak to the different audiences that they
have.
1.6 Social Entrepreneurship as
emancipation tool
Emancipation is the process of setting a person or a community free to
pursue their goals (Chandra, 2017). Engaging in SE helps emancipate
people from vulnerable social groups towards social reintegration. The
emancipation related to social enterprises can be market-based or
relations-based (Chandra, 2017).
• Market-based emancipation
► Enterprise building: Including people from vulnerable social
groups in SE indirectly encourages new perspectives, new ways
of thinking, and positive attitudes.
• Relations-based emancipation
► Broadening of social networks: Connecting people from
vulnerable social groups with other groups and incentives
fostering social interaction and mobility.
14
► Performing humbling work: Serving others helps develop a
sense of equality and mutual respect.
► Working harmoniously: Building harmonious relations with
customers, suppliers, state agencies, police, media, etc. With
social enterprises, people find common ground, and later
other related topics can emerge.
► Role modeling: Members of vulnerable groups and groups at
risk of social exclusion who succeed become role models for
others.
1.7 Conclusions
This chapter presents the definition of social entrepreneurship, the
types of backgrounds that social entrepreneurs have, the criteria for
success and how social enterprises can use their networks as a tool for
poverty eradication. As a result, the concepts, and elements necessary
for the reader to understand the subsequent chapters are provided, as
well as the key elements that could serve to alleviate the conditions of
vulnerable groups can be put into practice.
References
Alter, K. 2007. Social Enterprise Typology. Virtue Ventures LLC, 12(1):
1–124.
Austin, J., Stevenson, H., & Wei–Skillern, J. (2006). Social and
commercial entrepreneurship: same, different, or both?.
Entrepreneurship theory and practice, 30(1), 1-22.
Boschee, B. J., & McClurg, J. 2003. Toward a better understanding of
social entrepreneurship: Some important distinctions.
Chandra, Y. 2017. Social entrepreneurship as emancipatory work.
Journal of Business Venturing, 32(6): 657–673.
Dacin, M. T., Dacin, P. A., & Tracey, P. 2011. Social Entrepreneurship: A
Critique and Future Directions. Organization Science, 22(5): 1203–
1213.
Dees, J. G. 1998. The Meaning of “Social Entrepreneurship.”
Dentchev, N., Eiselein, P., Vander Velpen, K., Bouckaert, M., & Diaz, A.
2020. A financial Guide for Social Entrepreneurs. die Keure.
15
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16
Variety of Social Enterprises
Chapter 2
Photo by Markus Spiske on Unsplash
Savvatou Tsolakidou,
National and Kapodistrian University of Athens, Greece.
17
Chapter 2: Variety of Social Enterprises
Aim
This present chapter enables the readers to familiarize themselves with
the main concepts associated with social economy and social
enterprises. The definition of social enterprises is examined, in addition
to their role in the social economy, through the creation of partnerships,
solidarity organizations, and other associations. Moreover, reference is
made to the collaboration between social entrepreneurs and vulnerable
social groups, including socially excluded populations. Some business
models are presented to understand social enterprises holistically, and
their legal structures are analyzed. Thus, the chapter presents the theory
of social enterprises and their impact on the social economy.
Expected Learning Outcomes
► To define the main concepts related to social economy and
social enterprises
► To understand the variety of business models and legal
structures available
► To learn about the theory of social enterprises and their impact
Keywords: Social entrepreneurship, social enterprises, social
economy, vulnerable social groups
2.1. Introduction
The rapid changes in economic systems during recent years resulted in
the need for new economic models, further to the traditional distinction
between the public and the private sector. More specifically, the global
financial crisis led to higher unemployment and social exclusion rates.
“The global
financial crisis led
to higher
unemployment
and social
exclusion rates”
Photo by Diego PH on Unsplash
18
These are among the fundamental factors which gave birth to the concept of social
economy (also referred to as the “third” sector). Additional push factors towards
creating this sector were the chronic economic deficiencies in both the public and the
private sectors (Agafonow, 2014).
According to Maslow’s theory, people’s actions throughout their life are oriented
towards satisfying as many needs as possible in the most efficient and profitable manner
(Papanis et al., 2005). Building on this theory, social economy focuses on the promotion
of the general interest and the expansion of social production in multiple sectors, such
as health, education, culture, and environmental awareness (Tsombanoglou, 2008).
Consequently, the third sector addresses social needs, such as poverty alleviation, equal
access to the labor market and social inclusion that are often overlooked by the private
section which is oriented solely towards profit maximization.
The social economy’s contribution to the fight against
social inequalities is crucial since it adopts the
fundamental principles of social solidarity
Over the last decades, the third sector has developed at a steady pace, both
internationally and nationally. The social economy’s most significant achievements are
social enterprises and the involvement of vulnerable communities in the supply and
production chain (Dey & Steyaert, 2016). In general, social enterprises aim to provide
goods and services to the market at a low-cost while at the same time undertaking a
social mission (Hota, 2021).
Therefore, the social economy’s contribution to the fight against social inequalities is
crucial since it adopts the fundamental principles of social solidarity and cooperation by
involving vulnerable social groups in the economy and by offering them equal
opportunities to access social services. In line with the above, the chapter examines the
concepts of social economy and social enterprises in detail by presenting key definitions,
their role, their legal structure, and their intended social impact.
2.2 Defining social economy
The social economy lies between the private and the public sector. It is steadily gaining
momentum since various associations and social enterprises have emerged to cover
existing welfare gaps not addressed by the private and the public sector (Montgomery
et al., 2012; Santos, 2012). Interestingly, while the social economy appeared in practice
during the 21st century, its history dates to ancient times. Given that there is no
universal definition, it is essential to present it as described in the relevant literature.
19
The social economy can be defined as a distinct economic system aiming at social
cohesion, economic development, and environmental protection, by promoting
solidarity (Defourny, 2001; Santos, 2012). The European Commission (2016) defines a
social economy as a well-organized form of economy which strives not only to make a
profit for investors but also to promote democracy, equality, and solidarity. Thus, the
primary purpose of social economy is delivering services or goods through cooperative,
non-profit, and voluntary organizations, both on an international and national level.
Another term used in recent literature is “Social Solidarity Economy” (SSE). According to
SSE, ordinary people have an active role in shaping all dimensions of human life,
including economic, social, cultural, political, and environmental aspects. SSE is relevant
in all economic sectors, i.e., during production, finance, distribution, exchange,
consumption, and governance (Ripess, 2015). To achieve socio-economic
transformation, SSE does not address a specific group of people to exclude
discrimination. Emphasis is placed on the establishment of associations and
cooperatives (Pless, 2012; Ranville & Barros, 2021).
Based on the above, the third sector aims to fulfill social needs, including access to
shelter, psychosocial services, and vocational training (to develop practical and
occupational skills), which are not typically covered by the private and public sectors.
Considering that specific social groups (e.g., young workers, migrants, and persons with
disabilities) face discrimination when accessing the labor market. SEs working with these
social groups help them integrate into society, and it has become evident that a welfare
system based on minimum benefits is insufficient for their wellbeing.
20
An integral part of the social
economy are social enterprises (SEs)
2.3 The spectrum of social enterprises
An integral part of the social economy are social enterprises (SEs) since
their role in social economy is key regarding the promotion of social and
environmental goals through the production of goods and/or services
(Agafonow, 2014; Huybrechts & Nicholls, 2012).
SEs can have different legal entities. They could be cooperative
organizations, solidarity companies, associations, and start-ups. SEs’ main
goal is to meet needs that are not covered by public authorities, in
addition to providing vulnerable social groups with equal opportunities.
Social innovations are considered necessary to stimulate social action and
combat exclusion (Tsombanoglou, 2008). As a result, both society and
entrepreneurs benefit from SEs since the latter tackle social issues by
either focusing on producing a specific product/service or serving the
needs of a specific group of citizens.
It is worth noting that there are two categories of social enterprises
(European Commission, 2015). The first type of SEs offers social services or
goods to vulnerable groups, ensuring their access to accommodation,
health care, training programs, etc. The second category promotes a social
Photo by Antonio Janeski on Unsplash
An integral part of the
social economy are social
enterprises (SEs)
21
aim, such as the social inclusion of vulnerable groups through producing
goods and/or services. When SEs produce goods or services, their goals
are twofold. On the one hand, they serve a predetermined social mission.
On the other hand, they adopt administrative practices and legal regimes
of private companies to gain financial profit and enhance market
competitiveness (Mitzinneck & Besharov, 2019; Waddock & Steckler,
2016)
It is worth noting that a democratic mindset characterizes both SEs and
social cooperatives; their economic activities are at the heart of multiple
pioneering initiatives of the 19th and 20th century, across Europe
(Nyssens & Defourny, 2013). However, social enterprises differ from other
forms of the third sector, due to their competitive nature, their autonomy
from public authorities and the sale of innovative services and/or products
(Smith & Kistruck, 2016; Vansandt & Baugous, 2009).
Lastly, SEs share a wide range of standard characteristics which lead to
long-term benefits for their consumers and employees. According to
Defourny and Nyssens (2013), three criteria reflect the economic
dimension of social enterprises: 1) the production of goods and/or selling
services, 2) the economic risk, and 3) the low-paid work. Other factors
which play a vital role in defining social economy are benefiting the
community by integrating vulnerable social groups in the labor market,
adopting a democratic mindset and the feeling of collectivity, creating an
ethical workplace climate, and promoting autonomy. Based on a
comparative synthesis report on SEs in Europe (European Commission,
2020), most SEs were small enterprises, while the most significant SEs
were in Italy (102.461), France (approx. 96.600), United Kingdom (30.753)
and Poland (29.535). The smallest number of SEs reported were in Malta
(31-62), Estonia (121), Montenegro (150), and Cyprus (190) as can be seen
in Table 1.1. as follows:
22
Table 2.1 Estimated number and degree of acceptance of social enterprises
Country
Year
Estimated
number of SEs
Number of SEs
per million
inhabitants
Estimated number of
employees
Degree of
data
reliability
SE concept
use &
Acceptance
Albania
2018
379
132
2.000-2.500
Low
Low
Austria
2015
Approx. 1.535
Approx. 174
N.A.
Low
Low
Belgium
2017
18.004
1.530
572.914
Average
Average-
High
Bulgaria
2015-
2017
Approx. 3.700
Approx. 525
26.000
Average
Average
Croatia
2018
526
128
N.A.
Average
Average
Cyprus
2017
190
22
N.A.
Very low
Low
Czech
Republic
2018
3.773
356
N.A.
Average
Average
Denmark
2018
411
71
N.A.
Low
Average
Estonia
2016
121
92
1.603
Average
Low
Finland
2018
1.181
214
Approx. 52.500
High
Average
France
2015-
2017
Approx.
96.603
1.414
>1.187.249
Average
Average
Germany
2017
77.459
936
N.A.
Average
Low
Greece
2019
1.148
107
N.A.
High
Average
Hungary
2016
15.855
1.621
72.642
Average
Average
Iceland
2017
258
740
1.488
Low
Low
Ireland
2009
3.376
699
>25.000
Low
High
Italy
2017
102.461
1.694
894.800
Very high
Very high
Latvia
2018
Approx. 200
Approx. 103
N.A.
Average
Average
Lithuania
2016
3.476
1.237
N.A.
Average
Average
Source: http://ec.europa.eu/social/easi
23
Finally, the Work Integration Social Enterprise (WISE) has a fundamental role in
fighting against social exclusion in Europe. Its entrepreneurial activities include social
services, childcare services, educational and training programs for employment,
cultural activities (e.g., music), housing organizations, health care services, and
environmental organizations (Pizarro & Miranda, 2022). Another important
European project is SENTIM (Social ENTrepreneurship for IΜmigrants), established in
2005, which facilitates entrepreneurship by informing and training migrants to be
integrated into the labor market as active social entrepreneurs (Bachousi, 2018).
2.4 Social entrepreneurs co-creating with the
community
Other theories regarding social entrepreneurs either describe them as people with
leadership skills and specific characteristics or focus on their actions as part of a
group or a network that collectively aims to resolve a social issue (Harima &
Freudenberg, 2019). This way, social entrepreneurship is understood as a business
model that implements innovative ideas by entering a new market or creating a new
product or forms of industrial organizations. Moreover, it can adopt new
technological solutions and production methods or acquire new sources of finance,
raw materials, and procurement products (Walczak-Duraj, 2010). Based on Defourny
and Nyssens (2013), there are two schools of thought for resolving social problems.
The first school focusses on earned income, and it describes a non-profit approach
that emphasizes the organization's social mission. The second school focusses on
social innovation, and it is primarily concerned with social entrepreneurs’ ambition
to combat social exclusion through social innovations.
The co-creation of value with the committee is based on two distinct concepts. On
the one hand, Vargo and Lusch’s theory (2004) is based on the macro perspective of
economic development and evolution models. On the other hand, Prahalad and
Ramaswamy (2004) approach social value from a strategic management and market
competition perspective, claiming that it serves as a guide for enterprises to adjust
their business strategy and operation (Jianxin, Hongjia & Massimiliano, 2019). The
common point of both theories is that value co-creation may not be achieved if
consumers are not involved. This concept corresponds to an “offer and demand”
marketing process. Specifically, social value co-creation addresses community needs
via establishing partnerships (Tsombanoglou, 2008). These collaborations have the
will and the power to support the integration of vulnerable social groups, e.g.,
women, young people, persons with disabilities, migrants, and refugees.
2.5 Variety of SE business models
SEs operate similarly to traditional businesses. However, their ultimate goal is to
achieve financial sustainability by financially supporting themselves instead of solely
relying on grants and donations. To examine the main social enterprises business
models, it is necessary to understand the base-of-the-pyramid (BoP) approach. In
24
economics, the poorest socio-economic groups are at the bottom of the economic
pyramid, which proves the unequal distribution of wealth among the levels of social
stratification (Antonelli & Scellato, 2019). However, Hart (2002) strongly supports
that this fact does not exclude them from participating in the global market.
While these groups lack access to recourses and education opportunities, activities
like sales and production can be considered as poverty alleviation tools that might
provide BoP communities with some income (Dentchev, 2020). Therefore, counting
with a proper business model, might contribute to BoP sustainability (Goyal et al.,
2016), that consequently may lead to economic impact (Dentchev, 2020). However,
it is also possible to contribute to a social impact from within a business model by
means of a social business model (Schaltegger et al., 2016; Dentchev, 2020).
A social business model can be considered as the set of steps a social enterprise
follows in order to achieve not only economic profit but also the creation of social
impact (Hall et al., 2012; Hamby et al., 2017). According to this definition, there are
nine fundamental social enterprise business models whose role is crucial in defining
social economy through trading activities and the social impact produced (see table
2.2).
25
Table 2.2 Business models of SEs
Business model
How it works
Examples
Key success factors
Entrepreneur support
Sells business support to its
target population
Microfinance organizations,
consulting, or tech support
Appropriate training for the
entrepreneur
Market intermediary
Provide services to clients to help
them access markets
Supply cooperatives like fair
trade, agriculture, and
handicraft organizations
Low start-up costs allows
clients to stay and work in
their community
Employment
Provide employment opportunity
and job training to clients and
then sells its products or services
on the open market
Disabilities or youth
organizations providing work
opportunities in landscape,
cafes, printing, or other
business
Job training
appropriateness and
commercial viability
Free-for-service
Selling social services directly to
clients or a third-party payer
Membership organizations,
museums, and clinics
Establishing the appropriate
fee structure vis a vis the
benefits
Low-income client
Similar to fee-for-service in terms
of offering services to clients but
focuses on providing access to
those who couldn’t otherwise
afford it
Healthcare (prescriptions,
eyeglasses), utility programs
Creative distribution
systems, lower production
and marketing costs, high
operating efficiencies
Cooperative
Provides members with benefits
through collective services
Bulk purchasing, collective
bargaining (union),
agricultural coops, credit
unions
Members have common
interests/needs, are key
stakeholders, and investors
Market linkage
Facilitates trade relationships
between clients and the external
market
Import-export, market
research, and broker services
Does not sell clients’
products but connects
clients to markets
Service subsidization
Sells products or services to an
external market to help fund
other social programs. This
model is integrated with the non-
profit organization; the business
activities and social programs
overlap
Consulting, counseling,
employment training,
leasing, printing services,
and so forth
Can leverage tangible assets
(buildings, land, employees)
or intangible (expertise,
methodologies, or
relationships)
Organizational
support
Similar to service subsidization,
but applying the external model;
business activities are separate
from social programs
Similar to service
subsidization– implement
any type of business that
leverages its assets
Similar to service
subsidization
Taken from: Learn.MaRS Startup Toolkit (2020)
26
… the success of SEs´ business
models depends on their
environment and the support
received.
27
Also known as profit-with-purpose businesses, they are vital
entrepreneurial activities to achieve social goals.
2.6 Legal structures for SEs
An essential dimension of SEs is their legal framework. Indeed, existing
legal structures for for-profit and non-profit organizations are not always
appropriate for SEs. Thus, some countries introduced legal forms that
vary depending on the enterprise's mission.
Based on the Guide to Legal Forms for Social Enterprise (BIS) 2011 SEs’
legal form plays a vital role in defining three crucial aspects, i.e., their
social purpose, the targeted community or group of people, and their
stakeholders (BIS, 2011).
In this context, the four common legal forms of SEs are (European
Commission, 2020):
• Non-profits: This form includes associations, foundations, and
institutions which are applied in most European countries. They are
independent organizations, which profit mainly from funds and grants,
due to their charitable missions, whose fundamental principles are
democracy and equality between members.
• Cooperatives: This legal form promotes democracy among
members while focusing on meeting social needs without gaining profit.
Specifically, the profit from trading activities is distributed equally
between its members or re-invested in the enterprise.
• Social mission: In the different legal forms that various countries
have, the social mission can be stipulated in the acts of incorporation.
Due to the different legal frameworks between states, it is therefore
challenging to identify common characteristics of legal entities with a
social mission.
• Limited liability companies: SEs can be incorporated as limited
liability companies, also known as for-profit enterprises, where the
owners of the enterprise have shares. The shareholders of a SE can thus
invest and trade shares to gain profit in the name of social missions.
As mentioned, SEs’ legal form varies considerably based on national laws
and regulations. Countries such as Belgium, Denmark, Italy, and Finland
have established a special legal status for social enterprises, while in
Lithuania and Slovakia, this legal status is only obtained by organizations
that promote the employment of people with disabilities (European
Commission, 2020). Overall, there is a wide variety of legal forms of SEs
that produce social impact.
SEs’ legal form
varies
considerably
based on national
laws and
regulations
28
2.7 Conclusions
Shortcomings of the public and the private sector led to the creation of a third sector,
which aims at meeting the needs of social groups at risk of exclusion and living on the
margins due to social stratification inequalities. As mentioned, social economy focuses
on the collective action of delivering goods and/or services to vulnerable social groups
by fighting against social inequalities. The main fundamental principles of the third
sector are equality of opportunities, solidarity networks, collective action, and social
cohesion.
Moreover, social enterprises play a crucial role in the social economy because they
provide groups at risk of social exclusion with opportunities for collective benefit. SEs
differ significantly in each EU member state due to the different national laws and
regulations. Although there are various legal structures and models for SEs, social
entrepreneurship can provide people, especially vulnerable social groups, with the
opportunity to co-create with or become social entrepreneurs. The success of a social
enterprise depends on both its effectiveness and people’s active participation.
29
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Social Value Creation
Chapter 3
Photo by Alexander Grey on Unsplash
Sami Huohvanainen,
Metropolia University of Applied Sciences, Finland.
34
Chapter 3: Social Value Creation
Aim
The present chapter aims to familiarize readers with social value and social
value creation concepts. The reader will gain an understanding of the
relationship between economic value creation and social value creation.
Social value is a complex concept. It should be approached from a holistic
perspective that includes elements of social motives and mission, generating
impact on individuals and communities, and measurable goods such as jobs
and enhanced economics that benefit shareholders of social enterprises.
Expected Learning Outcomes
► To gain an understanding of the central concept related to social
value
► To gain knowledge of premises for social value creation
► To understand the different aspects of social value creation
► To understand the relationship between economic value, business
model, and social value
Keywords: Social Entrepreneurship, corporate social responsibility,
sustainability
3.1. Introduction
This chapter presents the concept of social value creation in the framework
of social entrepreneurship. Social entrepreneurship is centered around the
idea of social value creation (Singh, 2016). Social value creation is defined
differently in different contexts, and this chapter will present the most
relevant definitions. Value generation is at the very heart of any enterprise,
large or small, regardless of the business sector or industry (Beugré, 2016;
Singh, 2016). Economic value creation is widely researched and covered and
is fundamental for any business operational model (J. J. Roncancio et al.,
2021; Schmiedeknecht, 2020). Social entrepreneurship is a relatively narrow
field of research, but as a phenomenon, research and practice is trending and
growing (de Silva et al., 2021). Definitions of value creation come in many
forms; there are numerous other values than economic ones involved, and
multiple stakeholders benefit from other than economic value creation
(Doherty et al., 2014; Guerrero & Urbano, 2017).
“SE prioritizes the
achievement of
social goals”
35
3.2 Social Value Creation
Social value creation is central in the definition of SE. In this sense, Certo and
Miller (2008, p. 267) argue that “Social entrepreneurship involves the
recognition, evaluation, and exploitation of opportunities that result in social
value — the basic and long-standing needs of society”. On the other hand,
traditional business is based on profit and value creation in economic terms.
Social challenges are historically directed towards the public sector, typically
in the welfare states, third sector (e.g., Charities, NGOs), or communities that
have solved these challenges themselves. Regardless, funding of social
activities has been dependent on society's goodwill or philanthropy at some
level.
The driving force behind social enterprises is the urge to generate a change
of social, cultural, or natural value. This urge stems from people. There are
and always will be people with ideas for making the world a better place,
creating change, and trying to put these ideas into action. This process could
already be perceived as value creation. From the urge to the generation of
change, there is still a journey to create value. Quite often, the perceived
value is seen as a realized impact (Ormisto et al., 2011). SE aims to combine a
profit-based business model and solve social challenges. What is social value,
then? When discussing social value here - we talk about social as a whole -
societal structure.
Social value creation can be viewed from several perspectives. It may include
1) social, 2) natural, 3) cultural, or 4) creative value. It may serve the purpose
of 1) enhancing social cohesion and 2) creating solutions that improve social
or environmental development (Ormiston, Seymour, 2011). Social value
creation is widely understood as a benefit measured beyond economic value.
It can be a form of social capital, e.g., networks gained competence or
enhanced community cohesion (Di-Domenico et al., 2010, 682). Certo &
Miller (2008) define social value in this context as “...little to do with profits
but instead involves the fulfillment of basic and long-standing needs such as
providing food, water, shelter, education, and medical services to those
members of society who are in need.” (2008, p.267) and it can also refer to
enhanced economic circumstances, employment, and working conditions
(Beugré, 2016). In social ventures that operate in challenging operational
environments, successful companies can creatively combine resources that
are not otherwise available to address a social problem (Mair & Marti, 2006,
p.38). Value creation can also be perceived from different standpoints and
serves various purposes for other stakeholders. Therefore, a social value can
be understood also as a holistic mechanism, as the total impact of all the
stakeholders of an organization.
36
3.3 Premises and mechanisms of social
value creation
Social value is not explicitly a product of social enterprises since it may also
be included in the processes. For example, when an enterprise employs an
otherwise hardly employable workforce. As Ormiston and Seymour
underline, “the value creation can simultaneously refer to content and
process” (Ormiston & Seymour, 2011, p. 126)
Social value emerges from identifying social challenges and innovating
solutions. It may come from people that are strongly driven by a social
mission. It may also emerge from the community. To create social value and
combine it with commercial value creation, according to Beugre (2017),
social opportunities are needed as a basis for maximum social utility and
have five features as can be seen in Figure 3.1. as follows:
Figure 3.1. Social Opportunities features according to Beugre, 2017.
Researchers such as Beugre (2017) agree that social value creation and social
entrepreneurship emerge from social problems. These identified problems
may form a social opportunity. The opportunities may raise propositions and
initiatives for different solutions to a problem or enhance circumstances
around an issue. Some of these initiatives can be implemented
philanthropically, such as raising money or inviting people for community
work (Lumpkin et al., 2018; J. Roncancio et al., 2022). These activities create
social value and add value to divergent stakeholders. But suppose the
implementation involves a solution that relates to a direct business
opportunity, business model, or opportunity to run a business. In that case,
we are at the core of social entrepreneurship.
RadicalnessAccesibilityUrgencyRelevancePrevalence
37
3.4 Multiple value creation
Value creation can happen in various ways. Research by Dembek, York, and
Singh (2018) found a three-activity value creation model composed by (a)
delivering models which provide access to products and services to BoP (Base
of Pyramid) communities and (b) sourcing models which aim to source
materials, products, and services in communities and distribute them locally
or internationally. The third category includes (c) reorganizing models, which
aim to recreate or modify existing systems to benefit communities (Dembek
et al., 2018). Business model innovations are discussed in more detail in
section 3.6. At this point, it is important to conceptualize the different
approaches to social value creation and the multiple stakeholders of the
process.
3.5 Shared value and shareholders
There has been criticism towards the current capitalist approach of value
creation that emphasizes the short-term financial win at the expense of the
community (Porter et al., 2011). This progress has been confirmed to be non-
sustainable to any other than economic stakeholders. One solution that
might reconnect corporations and businesses with communities is the idea of
shared value, where economic and social/cultural value is connected. From a
corporation’s view, this doesn’t automatically mean that they would build
their business model on social value creation models but rather include social
value creation into their processes.
One way to look at value creation is from the stakeholder perspective
following Freudenreich et al. (2020) that presents a five-sector stakeholder
value framework: financial stakeholders, customers, business partners,
employees, and societal stakeholders. This model could be seen as different
from customer value proposition-centered models. Additionally, it highlights
the mutual character of relationships between stakeholders, where each
stakeholder is both a recipient and co-creator of value with a joint common
purpose (Freudenreich et al., 2020)
In this framework, the societal stakeholders are seen as significant
contributors to businesses, and businesses contribute back to societal
stakeholders. One way to interpret this relationship is to imagine what would
happen (and has happened) if the societal stakeholders were cut out as
contributors and value creators. Probably the corporation would neglect the
needs of society and communities and end up ignoring this sector of
stakeholders. Consequently, societal stakeholders would react and stop
contributing to the corporation by boycotting their products or demanding
stronger commitment toward their legal responsibilities.
Stakeholder group highlights the mutual character of relationships in which
stakeholders are both recipients and co-creators of value (Schaltegger and
38
Figge, 2000, cited in Freudenreuch et al. 2020). As a result, each dimension of
the framework relates to one stakeholder group.
3.6 Significance of networks
As said before, value creation is often considered a mutual benefit process
between stakeholders. In social entrepreneurship, the significance of
multiple stakeholders is more important than in traditional business.
Networks are also a valuable and measurable asset for any entrepreneurship,
both in economic and social sense. Networks are significant resources for any
value creation and social entrepreneurs can mobilize networks effectively
(Ormiston, Seymour, 2011).
3.7 Combining social value with
business opportunity
Domenico et al. (2010) that social enterprises emerge from limited access to
resources and as a response to these limitations (2010, p. 683). They also
suggest a theory of social bricolage, which includes entrepreneurship with
limited resources, refusal to enact limitations, and improvisation. In this
theory, a suitable business model is an answer to limitations.
3.8 Social value concept in Finland
Historically, Finland, and likewise other Sweden and Denmark, had a
prominent welfare state. Most social needs have been covered by services
organized by the state or municipality according to law and statutes. This
model was developed during the 20th century. This model has fewer “blind
spots” for social needs and thus less demand for social enterprises. In the last
3-4 decades, there has been a lot of structural change, due to age
dependency, high costs of welfare state bureaucracy, and employment
challenges. For these reasons, the social enterprise sector is growing, and its
role was acknowledged in recent government programs.
However, the Finnish social enterprise focuses mainly on employment,
significantly enhancing it amongst long-term unemployed or those otherwise
in difficult labor market positions. Other social aspects are recognized, but
resources focus on employment. The Association of Finnish Work grants the
Social Enterprise Mark to Finnish enterprises based on particular terms and
rules. In addition to general rules and conditions to achieve this mark, several
criteria are under the eligibility section. The first and foremost criterion
states that “The primary purpose and objective of the social enterprise is to
39
contribute to social good. The social enterprise is engaged in responsible
business activities.” (www.suomalainentyo.fi) Although the term “social
good” can be understood very broadly, it is clear that “contributing to social
good” suggests social value creation. Among the secondary criteria, the
association asks s candidates to “measuring of social effectiveness and the
generated social impact.”
One example of combining the welfare state and social enterprise is the
Finnish gaming company Veikkaus. It is a 100% state-owned company that
organizes gaming and gambling in Finland. It holds the exclusive right to
operate all gambling in Finland, which means a solid national monopoly. Its
profits are steered to various fields of society, eg. culture, sports, science,
and social welfare. The support from Veikkaus’ funding is the base for
numerous social projects and NGOs that work closely with government and
municipalities. The revenue of Veikkaus is thirteen billion euros with a profit
of three billion. In recent years there has been some vocal criticism towards
Veikkaus. It has been shown that it gathers its revenue by exploiting people's
addiction to gambling, and only 5% of all gamblers are responsible for 50% of
the revenue. Other examples are trust-funded amusement park Linnanmäki,
which guides its profit for the benefit of children. The Deaconess Foundation
is also trust-based, and it operates in several fields of the welfare sector and
owns two educational institutes.
3.9 Activity 1
Choose a community familiar to you (e.g., your region, town, neighborhood,
student community, etc.), and think about any potential social challenges
they face. What improvements could be made, and how could a social
impact be created? What would be the desired impact(s)? List these things
(2-4). Subsequently, draw a mind-map around each desired impact and
identify and visualize all potential shareholders benefitting from these social
developments.
3.10 Conclusions
Overall, social value is a primarily studied but still undefined concept. It can
be described beyond economic value, although an economic enhancement in
impoverished environments also improves the social milieu. Social value
creation is embedded in the core mission of social enterprises. The motives
and incentives for social change can be traced back to the social
entrepreneurs who aim for change in their local community and society.
Networks are one form of social value. Social enterprises are typically more
40
effective than their commercial counterparts in mobilizing networks and
finding their potential and resources (Outsios and Kittler, 2018).
References
Beugré, C. (2016). Social Entrepreneurship: Managing the creation of social
value. In Social Entrepreneurship. Routledge.
https://doi.org/10.4324/9780203442609
Beugre C. (2017) Social entrepreneurship: managing the creation of social
value, New York, Routledge
Certo S. T., Miller T. (2008) Social entrepreneurship: Key issues and concepts,
Business Horizons 51, p 267-271
De Silva, M., Gokhberg, L., Meissner, D., & Russo, M. (2021). Addressing
societal challenges through the simultaneous generation of social and
business values: A conceptual framework for science-based co-creation.
Technovation, 104(March), 102268.
https://doi.org/10.1016/j.technovation.2021.102268
Dembek K., York J., Singh P. (2018), Creating value for multiple stakeholders:
Sustainable business models at the Base of the Pyramid, Journal of Cleaner
Production 196, p. 1600-1612
Di-Domenico M., Tracey H., (2010) Social Bricolage: Theorizing Social Value
Creation in Social Enterprises, Baylor University
Doherty, B., Haugh, H., & Lyon, F. (2014). Social Enterprises as Hybrid
Organizations: A Review and Research Agenda. International Journal of
Management Reviews, 16(4), 417–436. https://doi.org/10.1111/ijmr.12028
Freudenreich B., Lüdeke‑Freund F., Schaltegger S (2020) A Stakeholder
Theory Perspective on Business Models: Value Creation for Sustainability,
Journal of Business Ethics 166, p. 3–18
Guerrero, M., & Urbano, D. (2017). The impact of Triple Helix agents on
entrepreneurial innovations’ performance : An inside look at enterprises
located in an emerging economy. Technological Forecasting & Social Change,
119, 294–309. https://doi.org/10.1016/j.techfore.2016.06.015
Lumpkin, G. T., Bacq, S., & Pidduck, R. J. (2018). Where Change Happens:
Community-Level Phenomena in Social Entrepreneurship Research. Journal
of Small Business Management, 56(1), 24–50.
https://doi.org/10.1111/jsbm.12379
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Mair J, Marti I. (2006) Social entrepreneurship research: A source of
explanation, prediction, and delight, Journal of World Business 41, p36–44
Ormiston S., Seymour R. (2011) Understanding Value Creation in Social
Entrepreneurship: The Importance of Aligning Mission, Strategy and Impact
Measurement, Journal of Social Entrepreneurship, 2:2, 125-150
Outsios, G., & Kittler, M. (2018). The mindset of UK environmental
entrepreneurs: A habitus perspective. International Small Business Journal,
36(3), 285-306.
Porter M., Kramer M., (2011) Creating Shared Value How to reinvent
capitalism — and unleash a wave of innovation and growth, Harvard Business
Review, January-February 2011
Roncancio, J. J., Dentchev, N. A., Guerrero, M., & Diaz Gonzalez, A. (2021).
Non-commercial academic entrepreneurship: The influence of human capital
in social value creation. Academy of Management Proceedings, 2021(1),
15843. https://doi.org/10.5465/ambpp.2021.15843abstract
Roncancio, J., Dentchev, N. A., Guerrero, M., & Diaz-Gonzalez, A. A. (2022).
Shaping the social orientation of academic entrepreneurship: an exploratory
study. International Journal of Entrepreneurial Behavior & Research.
https://doi.org/10.1108/IJEBR-07-2021-0600
Schaltegger, S., & Figge, F. (2000). Environmental shareholder value:
economic success with corporate environmental management. Eco‐
Management and Auditing: The Journal of Corporate Environmental
Management, 7(1), 29-42.
Schmiedeknecht, M. H. (2020). Social Innovation and Entrepreneurship
Supporting the Sustainable Development Goals (SDGs)–Fostering Social Value
Creation. 211–225. https://doi.org/10.1007/978-3-030-21154-7_10
Singh, A. (2016). The Process of Social Value Creation.
https://doi.org/10.1007/978-81-322-2827-1
Websites: https://suomalainentyo.fi/en/services/finnish-social-
enterprise/rules/
42
Challenges in Social
Entrepreneurship
Chapter 4
Photo by Tim Collins on Unsplash
Iliya Kereziev1, Diana Kopeva1,
1University of National and World Economy, Bulgaria.
43
Chapter 4: Challenges in Social
Entrepreneurship
Aim
This chapter aims to present the challenges faced by traditional
entrepreneurs, particularly social entrepreneurs. These obstacles to
entrepreneurship are compared between traditional and social
entrepreneurs. The chapter presents strategies that social entrepreneurs
use to overcome challenges and explains how to implement them.
Expected Learning Outcomes
► Understand the challenges confronting entrepreneurs.
► Understand the specific challenges faced by social
entrepreneurs.
► Insights into strategies most used by social entrepreneurs to
overcome their challenges.
► Develop insights into the significant implications of the
strategies used to overcome the challenges of social
entrepreneurs.
Keywords: Challenges Faced by Entrepreneurs, Specific Challenges of
Social Entrepreneurs, Strategies for Overcoming Challenges of Social
Entrepreneurs.
4.1. Introduction
The number of social entrepreneurs has grown significantly in recent
decades worldwide (Ebrahimet al., 2014). They have attracted public
interest with their ability to successfully address social problems and
provide innovative approaches to social issues. However, it became clear
that social entrepreneurs face challenges that impede the scalability of
their social ventures. And this hinders their ability to deliver social value.
Generally, social entrepreneurs face similar challenges as traditional
entrepreneurs, and on top of those, they have specific challenges faced
by social SMEs. In addition to the economic aspects, social
entrepreneurship aims to solve social problems or establish social
change. The goal of social entrepreneurship is not only to maximize
profits but to solve social problems. This adds a new goal and poses new
challenges for social entrepreneurs.
“The number of
social
entrepreneurs has
grown
significantly in
recent decades
worldwide”
44
4.2. Typical challenges of an entrepreneur
In the scientific literature, various researchers of the domain of
entrepreneurship unite around the following typical challenges faced by
entrepreneurs:
A) Access to venture capital and securing business financing – access to venture
capital is limited. Many entrepreneurs cannot meet the requirements of credit
institutions. They have no credit history and cannot provide the necessary
evidence for their liability. Social entrepreneurs report limited access to
sustainable financial resources despite existing programs and financial schemes.
It is difficult to access finance because credit institutions still focus on viability
and efficiency and underestimate the social aspect of business and its potential
for social impact generation (Kittler et al., 2018).
“Many entrepreneurs cannot meet the
requirements of credit institutions. They have no
credit history and cannot provide the necessary
evidence for their liability”
B) Marketing – establishing channels for the sale of products and overcoming
the dominant positions of large businesses. The duality of nature (economic and
social) makes competition difficult for social entrepreneurs. They must acquire
and keep a marketing segment where they are competing with other players.
C) Overcoming dependence on a small number of customers – the duality of
business objectives and having social goals shrink the number of customers. This
leads to a different net cash flow compared to regular business. The income
flow of social enterprises is oppressed due to the limited number of clients.
D) Building a working team – the representatives of an SME should be able to
build a team of experts who can meet the venture's needs and contribute to
creating conditions for sustainability and the competitiveness of the business.
E) Introduction of innovations –entrepreneurial ventures are primarily small,
without formal business units to analyze the latest innovative solutions or
research and development. They do not have the financial resources to lead
innovation, which makes them less competitive.
F) Finding, retaining, and increasing the share of customers –start-ups have a
limited number of customers. Therefore, it is necessary to apply different
strategies to attract and retain customers. Unlike large companies, start-ups
cannot spend much money on strategic actions like advertising or price
differentiation strategies.
45
G) Business management, business planning, and financial management skills –
most entrepreneurs do not have knowledge or experience in the field of
business. Limited competencies are a prerequisite for shocks and instability in
their business development. Therefore, entrepreneurs apply a trial-and-error
approach to acquire these skills.
H) Overcoming social stereotypes related to age, gender, sector, location, etc. -
entrepreneurs face several prejudices and stereotypes. Young entrepreneurs
should break the established pattern that only after gaining life and professional
experience can they successfully start a business. Women, LGBTQ+, and
immigrant entrepreneurs face stereotypes while developing a successful
business.
4.3 Challenges faced by social
entrepreneurs
Social entrepreneurs face multiple issues in creating social impact and delivering
social value in addition to business value. The duality of their mission is a unique
and overarching challenge. Pursuing two different goals may lead to mission
drift. For example, on many occasions, social enterprises have been criticized for
prioritizing financial gains at the expense of their social mission. Social
enterprises usually have accountability to multiple principal stakeholders
because of their social aspirations. Beyond addressing the needs of their
customers, owners, investors, and local community, social enterprises must do
the same for their beneficiaries, volunteers, donors, community partners, and
other specific groups of stakeholders. According to Ebrahim et al. (2014), social
enterprises must combine their conflicting social and financial goals and
divergent stakeholder interests.
Financing is the most significant barrier to starting and growing a social
enterprise (Kittler and Outsios, 2014). Especially in the case of early-stage social
entrepreneurs and social ventures which are not financially self-sustainable,
funding and investments continue to be one of the biggest challenges. Still,
most social entrepreneurs are commonly financed by foundations,
philanthropists, or public organizations whose typical support is modest in size
and relatively short-term. Moreover, public funding is difficult with lengthy
procedures and complicated bureaucracy (Abramson and Billings, 2019). On the
other hand, convincing conventional investors to invest in social enterprises and
not in other competing entrepreneurs is difficult. Traditional investors are
skeptical of the return on the investment potential of social enterprises (Dees
et al., 2008). Approaching investors may not be accessible if the organization is
not likely to make a reasonable return for investors within a five to seven years
period. And it does not help that social and financial markets in many countries
46
are fragmented, underdeveloped, and insignificant compared to mainstream
capital markets (Dees et al., 2008).
Like their commercial counterparts, social entrepreneurs also face the
challenges of managing human resources effectively. Nevertheless, for social
enterprises, this is even more complex. Recruiting and retaining a good
workforce is difficult because social entrepreneurs are rarely able to pay their
employees a salary at market rates, especially for key employees. Elkington and
Hartigan (2008) note that there is a significant salary gap between traditional
and social enterprises, and this limits the capacity of social enterprises to
expand their operations and achieve financial sustainability. Generally, young
talented individuals prefer attractive pay packages and stable jobs from large
enterprises, and very few are ready to join a social enterprise. Thus, social
businesses struggle to maintain qualified and committed employees. On the
other hand, relying on volunteers is a viable alternative, but this poses other
disadvantages.
Another common challenge is dealing with public distrust of charity and social
goals and investing in company profits to solve social problems. Social
entrepreneurs are often questioned because their intentions are misunderstood
and largely ignored by society, the business sector, and public institutions. Some
must deal with various societal groups and activists who do not necessarily
agree with their social mission. Furthermore, donors can distrust a social
enterprise that focuses too much on wealth generation and too little on social
value. Overcoming this mistrust will increase the number of customers and the
generated profit, and finally, a faster and more effective solution to the social
problem.
The obstacles mentioned above lead to other common problems faced by social
entrepreneurs. This can be related to the capacity for growth and scalability of
their operations. The scalability of social ventures has two interrelated aspects,
one is regarding the scale of impact and the other is the organizational growth.
One of the challenges for social entrepreneurs is that the demand for social
products and services usually exceeds their initial capacity. The pressure for
rapid growth and the increasing demand for the product and services may
adversely impact the key underlying goal of creating a social impact. On the
other hand, there are multiple constraints that limit the ability of a social
enterprise to expand, like supply chain limitations, restraining government
policies, or lack of partnerships. In addition, Dees et al. (2008) notes that social
impact foundations are prone to funding new ventures but are less interested in
helping them scale.
A unique challenge in the context of social entrepreneurship is the need for
measuring social impact. Both private and public financing organizations have
increasingly demanded that organizations measure their impact. However,
many social benefits and improvements that social entrepreneurs provide are
not tangible, quantifiable, or measurable (Zahra et al., 2009). Even when output
47
and impact can be measured, attributing them to a specific intervention or
social enterprise is often difficult. Causality and comparability remain
problematic in social impact assessment because outcomes and impacts
frequently depend on factors beyond the control of social enterprise (Ebrahim,
et al., 2014). Only limited organizations can afford complex measurement
methodologies that prove the causal link between an intervention and its
impact. The difficulties related to measuring social enterprise’s impact further
complicate their relationship with financers. Impact investors seek evidence that
their investment in the social entrepreneur will be effective in social change.
4.4 Strategies used by social entrepreneurs
to overcome their challenges
There is no universal solution to the challenges discussed above, but social
entrepreneurs apply a range of strategies that can address specific problems.
Social enterprises can diversify their income sources and build collaborations
with complementary or supportive organizations. But then, these organizations
become critical for the development and survival of the social enterprise.
Collaborations and networking opportunities in different spheres of action get
social entrepreneurs in touch with the latest information and access to new
markets and clients. By recruiting relevant stakeholders' support, social
entrepreneurs get access to new sources of financing and support (Hynes,
2009).
Social enterprises have coping mechanisms to accomplish both entrepreneurial
and social objectives. These include the development of partnerships with
complementary organizations, building an interdisciplinary professional staff,
mobilizing resources, and generating income from diverse sources (Hynes,
2009). Another strategy is the integration of social and economic activities, so
social entrepreneurs automatically focus on both. Social entrepreneurs can also
manage these separately by compressing these functions and managing these
goals separately (Battilana and Lee, 2014). Battilana et al. (2019) suggest that
dual-minded leadership can make strategic decisions that embody social and
economic goals. Through communication, training, promotion, incentive
systems, and job shadowing, Employees are socialized to embrace social and
economic perspectives.
Social enterprises face various obstacles in managing their venture, particularly
resource acquisition, processes like mobilization of financial and human
resources. In this respect, it is important for social enterprises to deploy
resources from different and multiple sources. Social entrepreneurs have the
option to use specific processes such as passion and commitment to the cause
to leverage human and financial resources (Murphy and Coombes 2009). Social
enterprises rely on volunteers who are willing to contribute to achieve the
organization's social mission.
48
Social entrepreneurs should understand the motivations of their investors. For
example, if social enterprises deal with conventional investors, it is essential to
emphasize the profitability perspective of an intervention instead of focusing on
its social impact. When engaging with impact investors, social enterprises
should focus on social returns and the need for financial sustainability.
Successful social entrepreneurs tend to specialize in engaging with funding
sources primarily interested in creating social value. Social entrepreneurs utilize
the duality of their organizational mission to gain legitimacy. Their double
mission opens opportunities to mobilize resources from stakeholders with a
social agenda and enables them to provide public services and get contracts
with public donors and government institutions (Doherty et al., 2009; Bridgstock
et al., 2010).
Social entrepreneurs can apply different strategies for growth and scaling their
social impact. The Key is finding the appropriate organizational size and the right
approach to expand rather than pursuing growth for the sake of growth. Social
entrepreneurs often do not apply competitive procedures to manage their
growth process but cooperative activities. Social entrepreneurs typically use one
or more of the following growth strategies (Beugre, 2017):
► Capacity building through the development of internal capabilities and
strengthening essential skills, for example, revising the organizational
mission to acquire better equipment and more skillful employees.
► Dissemination of products or services. The dissemination growth
strategy is like the diffusion of innovation. It entails actively providing
information and technical assistance to others who wish to bring social
innovation to their community.
► Branching and affiliation. Social entrepreneurs can scale their social
ventures by using branching as a growth strategy. The branches have
little autonomy since critical decisions are made at the headquarters.
Affiliation is like branching as the social venture establishes units in
other locations. As opposed to branches, affiliates have more
autonomy, and they are embedded in the communities where they
operate.
► Social franchising. Social franchising is a hybrid growth strategy
combining branching and affiliation elements. It entails replication of
the business model to other national or international regions.
► Strategic alliances. Some social enterprises use strategic alliances to
scale their operations. Such partnerships can take various forms, such as
collaboration with other social ventures and actors in the private,
public, or civil sectors. These partnerships allow them to develop
processes, products, and services, engage the entrepreneurial network,
or gain access to knowledge, skills, infrastructure, and capital.
► To some extent, the above strategies are similar to those used by
commercial ventures. In addition, other specific approaches used by
social enterprises to scale their impact can be identified:
49
► Build a movement by spreading the core idea and principles. Get
governments, mainstream businesses, local communities, or other
entrepreneurs on board to work in support of the same purpose.
► Sell a part of or the entire social venture to a commercial business to
increase the knowledge and impact of the concept and eventually make
the social mission mainstream.
All discussed strategies and approaches can be found in Figure 4.1. and require
developing a commercially viable product or service. Usually, customers will not
buy products or services only to support a cause. The quality of the product or
service is crucial to ensure sustainable growth of the social enterprise.
Figure 4.1. Growth strategies used by social entrepreneurs according to Beugre, 2017.
Capacity
Building
Branching
Strategic
Alliances
Social
Franchising
Dissemination
of products or
services
50
One of the biggest challenges of social entrepreneurs is convincing
stakeholders and local communities to trust them and support their cause.
For that reason, social entrepreneurs need to communicate social
problems and the solution. Social entrepreneurs can engage supporters
easier when they can show how their social venture is part of a solution. It
is essential to increase the social enterprise’s visibility to the public and
show its social impact.
Social enterprises have found ways to address the difficulties around
measuring their social impact. Battilana et al. (2019) note that social
ventures should develop a manageable number of trackable metrics
during the goal-setting process. And revisit these metrics to assess their
continuing relevance and adequacy. Social entrepreneurs face obstacles in
choosing the best method that suits their organization, even dough many
methodologies and tools for measuring social impact exist. Most social
enterprises lack knowledge, competencies, resources, and time for impact
assessment. And as a result, many social enterprises are trying to design
their assessment approaches in collaboration with their key stakeholders.
These impact assessments follow their specific requirements and are
usually based on the theory of change.
Photo by Kristopher Roller on Unsplash
51
4.5 Conclusions
Creating sustainable social enterprises requires both the creative combination and
adaptation of social and commercial approaches. But also, the development of new
conceptual frameworks and strategies tailored specifically to social
entrepreneurship. Therefore, successful social entrepreneurship requires an in-
depth understanding of the specific context in which it is located. Social
entrepreneurs need support in overcoming obstacles to accelerate social value
creation. The public policy and the broader supportive infrastructure being
developed for social enterprises should be aimed at overcoming the challenges the
field faces.
52
References
Alan J. Abramson and Kara C. Billings. (2019). Challenges Facing Social Enterprises in the
United States. De Gruyter, Published online: May 14, 2019.
Battilana, J., A. Pache, M. Sengul, and M. Kimsey. (2019). “The Dual-Purpose Playbook:
What It Takes to Do Well and Do Good at the Same Time.” Harvard Business Review 97
(2): 124–33.
Battilana, J., Lee, M. (2014), Advancing research on hybrid organizing insights from the
study of social enterprises, The Academy of Management Annals, 8(1): 397-441.
Beugre, C., (2017). Social Entrepreneurship: Managing the Creation of Social Value, NY:
Routledge.
Bridgstock, R., Lettice, F., Özbilgin, M.F., Tatli, A. (2010), Diversity management for
innovation in social enterprises in the UK, Entrepreneurship and Regional Development,
22(6): 557-574.
Dees, J. G., M. Nash, B. Anderson, J. Kalafatas, R. Tolman, W. Kuran, and P. Bloom.
(2008). “Developing the Field of Social Entrepreneurship.” Center for the Advancement
of Social Entrepreneurship, Duke University. Accessed May 12, 2021,
https://community-wealth.org/sites/clone.community-
wealth.org/files/downloads/paper-case.pdf.
Doherty, B., et al. (2009). Management for Social Enterprise. London: Sage Publications.
Ebrahim, A., J. Battilana, and J. Mair. (2014). “The Governance of Social Enterprises:
Mission Drift and Accountability Challenges in Hybrid Organizations.” Research in
Organizational Behavior, Vol. 34, 2014, https://doi.org/10.1016/j.riob.2014.09.001.
Elkington, J., & Hartigan, P. (2008). The power of unreasonable people: how social
entrepreneurs create markets that change the world. Boston, Mass.: Harvard Business
School Press.
Hynes, B. (2009). Growing the social enterprise – issues and challenges. Social Enterprise
Journal 5(2): 114–125.
Murphy, P. J., & Coombes, S. M. (2009). A model of social entrepreneurial discovery.
Journal of business ethics, 87(3), 325-336.
Outsios, G., & Kittler, M. (2018). The mindset of UK environmental entrepreneurs: A
habitus perspective. International Small Business Journal, 36(3), 285-306.
Social Impact Investment Taskforce. (2014). “Impact Investment: The Invisible Heart of
Markets.” Accessed March 17, 2021.
http://www.ietp.com/sites/default/files/Impact%20Investment%20Report%20FINAL.pd
f
Zahra, S., A., et al. (2009). A typology of social enterprise: motives, search processes and
ethical challenges. Journal of Business Venturing 24: 519–532.
53
Business Model
Development for Social
Enterprises
Chapter 5
Photo by Olav Ahrens Røtne on Unsplash
Eliana Vassiliou,
Entrepreneurship and Social Economy Group (EKO), Greece.
EKO
54
Chapter 5: Business Model Development
for Social Enterprises
Aim
In this chapter, we enable readers to familiarize themselves with basic
concepts related to a business model for a social enterprise. Upon reading
this chapter, students will become acquainted with the basic principles of a
business model for SEs, recognizing how discrete contexts may affect its
planning, embracing the procedure of evolving it, and understanding the
notion of the social project chance recognition.
The first section presents the vital components and the main format of a
business plan. It also describes the various types of business models
according to the multiple forms a social enterprise can take. The second
section highlights how different socioeconomic contexts may affect the
development of a SEs business model. The third section analyzes the basic
framework of a SEs business model’s development. The last section identifies
the circumstances that play a central role in recognizing opportunities for a
social venture.
Expected Learning Outcomes
► Understand and master the basic concepts of a business model for
Social Business.
► Get acquainted with the several types of SEs Business Models.
► Comprehend the ways a business model may be differentiated
depending on the context.
► Elaborate on an SEs business plan.
► Clarify how a social entrepreneur may diagnose an opportunity to
undertake a social venture.
Keywords: Business Model, Social Enterprise, Social Venture, Opportunity
Identification.
5.1. Introduction
Many different sectors are paying growing attention to the field of social
entrepreneurship, while it remains a promising market approach to various
societal needs and challenges. Through social entrepreneurship, a range of
“The elaboration of a
functional and
efficient business
plan constitutes the
biggest and most
common challenge
an entrepreneur
faces nowadays”
55
socially beneficial activities can be transformed into self-sustainable and
viable initiatives.
Joseph Schumpeter’s approach (1975) to entrepreneurship, linking it with the
concept of value creation, is widely extended in social entrepreneurship; that
is, to use value creation to achieve the parallel creation of social value,
attributing to social change. This chapter focuses precisely on this process,
namely the structural approach to value creation that would lead to social
impact. The following analysis of business model development for Social
Enterprises will allow students to recognize the core elements of a respective
business model and to understand the different needs in different contexts.
Also, it will enable them to acquire helpful knowledge for their future
enterprises.
To achieve that, the following chapter first discusses the major elements of
an SE, highlighting the framework that allows such an enterprise to produce
social value while reassuring its financial viability. Then, it focuses on the
different needs that an SE should address, according to the conjuncture, and
it provides several guidelines and mentions various tools for its development.
Lastly, it describes the different motives and circumstances for identifying an
SE opportunity, also underlining the differences between a typical business
opportunity and one in the field of social entrepreneurship.
5.2 Key elements of the social enterprise
Business Models
The elaboration of a functional and efficient business plan constitutes the
biggest and most common challenge an entrepreneur faces nowadays.
Before defining the key elements of the Social Enterprise (SE) Business
Model, it is necessary to comprehensively analyze the differences between a
typical business plan and a social enterprise plan.
According to Aziz Ullah’s article, “Important elements of business model &
plan for social enterprise and nonprofits”, in Atlas Corps, “A Business Plan is a
roadmap for achieving organizational growth”, a business plan defines the
key methods an enterprise should adopt to benefit its customers and clients.
When it comes to a social enterprise, the social impact should be added to
the plan as a necessary parameter of its roadmap (Sommerrock, 2010b,
2010a). A social enterprise model provides a framework that enables the
social entrepreneur to achieve a financially viable development of his/her
venture in addition to social value.
Business plans reflect on how a business should function (Magretta, 2014). A
social enterprise needs to achieve both sustainability and social impact.
While elaborating on its business plan, the following essential elements
should be considered as shown in Figure 5.1:
56
Figure 5.1. Essential elements of a business plan for SEs. Source, the authors,
following Magretta (2014) and Sommerrock (2010;2014).
Additionally, it is important to consider the following elements when writing
a business plan for a SE:
Executive Summary
The Executive Summary includes the basic features of a plan which enables a
reader to comprehend the endeavor and to support it without necessarily
getting into the details of the concept. It is a chance to make the initial pitch
for a social business concept (Germak, 2013). The Executive Summary is the
last part to be developed, and its length does not usually exceed two pages.
Business Description
The Business Description describes the objectives of a social endeavor and
presents its products /services as well as the added value a potential
customer/beneficiary will gain from the social enterprise operation. The
enterprise’s organization, its operational procedures, the “strategic
relationships" and the enterprise’s legal structure are examined here.
Mission Statement
The Mission Statement refers to the social value the social entrepreneur
intends to offer to society. Within the crucial elements of the mission
statement are the accomplishment of both financial and social goals as well
Essential
Elements of a
Business plan
for SEs
Executive
Summary
Mission
Statement
Board and
Workforce
Market
Exploration
Financial
Planning
Business
Description
57
as the combination of the business function with the social mission
(Neumeyer & Santos, 2017; Sommerrock, 2010a).
Board and Workforce
This part clarifies how the business expertise of the enterprise’s board and
personnel will support the accomplishment of its goals.
Market/Social Milieu Analysis and Identification
This section analyzes the potential customers/beneficiaries/stakeholders, the
types of products/services to deliver, the fees/ cost of the products/services
for the beneficiaries. Consistent research is required to specify the targeted
beneficiaries’ needs, align the enterprise’s goals with the needs of the
specific social environment and overcome the competition. This analysis
allows the plan of action, on the one hand, to address efficiently the target
groups the enterprise wishes to be associated with; on the other, to align
with the enterprise’s whole strategy.
Financial Planning
The Financial Plan constitutes an essential part of the Business Plan since it
offers the social entrepreneur the chance to pursue his goals resiliently and
qualitatively. It analyses various elements such as start-up expenditures,
expected revenues and profits, and financial records for at least three years.
It assures investors that both the enterprise's economic and social objectives
can be securely attained and that its financial development can be achieved
through its funding (Neumeyer & Santos, 2017; Sommerrock, 2010a).
Types of Social Business Models
Several types of SEs Business Models are analyzed in literature based on how
they work, their key success factors, sustainability, and social impact. One
can find an interesting visualization of the leading business models presented
in the literature in a table used by different scholars in the field, which allows
the comparison of their similar and additional features as can be seen in
Figure 5.2.
58
Figure 5.2. Types of Social Business Models
5.3 How does the Business Model of SEs
Vary According to their Context?
Social enterprises engage in commercial activities to achieve social missions
with the overall scope to generate social value and spread it (spillover effect).
SEs use their profits to reinforce social benefits according to their company’s
strategy. Long-term they manage to produce social change, but they are also
extremely fragile with financing and economics. SEs need different
managerial strategies that can balance social value and commercial success.
Social value can be succeeded through commercial value. Usually, these
companies provide a product that is deeply needed. As customers consume it
willingly, they see their lives changing and here is where social value is being
created. SEs vary depending on the division between beneficiaries and
customers:
Market Hybrid SEs
In this type of SEs beneficiaries are also customers who pay the product
price. Social value spreads automatically. For instance, an organization in
India makes menstrual products for women. In India only 10% of women can
afford such products. This small entity makes cheap products and firstly sells
them to women who take part in the production of the products. Low costs
Entrepreneurs
support
Market
intermediary
Employment Free-
for-
service
Low-
income
client
Cooperative Market
linkage
Service
subsidization
Organizational
support
59
create big social spillovers as an increasing number of women have access to
such products and see their lives improve.
Blending Hybrid SEs
Beneficiaries are once again customers, but the activities of the company
should be carefully designed to produce social results. For example, in
developing countries, lending money is extremely difficult. A microfinance
institution that lends money to young entrepreneurs could boost the
economy and create a dynamic socio-economic context. Lending companies
should be careful though as borrowed capital may end up in controversial
markets (e.g., gambling) and compromise the initiative’s social impact.
Bridging Hybrid SEs
Beneficiaries and customers are two distinct stakeholders; companies must
bridge the distance between them. For instance, a coffee company (e.g.,
Brownies & Downies) in the Netherlands provides people with Down
syndrome with job opportunities, letting them run and manage the coffee
shops. In the meantime, the stores must service customers unaware of
various backgrounds.
Coupling Hybrid SEs
In this model different beneficiaries and customers are difficult to combine.
Such enterprises need specific actions to become socially and economically
sustainable. They have to combine clearly social activities with commercial
ones and for them it is usually a significant challenge to balance financially.
Therefore, they may find sponsors from the third sector, the public or private
organizations.
Common problems SEs face:
► Absence of buying potential from the targeted customers
If customers cannot consume the product in the first place, it is impossible to
create social value. In this case, companies should rebuild their value chain to
respond to customers buying ability.
60
► Inaccessible products
Rural areas usually face challenges in gaining access to pioneering products.
Companies should collaborate with local shops or other stakeholders to
ensure that their product and service ranges are accessible.
► Mismatch of price and product
In some cases, customers do not recognize the value of a product compared
to its relevant marketed price and remain unwilling to pay it. Marketing
strategists can resolve such problems with targeted campaigns.
5.4 Main stages in the elaboration and
implementation of a social business
model
At the first stage of planning, it is essential to emphasize the significance of
elaborating a detailed business model which will assist the potential social
entrepreneur in focusing on the specific business’ crucial parameters and
vital aims. While developing a social business model, they are expected to
find a procedure to escalate the business plan to a fruitful entrepreneurial
project successfully.
A social entrepreneur has to face his business growth as a dynamic process to
respond to critical challenges of a social venture and clearly determine the
social and financial objectives he/she has to achieve (ENP, 2010). Thus, the
social entrepreneur must keep collecting, assessing, and re-evaluating the
parameters, tools and methods of his business development and operation
(Gundry et al., 2015; Williams & Nadin, 2012).
In this context, a social enterprise is differentiated from a traditional one by
the need to identify its specific requirements, ensure its viability, and
emphasize and reinforce its social impact. Thus, while developing a “Social
Business Model Canvas”, it is necessary to define and illustrate the
enterprise’s social objectives and accompany them with a precise
sustainability plan.
The above requirement is fundamental to achieve, on the one hand, the
establishment of an economically viable business model, on the other, a
comprehensive social mission and carefully picture both parts: on the one
hand, to ensure a sustainable business scheme, on the other to secure its
social impact; their interaction constitutes the most vital factor of a business
plan’s functionality (Knode, 2016).
61
Dentchev (2020) argues that Inclusivity refers to poor people and all kinds of
excluded individuals. Inclusive Business Models (IBM) and other alternative
business models aim to cope with these issues and create inclusive and
modern environments. IBMs include:
► Fair trade businesses: Companies that support fair prices for
producers, especially in poorer areas, or collaboration with smaller
stakeholders.
► Integration of disabled individuals: work integration of these
individuals is an important step towards social inclusion. Companies
should provide all facilities for disabled employees.
► Social entrepreneurship combines solid social practices within the
company and business-oriented innovation. Such companies give
importance to a viable working environment.
► IBMs + Ecosystems: For IBMs to be sustainable, they are part of a
larger ecosystem with other businesses and stakeholders that share
information and sources.
Except for IBMs, there are also Sustainable Businesses that focus on
environmental practices and aim to function with environmentally friendly
methods. Also, Base of Pyramid companies collaborate with other
communities to create efficient products that respond precisely to
customers' needs. Usually, these companies face difficulties as they do not
know the market well and cannot merchandise their product quickly.
Co-creation is also an innovative and inclusive business structure where
companies collaborate with local citizens to penetrate a new market. Such
examples include big companies penetrating developing countries. These
companies do not have
knowledge of the entering market; thus, they must collaborate with local
stakeholders to produce efficient products and reduce risks and costs.
Meanwhile, companies gain essential knowledge of the market that can be
used in the future (Nahi, 2016).
A “Social Business Canvas” facilitates the design and development of a social
enterprise framework and is based on various components interacting with
each other.
The existing literature in the field illustrates many of these components
which should be considered for a successful elaboration of a social business
plan. Some basic ones are the following:
62
Channels
Channels illustrate the manner a company interacts with and approaches its
clients, its beneficiaries, and the way it distributes value (Sparviero, 2019). It
is important to concentrate on channels that are expected to create profit
(Propel Nonprofits, 2022) considering that efficient channels will disseminate
a business’ value proposal promptly, effectively, and profitably (Osterwalder
and Pigneur, 2010). Channels may be direct and indirect. With direct
channels companies reach customers directly through web sales or own
stores, whereas with indirect channels companies collaborate with third
party companies (Osterwalder and Pigneur, 2010).
Partners and Key Stakeholders
They refer to key groups essential for the accomplishment of the venture’s
set goals. It is important to define, select and approach both its basic
partners/stakeholders and its basic suppliers and determine which Key
Resources each partner/ stakeholder could provide and which sort of Key
Activities each one of them could execute. Companies hold partnerships with
other stakeholders to reduce risk and competition while gaining resources
and knowledge.
Key Resources
They include an analysis of the most crucial resources, mandatory to ensure
the execution of a business model (Sparviero, 2019). They may refer to
physical, human, financial, intellectual. and technological assets. The
evaluation of which of these resources are already possessed and which need
to be further developed and acquired is a fundamental element in the
planning. Resources should allow companies to function avoiding scarcity.
Key Activities
They refer to the main tasks a social entrepreneur needs to design and
develop in order to create a social venture. They enable and strengthen the
company’s mission and support the implementation of the business plan in
terms of impact and budget. Activities can be divided into different
categories such as production, problem-solving and platform/network.
Cost Structure
This part portrays the entire expenditures plan for the operation of the social
enterprise (Sparviero, 2019) and constitutes a core issue for its planning and
establishment. It comprises predetermined costs, such as payroll, leases, and
63
utilities, and potential varying expenditures in addition to interlaced points,
such as the “economies of scale” and the “economies of scope”. Companies
may focus on a cost-driven approach, trying to reduce costs to a minimum or
on a value-driven approach where costs are not of primary importance to
them.
Revenue
Financial stability based on assets constitutes a vital aspect of establishing
and operating a social enterprise. Revenue refers to all types of economic
capital provided to non-profit institutions, such as donations, fees, funds,
state financing, investments and presents (Sparviero, 2019). Revenues can be
fixed (a stable amount of financing) and dynamic (constant changes in cash
flow).
Value Proposition
Value Proposition illustrates the set of products and services which create
value for customers and beneficiaries. The SVP defines value by its social and
multifaceted pattern of quality (Sparviero, 2019). Value proposition responds
to the needs of customers and must be distinguishable from the values of
competitors. Customers should have a specific reason to choose a social
enterprise’s product instead of one of their competitors.
Type of Intervention
While designing a social venture, it is necessary to specify the structure of its
production and service operations. Emphasis is given to the innovative
procedures, schemes and services needed for implementing activities to
respond to social challenges (Sparviero, 2019).
Surplus
A social enterprise needs to produce a surplus in order to ensure
sustainability and accomplish its social aim. It is vital to decide and
disseminate how the surplus is going to be reinvested.
Segments
Segments refers to the potential groups of individuals or associations that a
social enterprise intends to approach and serve (Knode, 2016). Customer
segmentation refers to targeting particular customer categories with
distinctive characteristics. Companies should know the characteristics of
customers they aim to meet. In this way they manage to target certain
categories knowing they will consume the product and they avoid spending
sources to persuade other audiences that would never select the product.
64
5.5 Social Venture Opportunity
Identification
There This section aims to shed light on the elements that enable a potential
social entrepreneur to identify opportunities for creating a social venture.
The analysis comprises of the following:
► The elements are usually identified by a person interested in
undertaking a social project.
► The differences in the approach of an enterprise establishment
between a social entrepreneur and a typical businessperson.
► The motives that guide a potential social entrepreneur to undertake
a social venture.
► The means that enable a social entrepreneur to recognize an
opportunity for a successful social project.
► The procedure could help a potential social entrepreneur create a
social venture.
► The mindset needed to be adopted to develop and strengthen the
social business mentality.
Elements
Firstly, when referring to the elements identified by a person interested in
undertaking a social project, there are four main characteristics that should
be taken into consideration including, 1) the ethical fiber, 2) the potential
social impact of the idea, 3) creativity and 4) entrepreneurial quality
(Bornstein, 2007). By ethical fiber it means that the person who would
undertake the project should be trustworthy. His/her aim is not to take credit
on what has been done but to focus on managing the existing problems and
emphasizing collaboration with his/her partners.
The social impact aims at the dynamics of the individual's ideas. The goal is to
maintain the implementation of the ideas even if the person who proposed
them is no longer involved. Regarding creativity, it must be pointed out that
there are two main parts: goal-setting and problem-solving. Every social
entrepreneur needs to be creative and visionary. Moreover, the
entrepreneur must be able to set goals, know how to implement them, and
always maintain a degree of realism.
Differences
At this point, it is essential to clarify that although there is an overlap
between social entrepreneurs and commercial entrepreneurs in their activity,
65
there are also differences. On the one hand, social entrepreneurs aim to
promote social change; they are constantly dealing with social problems and
creating plans on their visions to solve those problems. According to their
finances, they are either self-sufficient (by setting-off activity amid their
client group as part of their social mission) or remain dependent on external
funding (Levie, 2010). On the other hand, commercial entrepreneurs aim
primarily for profits and favor the implementation of ideas with more
profitable potential, that can be either already existing or created. Before
implementing an idea, the commercial entrepreneur assesses risks (whereas
social entrepreneurs focus on the change they can make instead). Moreover,
a commercial entrepreneur does not choose time-consuming tasks, while
time for social entrepreneurs is not a problem. Commercial entrepreneurs
have a fundamentally different time management approach compared to
their social counterparts.
Motives
Social entrepreneurs are primarily motivated by non-economic motives. They
are inspired by environmental and social issues that must be managed by
people in need and helping the whole community (Gabarretet al., 2017).
Means for opportunity recognition
Literature in social entrepreneurship states that “Social entrepreneurs see
opportunities where everybody else sees problems.” According to
(Thompson, 2002) the procedure that might help a potential social
entrepreneur identify a social venture consists of four main steps as follows:
► Envisioning: recognizing an opportunity
► Engaging: Implementing an idea
► Enabling: guarantee that something occurs by obtaining the essential
resources
► Enacting: leading the project
Mindset
The mindset of the social entrepreneur consists of the following elements:
► Independency: Actions and innovative ideas that carve a new path.
► Responsibility: Failure is on the list of risks, but by taking
responsibility, opportunities for improvement are being created.
66
► Goal orientation: In order for a project to be successful, its main goal
and objectives should be clearly defined.
► Adaptability: The implementation of the project will lead to new
developments and the entrepreneur should have the ability and
attitude to adapt to them.
► Problem-solving: Entrepreneurs look for problems and solutions.
5.6 Conclusions
This chapter presents the basic concepts related to social enterprise business
models. To that end, the main components of social enterprise business
models and the different approaches a social enterprise can adopt were
presented. With this chapter, it is expected that the reader will have gained
knowledge on the different ways the business model can benefit a social
enterprise not only by the nature of the context in which it is embedded but
also by how they can elaborate their business models, and their business
mindset that guarantees their success.
67
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Schumpeter, J. A. (1975). Capitalism, Socialism, and Democracy (8th ed.).
Routlegde. https://periferiaactiva.files.wordpress.com/2015/08/joseph-
schumpeter-capitalism-socialism-and-democracy-2006.pdf
SOCIAL BUSINESS MODEL CANVAS, 2018. Social Enterprise Institute., 2018,
https://socialenterpriseinstitute.co.
Sommerrock, K. (2010a). Social Entrepreneurship Business Models. In
Palgrave MacMillan (Vol. 53, Issue 9). Palgrave Macmillan UK.
https://doi.org/10.1057/9780230298033
Sommerrock, K. (2010b). Social Entrepreneurship Business Models: Incentive
Strategies to Catalyze Public Goods Provision. Social Entrepreneurship
Business Models: Incentive Strategies to Catalyze Public Goods Provision, 1–
307. https://doi.org/10.1057/9780230298033
Sparviero, S., 2019. The Case for a Socially Oriented Business Model Canvas:
The Social Enterprise Model Canvas. Journal of Social Entrepreneurship,
10(2), 232–251, 2019, https://doi.org/10.1080/19420676.2018.1541011.
Thompson, John L., 2002. The World of the Social Entrepreneur. International
Journal of Public Sector Management 15(5):412-431.
Website: http://socialinnovation.lv
Williams, C. C., & Nadin, S. (2012). Entrepreneurship in the informal
economy: Commercial or social entrepreneurs? International
Entrepreneurship and Management Journal, 8(3), 309–324.
https://doi.org/10.1007/s11365-011-0169-0
69
Business Model Innovation
for Social Enterprises
Chapter 6
Photo by Kvalifik on Unsplash
Sami Huohvanainen
Metropolia University of Applied Sciences, Finland.
70
Chapter 6: Business Model Innovation
for Social Enterprises
Aim
Since social enterprises seek success economically and socially, such
companies need to be innovative in their business model. Therefore, this
chapter introduces the basic concepts and relevance of business model
innovation for Social Enterprises. To that end, this chapter shows
different approaches to business models, and how they are designed,
chosen, and changed by social entrepreneurs.
Expected Learning Outcomes
► To understand the main concepts related to business models
and social entrepreneurship
► To get familiar with the main concepts related to business model
innovation
► To learn what social innovation is and why it is important
► To gain an understanding of the relevance of applying a business
model innovation in a social enterprise operational environment
Keywords: Social Entrepreneurship, business model, sustainable
business model, business model innovation.
6.1. What is a business model?
A business model is a scheme in which organizations create, deliver, and
capture value. It is an organization’s approach to value creation. In
general, a business model is any organization’s ability to change or
adjust its value creation components and the way of functioning that
might contribute to its business success. Business models are typically
understood in three ways: 1) as component(s) of an actual business
model, 2) as part of an already operating business model, or 3) as change
models. (Linder et al., 2000).
“A business model
is a scheme in
which
organizations
create, deliver,
and capture
value”
71
A business model is a scheme in which organizations create, deliver, and capture
value. It is an organization’s approach to value creation. In general, a business
model is any organization’s ability to change or adjust its value creation
components and the way of functioning that might contribute to its business
success. Business models are typically understood in three ways: 1) as
component(s) of an actual business model, 2) as part of an already operating
business model, or 3) as change models. (Linder et al., 2000).
The core concept of a business model has various versions. According to
Sommerrock (2010), studies suggest there are three dimensions to business
models: 1) value creation and its architecture, 2) the value proposition, and 3)
some model of income mechanism (2010, p. 137). Morris et al. (2005, p. 729-
730) identified six critical components with several factors (see Figure 6.1.) in the
form of questions that underlie a business model.
Figure 6.1. Critical components of business models according to Morris et al,
2005.
“A business model is a scheme in which
organizations create, deliver, and capture value”
On the other hand, Linder and Cantrell (2000) divide an operating business
model into the following subcategories: (i) Pricing model, (ii) Revenue model, (iii)
Customer model (including channels and marketing), (iv) Commerce process
model, (v) E-commerce, (vi) Organizational form, and (vii) Value proposition
(Linder et al., 2000). One of the best-known contemporary business models is
Osterwalder’s business model canvas, which presents nine categories: Key
Partners, Key Activities, Key Resources, Value Propositions, Customer
Relationships, Channels, Customer Segments, Cost Structure, and Revenue
Streams (Ostewalder, 2010).
Business models can be divided into more components and categories and can
be developed further. There is also a model for organizations that describes their
ability to change the business model or its features - a change model. As
businesses are under a rapidly evolving operating environment, they are under
pressure to continuously change and improve their business models (Linder et
al., 2000).
Critical Components of
Business Models
Who do we
create value for?
What is our
source of
competence?
What is our
source of
competence ?
How do we
competitively
position ourselves?
How do we make
money?
What is our time,
scope, and size
ambitions?
How do we
create value?
72
As a business model summarizes an enterprise's core functions and processes, it
is usually a constant subject of change. Business models include a lot of
variables, and operational environments can change rapidly. This means that it is
virtually impossible for one static business model that would serve its purpose
for an enterprise wholly or for a more extended period. Since there are no
bulletproof models or concepts for every enterprise globally, the companies
need to have the capacity to adjust - innovate - their business models
themselves. Business model innovation has been briefly described and cited as
“the ongoing management process of developing and introducing improvements
and replacements” (Mitchell & Coles, 2004, p. 41)
Balan-Vnuk and Balan (2010) show how non-profit social enterprises innovate in
their business models to ensure the enterprise´s sustainability while generating
surpluses to fund core services. In their study, they interviewed Australian social
enterprise CEOs and found no expectations of governmental or philanthropic
funding. Therefore, in order to ensure sustainability and funding, social
enterprises need to adjust and innovate their business models.
6.2 Social Innovation
According to Dees and Anderson, there are two schools or literature streams
when it comes to social innovation, of which “one is concerned with the
generation of earned income as a funding solution to a social mission (the social
enterprise school); the other focuses on the actual approach to the best way to
solve a social problem (the social innovation school)” (cited in Sommerrock K.,
2010, p. 52).
Social innovation emphasizes the social outcome rather than economic profit in
social entrepreneurship. Despite this division of the two schools in literature,
they both share a common social mission – to address social problems and
challenges. It is also clear that enterprises need innovations to simultaneously
achieve their mission and be profitable.
6.3 Inclusive business model
One key aspect of social entrepreneurship is the participation and benefit of
people with limited access to resources, disabilities, and disadvantages. When
discussing business model innovation, one key factor is the inclusiveness of
disabled and disadvantaged people. Dentchev (2020) discusses Inclusive Business
Models (IBM) in three dimensions; in the first dimension, a solid traditional
business model leads to enhance social challenges. The second dimension
emphasizes the social inclusiveness of various groups. The third dimension
73
combines both social and economic dimensions for disadvantaged groups
(Dentchev et al., 2020).
6.4 Business Models at the Base of the
Pyramid
The base of the Pyramid (BoP) refers to the people with the lowest income or,
more generally, those dealing with poverty with a bottom-up approach (Dembek
et al., 2019). Poverty is a very complex issue, and the solutions are not simple.
When working with business models at the BoP, Dembek et al. (2019) discuss
sustainability as a critical element when improving business models to improve
social conditions.
Dembek et al. (2019) highlighted three categories of activities when it comes to
value creation models: (a) Delivering models to provide access to products and
services to BoP communities, (b) Sourcing models aim to source materials,
products, and services in communities and distribute them locally or globally,
and (c) Reorganizing models which aim to recreate or modify existing systems to
benefit communities (Dembek et al.,2019).
These three activities were also divided into three categories: the Entity-Based
model aims to provide a specific and small number of solutions for community
needs, the Project-Based model seeks to provide one-off solutions, usually for
developing structure, and Platform-Based models aim to offer many solutions for
several communities but targeting solutions for the communities that need them
the most. These three activities and three structural models together form nine
elements, as seen in Table 6.1. below.
Table 6.1 The nine elements of Business models at the BoP according to Dembek et al, 2019
Activity (ver)/
Structure (hor)
Entity
Project
Platform
Delivering
Entity-based delivery
models [DE]
Project-based delivering
models [DPr]
Platform-based
delivering models [DPl]
Sourcing
Entity-based sourcing
models [SE]
Project-based sourcing
models [SPr]
Platform-based sourcing
models [SPl]
Reorganizing
Entity-based reorganizing
models [RE]
Project-based
reorganizing models
[RPr]
Platform-based
reorganizing models [RPl]
74
6.5 What is business model innovation
then?
Balan-Vnuk and Balan, 2015, point out that sticking to a static business
model isn’t enough for enterprises to survive through competition and the
development of an operational environment. The products, services, and
processes should evolve through innovations; the same applies to the
business model (Balan-Vnuk et al., 2015). In other words, a business model
innovation could be understood as an ongoing mindset and process where
the enterprise constantly collects feedback, evaluates it, and adjusts its
business model (or its components) responsively and agilely.
Business model innovation can be considered a key factor in social
entrepreneurship and enterprises because the operational environment
emphasizes social dimensions, which could be more unpredictable than in
traditional business. In innovation theory, few types of innovations are
applicable in the context of business model innovation in social
entrepreneurship. In the Schumpeterian model, for instance, one can find
processes, organizational, and market innovation elements that might
serve the business model innovation purposes (Sengupta, 2014).
Photo by Slidebean on Unsplash
75
Processes, organization, and markets are all included in the core components of any
business model. Of course, innovating in products and services and innovations
around raw materials may benefit SE’s profits and thus be relevant factors of
business model innovation. Furthermore, it seems irrelevant to separate stand-alone
innovations from the ongoing innovative mindset of an organization. Therefore,
business model innovation can refer to a single new step or manner that contributes
to making the business model more efficient.
6.6 Premises behind business model
innovation
To implement a business model innovation, an enterprise should understand the
core premises that enable business model innovation. According to Balan-Vnuk and
Balan there are six premises: 1) Clear understanding of the organization’s social
mission, 2) Access to specialized knowledge, 3) Access to external expertise, 4)
Ability to respond to the needs of clients or beneficiaries, 5) Access to alliances or
partnerships, and 6) Ability to experiment with pilot programs (Balan-Vnuk, Balan,
2015).
The first premise, understanding an organization’s social mission, is essential for
getting through a business model innovation in a social enterprise. Social mission is
also a primary premise behind social enterprises’ social value creation process. For
instance, if an entrepreneur seeks to create social value of any type along with
economic value through business model innovation, performing upon the
statements of the social mission seems to be the way to go.
6.7 How to design, choose and change a
business model
How to choose or create a business model for a social enterprise? It remains a
question that needs to be answered when starting a profitable social business.
Studies give few suggestions about parts that have already been dealt with
previously in this chapter. One approach is to adapt an existing business model
suitable to the enterprise's social mission. The model should support all defined
social dimensions depending on the social mission and/or concrete social problems.
For example, to benefit all stakeholders equitably and/or sustainably. Several
business models have been tested, proven, and successful.
76
6.8 How to plan/design a business model
A standard tool for planning a business model, and frequently used as an operational
business model, is the business model Canvas, available in the Osterwalder
handbook (2010). The Business model canvas includes a business model's key
components and helps visualize the whole concept. Osterwalder's model has most of
the key features of business models discussed previously, namely 1) key partners, 2)
key activities, 3) key resources, 4) value propositions, 5) customer relationships, 6)
channels, 7) customer segments, 8) cost structure, and. 9) revenue streams.
A business model canvas is also applicable for social enterprise business model
design. In the social enterprise context, Qashtarin (2015) states that the Canvas
should add two more blocks: 1) Mission and 2) Impact and Measurements, which
both should be considered from the social (enterprise) point of view. The Mission
block is on the top of the canvas, and the Impact and Measurements are at the
bottom (Qashtarin, 2015). This concept aligns well with the idea of Ormiston and
Seymour (2011), as they focus on aligning mission, strategy, and environments
measurement in the heart of social value creation (Ormiston et al., 2011).
6.9 How to adjust/change the business
model
As argued before, numerous approaches and models exist for creating and adjusting
a business model. When implementing business models in social enterprises, it is
essential to consider the social value creation aspect since traditional business
models do not usually include social dimensions. One helpful idea comes from
Ludeke-Freund et al., (2020), who suggest that sustainable value creation (which
could also be read as social value creation) needs to include multiple shareholders,
optimally all of them in a participatory way (Ludeke-Freund et al., 2020). Transferring
this idea to practice here into a business model innovation, one could suggest that
the participation of all stakeholders in redesigning a business model could be
recommended.
77
6.10 Case Studies
Exercises/ Activities/ Further Discussion
Activity 1
Find a social enterprise that is familiar to you and/or from which you can access
information. Use Osterwalder´s business model canvas and try to fill and add
sections to the canvas according to your chosen case. Look carefully for components
that assist the social mission of the selected social enterprise.
Activity 2
Continue with the previous (activity 1) case enterprise. Find out and list all the
stakeholders you can find from the enterprise. Go through each stakeholder and list
at least three needs each stakeholder might have. If you can figure out more, list
them all. After you have listed each stakeholder's needs, try to form a big picture,
and figure out if there are stakeholders whose needs are not fulfilled. Are there
matters or concrete issues that need to be addressed? Now look again at the
business model canvas that you filled in Activity 1, go through each component, and
examine if any parts could be improved that would benefit one or more
stakeholders. If you were the C.E.O. or a board member, what would your suggestion
be for future improvement/innovation?
6.11 Conclusions
A business model consists of several components that can be divided further. Profit
corporations and social enterprises are always subject to economic competition;
social enterprises are also subject to generating social impact according to their
social mission. To manage under competitive and constantly changing operational
environments, companies need to observe their operations and business models and
be ready to adjust them if needed. Since there usually are not ready-made solutions
for changes or improvements, such changes need to occur through innovation. A
business model innovation may be a constant process or occur in multiple instances.
When innovating and redesigning a business model in a social enterprise context, it
should be executed according to the social mission and benefit several, if not all,
shareholders.
78
References
Balan-Vnuk E., Balan P. (2015), Business model innovation in nonprofit social
enterprises, Integrating Innovation: South Australian Entrepreneurship Systems and
Strategies Göran Roos Allan O’Connor
Dembek K., York J., Singh P.J. (2018), Creating value for multiple stakeholders:
Sustainable business models at the Base of the Pyramid, Journal of Cleaner Production
196, 1600-1612
Dentchev N.A. (2020) Inclusive Business Models: Building Business Ecosystems for
Resolving Deep-Rooted Sustainability Problems
Linder J, Cantrell .S. (2000), Changing business models, Working paper Accenture
Institute for Strategic Change
Mair J, Marti I. (2006) Social entrepreneurship research: A source of explanation,
prediction, and delight, Journal of World Business 41, p36–44
Mitchell, D. W., & Coles, C. B. (2004). Business model innovation breakthrough moves.
Journal of business strategy.
Morris M., Schindehutteb M. , Allenc J, (2005) The entrepreneur’s business model:
toward a unified perspective, Journal of Business Research 58, pages 726– 735
Osterwalder, A., Pigneur, Y. & Clark, T. (2010). Business model generation: A handbook
for visionaries, game changers, and challengers, Wiley
Qastharin A. R., (2015) Business Model Canvas for Social Enterprise, conference paper,
Sengupta, J. (2014) Theory of Innovation, Santa Barbara, Springer International
Publishing
Ormiston S., Seymour R. (2011) Understanding Value Creation in Social
Entrepreneurship: The Importance of Aligning Mission, Strategy and Impact
Measurement, Journal of Social Entrepreneurship, 2:2, 125-150
Sommerrock K., (2010) Social Entrepreneurship Business Models - Incentive Strategies
to Catalyze Public Goods Provision, Hampshire, Palgrave Macmillan.
79
Scaling Social Impact
Chapter 7
Photo by Linus Mimietz on Unsplash
Philippe Eiselein1, Abel Diaz Gonzalez2, Jorge Salas Vargas3
1Odisee, Belgium; 2Maastricht University, The Netherlands;
3Universidad Católica Boliviana, Bolivia.
80
Chapter 7: Scaling Social Impact
Aim
This chapter aims to outline the main elements that define what social
enterprises need to scale their social impact. To this end, we present below
a series of strategies, requirements, and scaling models that may be useful
for the reader to gain knowledge in this area of interest.
Expected Learning Outcomes
At the end of this chapter, it is expected that the reader will have the ability
to:
► Recognize the different scaling strategies that can benefit social
entrepreneurs
► Identify the different requirements for scaling up for social impact
► Understand the different models for scaling up for social impact
Keywords: Scaling, Social impact, Scaling strategies, models of scaling, social
entrepreneurship.
7.1. Introduction
Social entrepreneurs set up hybrid organizations in which they apply, to
some extent, commercial activities while pursuing their primarily social
objectives (Doherty, Haugh and Lyon, 2014). They aim to address market or
government shortcomings at a local or global level (Zahra et al., 2008). Most
of the time, social entrepreneurs are expected to grow the realization of
their social objectives, commonly called scaling. Syrus Islam (2020, p.1)
describes it as “an ongoing process of increasing the magnitude of both
quantitative and qualitative positive changes in society by addressing
pressing social problems at individual and/or systemic levels through one or
more scaling paths”. Alvord, Brown and Letts (2004) explain that scaling can
occur by either helping more beneficiaries (targeted people facing a social
problem), improving the benefits offered by a social enterprise has to their
beneficiaries, or broaden their impact indirectly by engaging more societal
stakeholders.
The relevance of the topic of scaling social impact stems from different
roots. First, current societies face numerous sustainability challenges across
“SE are expected
to grow the
realization of their
social objectives,
commonly called
scaling”
81
the Globe, whether in developed or developing countries. These are
problems that remain unsolved by governments, corporations, or NGOs,
such as poverty, inequality, homelessness, carbon emissions, or
unemployment (Murphy and Coombes, 2009). Over the last two decades, a
handful of SE cases were hailed for their creative solutions and innovative
approaches to solving these longstanding social problems. It is only normal
that we desire to explore further how we can get inspired, grow those
innovations, and make society more sustainable. Second, considering the
current non-profit financial trends, business models that are viable and
scalable are an essential topic for both research and practice. Thus,
increased attention is being given to cases globally, such as the Grameen
Bank, Tom Shoes, Citizenlab or Close the Gap.
In order to “increase the impact,” social enterprises must firmly grasp the
concept of the “Theory of Change” (Taplin and Clark, 2012). This theory
provides entrepreneurs with a perspective on how you eventually develop
change over time by breaking down more ambitious, high-level social
change mission statements into smaller, easier-to-manage objectives in the
middle and short run. Social entrepreneurs break down the social problem
into what they can observe and what the root causes are for those
problems. Afterward, they envision what they would like to achieve
between 5 to 10 years and develop a list of resources they will need to
acquire to develop activities. The consequences of these activities are then
broken down into three parts: i) the Actual results from the day-to-day
operations, focused on achieving social or commercial objectives. ii) How
the accumulated results from these activities develop intermediary
outcomes and iii) how the overall outcome performances, in the long run,
contribute towards achieving an ideal situation.
Figure 7.1 Theory of change
A good theory of change statement is built on indicators that are both
SMART (specific, measurable, achievable, realistic, and timely) and CARE
(comparable, aggregative, relatable, and easy to understand). It takes time
to develop such a statement, but it eventually allows for the following
generic statement to be developed:
“Problem – if (proposed solution) – then – because – which ultimately… -
this is proven by…”
82
Social entrepreneurs can develop and combine different strategies for their
theory of change. Other intended objectives of social change, size, and
scope, as well as the challenges and methods for achieving and measuring
it, need to be considered and are the focus of this book chapter. The
following sections discuss scaling strategies, challenges, and models from
the academic literature.
7.2 Scaling Strategies
Increasing social impact can be achieved in different ways. Perhaps the most
classical manner, or at least, the method everyone might consider, is to
grow the organization to be able to develop more activities and thus have
more impact. But organizational growth does not always equal more
impact. Based on a literature study of (Eiselein and Dentchev, 2021), six
types of scaling strategies can be considered by social entrepreneurs. The
scaling capacities of social entrepreneurs depend on several factors, such as
their core innovations (Alvord et al., 2004), their operational model (Alter,
2007), their ecosystem (Diaz, Dentchev and del Carmen Roman Roig, 2020),
as well as the type of hybridity present in their business model (Doherty et
al., 2014). Furthermore, social entrepreneurs need to overcome a series of
challenges located at the individual, organizational and institutional level. As
suggested by Weber, Kroeger and Lambrich (2012), the essential pre-
requisite for scaling social impact is the need for managerial skills and a
viable business model to create “just” social impact in the first place. In this
section, we discuss the types of strategies social entrepreneurs can pursue.
Figure 7.2 Scaling strategies, based on Eiselein & Dentchev (2021)
Social entrepreneurs tend to develop trial-and-error activities to develop a
balance between social and commercial objective realizations. In essence,
this implies that in the first instance, there should be a learning capacity
present within the social entrepreneurial team to increase their impact on
social problems. Should there not be sufficient capacity to reflect or learn,
scaling should not be considered (as it may cause more harm than good).
83
Otherwise, social entrepreneurs have a first set of scaling strategies at hand:
scaling deep or scaling out. Depending on whether the social entrepreneur
aims to keep on focusing on its current social problem and context, it may
choose to scale deep, which focuses on the learning curve, becoming more
efficient or more qualitative (Andre & Pache, 2016; Smith & Stevens, 2010).
It). By continuously learning and reflecting its current managerial processes,
social entrepreneurs may benefit the most from scaling deep, which is a
strategy that almost always throughout the life cycle of the organization,
can be applied. Scaling out, on the other hand, refers to tackling other
social problems by using the networks, experience and knowledge gathered
during the salvation of the social entrepreneurs’ original social problem
(Mair and Marti, 2009; Lyons and Kickul, 2013).
Social entrepreneurs may also consider increasing their activities or start
developing new products or services, should there be enough resources for
it. Typically referred to as scaling up (Gibbon and Dey, 2011) and branching
(Dees, Anderson and Wei-Skillern, 2004), these are more popular scaling
strategies. Tangible (financial, physical technological or organizational) and
intangible resources (human, reputation, or innovation) need to be
validated before adopting these strategies. However, these strategies do
not imply that the social entrepreneur cannot work together with partners
or stakeholders to achieve the social impact. But they may focus on
partnerships through a different type of scaling strategy.
Especially, when social entrepreneurs are lacking resources at hand, they
may opt to scale across (Weber et al., 2012), by working with other partner
organizations. There are different degrees of contracting that may occur in
such situations. One example is to franchise the SE’s model (social franchise
reference). Another, is to freely diffuse and share the approach of the SE’s
idea and innovation approach, hoping others will notice it, adopt it, and
start developing similar efforts elsewhere. Finally, in the events of not
having enough available resources, or not having enough or the right type of
partners, social entrepreneurs may counter-intuitively, scale down, i.e.,
doing less activities, which can improve their impact as both attention and
resources are no longer being spread too thin (Uvin et al., 2000).
We can conclude from these strategies that social entrepreneurs should not
feel pressurized to only grow their activities or organization but consider
their capabilities and environment in making the most suitable decision. It is
important to note that social entrepreneurs may choose diverse types of
strategies to grow impact, either over time or simultaneously. At the same
time, the learning capacity point also requires social entrepreneurs to
reflect on the numerous factors that may challenge them in creating or
scaling social impact. These are in fact requirements that need to be met or
at least considered, which we will discuss in the following subsection.
84
7.3 Requirements
Social As figure 7.1 suggests, perhaps one of the most crucial scaling
elements, at the individual level, refers to the managerial capabilities and
skills of the team of individuals within the social enterprise. This not only
refers to personnel members, but also towards their board members and
volunteers. But this is quite challenging, as social enterprises often are
composed of relatively small and agile teams (Eiselein and Dentchev, 2020).
This implies they need to have skillful people who not only agree with non-
competitive compensations (Austin, Stevenson and Wei-Skillern, 2006), but
also who have aligned values and drivers that are compatible with the
double bottom line of the organization (Eiselein and Dentchev, 2020). On
top of that, social enterprises are known for a high personnel turnover due
the restricted growth opportunities and high workloads (Hynes, 2009;
Murphy, Arenas and Batista, 2015), which causes losses of training
investments. Obtaining and retaining those complementary managerial
skills is quite challenging (Hynes, 2009).
Even when retaining skillful individuals, another challenge may limit the
scaling of social impact. Tensions may rise amongst individuals, as either the
objectives, or the methods of obtaining them, are a point of discussion. In
the search of complementary team members who adhere to the social
mission, differences amongst their personnel drivers may create conflicts
amongst themselves. As such, social entrepreneurs need to balance social
and commercial objectives with care. In essence, they need to recruit and
retain people who are fit within the double bottom line of the organization,
whilst simultaneously fit with one another.
This also applies when we consider individuals from different organizations.
As social entrepreneurs aim to deliver social change, they often involve a
wide variety of partners and stakeholders, whose diverse and sometimes
opposite expectations and demands must be well managed. This is where
the part on theory of change indicates that social entrepreneurs need to
develop a set of indicators or measures to be able to hold themselves
accountable (Ramus and Vaccaro, 2014), to gain legitimacy with
stakeholders (Gamble and Beer, 2015), as well as to improve their efficiency
and operations. It is difficult to develop a set of organizational, quantitative
metrics that can measure social impact. What is even more important to
scale social impact, is the involvement and empowerment of stakeholders
during the entire process of impact measurement and scaling. Stakeholders
need to accept those measures to gain their full support.
Furthermore, social entrepreneurs need to be aware of three more aspects
that can influence their scaling efforts. First, their legal form influences their
capacities to attract financial resources, thus influencing the types of
operational models they can develop (Lounsbury and Glynn, 2001; Wronka,
2013). Secondly, Smith & Stevens (2010) point out that the geographical
85
location of social enterprises, and the level of their embeddedness,
influence their capacity to scale. Thirdly, social entrepreneurs need to
develop an ecosystem perspective, in which they can identify societal
barriers, voids and pressures from various institutions and stakeholders
(Zahra et al., 2009; Estrin, Korosteleva and Mickiewicz, 2013).
7.4 Models of scaling
Value Next to the different scaling strategies and requirements, Han and
Shah (2019) identified diverse types of scaling models, which can be
implemented in the social entrepreneurs’ endeavors with the scope to
increase their social impact. The combination of these models with
strategies might offer complementary reflections and insights. They
identified what they call supply and demand, pathway, spiral, three-
strategies, and multi-factor models. By no means do we aim to be extensive,
but we will discuss from each of these models one popular example.
The SCALERS model was developed by Bloom and Chatterji (2008), where
they identified an acronym of scaling drivers necessary for scaling social
impact: “staffing, communications, alliance building, lobbying, earnings
generation, replication, stimulating market forces”. In an empirical study,
Bloom and Smith, 2010) confirmed that all of these drivers, except lobbying
and alliance building, are statistically significant. This model indirectly refers
to managerial capabilities (which you first need to attract and retain), the
social entrepreneur’s capacity to tap into a broad network of stakeholders
and partnerships across non-profit, for-profit, and public sectors.
The model proposed by Dees, Anderson and Wei-skillern (2004) refers to
three possible scaling strategies, which overlap to a certain extent the
strategies mentioned above. They refer to dissemination, affiliation, and
branching. According to Dees, Anderson and Wei-Skillern 2004, p. 28),
dissemination refers to providing information or assistance to others to
adopt or support the social entrepreneur’s activities, affiliation can refer to
coalitions and franchises, whilst branching is ‘the creation of local sites
through one large organization, much like company-owned stores in the
business world’ (Dees, Anderson, and Wei-Skillern 2004, 28). Depending on
the need for central coordination and resources, as well as the social
entrepreneurs’ need for control and moral intensity of the social problem at
hand, one strategy might get picked over another.
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The spiral model of Taplin et al. (2012) considers scaling from an iterative,
development perspective, where social entrepreneurs needs to consider
continuously: i) assessments ii) business model development iii)
implementation and iv) evaluation and improvements. In other words, they
take on a perspective similar to a project management life cycle. Its first
phase focuses on conceptualization and development, by means of
gathering data, identifying goals and needs, evaluating risks, strategies, and
practicalities. This is the part where resources, schedules, budgets, and
programs are being prepared. The actual implementation and evaluation
refer to the execution and transfer phases of a project life cycle, in which
the actual work is being tested, issues resolved, work packages being
delivered, and more importantly, all lessons learned transferred to a new
round of scaling. It is implied that social entrepreneurs have a go/no-go
decision to make at every stage of this framework.
7.5 Conclusions
Social entrepreneurs tend to focus on how they can grow their impact, as
very often the demand for their products or services are beyond their
supply capabilities. However, we would like to end this chapter with some
reflections. First, despite the innovative traits of social entrepreneurs, their
offer, by itself, is not enough to develop systemic changes. It requires social
entrepreneurs to always contextualize their growth perspectives, and to
take their time to develop their activities, no matter the scope or objectives
at hand. Furthermore, Smith and Stevens (2010) warn social entrepreneurs
that scaling is not without risk. For instance, with limited available
resources, social entrepreneurs need to be careful to not spread their
resources too thin, nor to dilute the quality of their products and services by
simply trying to achieve more than their capabilities allow them to.
Furthermore, with scaling, there is the potential risk of drifting away from
the social mission (Ebrahim, Battilana and Mair, 2014), as the increased
attention or need for commercial activities might attract more attention
from the entrepreneurs, or even become more important than the social
mission itself.
It is highly likely that due to the different definitions created over the last
decade for scaling social impact, confusion may rise amongst stakeholders
with the inconsistent use terms. For example, Bocken, Fil and Prabhu (2016,
p. 305) describe scaling up social impact as “increasing the number of
customers or members of a business as well as expanding its offer and
maximizing its revenues”. In contrast, Tjornbo and Westley (2012, p. 179)
refer to scaling up “to a change strategy that targets institutions, resource
flows, and beliefs at a broader systemic scale”. Yet again, for Lyon and
Fernandez (2012, p. 69), scaling up is “a continuum ranging from internal
87
organic growth controlled within the organization to wider dissemination of
good practice”. As such, the importance of truly engaging and aligning
different stakeholders from different sectors and backgrounds requires
social entrepreneurs to be capable of understanding different perspectives
and find a way to bring them together. It requires social entrepreneurs to
have both people management skills, as well as a sector knowledge.
Ultimately, they all need to develop a systems’ perspective should they
want to scale social impact, as it allows them to develop promising business
models.
Perhaps as a final message, there is an even more critical question social
entrepreneurs need to reflect on. In what time frame, and to what extent,
does one wish to scale. Scaling is an iterative process of reflection, testing,
calibrating, and evolving, but requires an impartial and honest opinion to
what extent one is being beneficial towards society, and at what point it
needs to start slowing down or even considering quitting. In the end, if the
purpose of a social entrepreneur is to solve social problems, by definition,
they should strive to no longer exist in the long run. As such, the question,
to what extent does one want to increase impact and in what time frame, is
almost existential for the business.
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Social Impact and Impact
Measurement
Chapter 8
Photo by eskay lim on Unsplash
Iliya Kereziev1, Diana Kopeva1
1University of National and World Economy, Bulgaria
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Chapter 8: Social Impact and Impact
Measurement
Aim
Measuring social impact is crucial in understanding if a social enterprise
is making a real difference to society and its stakeholders. This chapter
aims to introduce the social impact generation, the available tools, and
how to measure the impact of social enterprises' interventions.
Expected Learning Outcomes
► To understand what social impact is
► To explain why we need to measure social impact
► To describe how to measure the social impact created by social
enterprises
► To learn how to produce and apply a Theory of Change
► To effectively communicate and report social impact
Keywords: Social Impact, Social Impact Measurement, Theory of
Change, Communicating Social Impact
8.1. Importance of impact measuring
for social enterprises
Sustainable development is a key social and cultural challenge and goal
at national and international levels across all countries and economic
sectors. The UN Member States adopted an agenda for sustainable
development in 2015 (The 2030 Agenda for Sustainable Development),
which consists of seventeen (17) Sustainable Development Goals (SDGs).
These SDGs directly and/or indirectly correspond and interlink to social
entrepreneurship (SE). Social enterprises are characterized with their
duality to have equal economic and social objectives, and to try to solve
social needs or problems. Social enterprises target different stakeholders
characterized with different needs and expectations. Therefore, it is
important to track the changes after implementation of one or another
SE approach, how achieved outputs changed the target
groups/stakeholders, level of change, direction. Social impact relates to
the long-term positive changes for individuals, local communities, and
society, which result from interventions provided by social enterprises
(Keyte et al., 2016).
“Measuring social
impact is crucial in
understanding if a
social enterprise is
making a real
difference to
society and its
stakeholders”
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Measuring SE's impact will provide a clear picture of what is still not done,
where efforts should be refocused, and how resources should be used more
efficiently. In addition, social impact measurement and reporting can help social
enterprises access extra resources and build organizational legitimacy (Beugre,
2017). The results from impact assessment are essential for investors, business
angels, grant holders, as well as for target group involved in social enterprise
and those who are using outputs of social enterprise activity. Measuring social
impact is important for social enterprises because:
► It provides an improved sense of purpose, encouragement, and
clarity about what an organization is trying to achieve.
► It gives valuable feedback about the social enterprise's activities and
results. In this way there can be find gaps of performance and
possibilities for improvement.
► It provides measurement data and evidence of progress that can be
used as a marketing and communication tool.
► By measuring and reporting impact, social enterprises can retain
and attract donors, investors, clients, volunteers, and other key
stakeholders (Clifford et al., 2014).
The European Commission Expert Group on Social Entrepreneurship (GECES)
has developed a methodology for measuring impact assessment for social
entrepreneurship, the social impact across the enterprises in the European
Union. The proposed approaches will provide investors, business angels, social
risk investors, and grant managers with answers if it is worth investing in social
enterprises, and social entrepreneurs to achieve economic and social business
objectives.
Literature reviews reveal that scholars and researchers use different terms,
methodologies, and indicators to measure social impact. Moss, Short, Payne, &
Lumpkin (2011) and Santos (2012) are talking about social value as an indicator,
while Husted & Salazar (2006) , Mair & Marti (2006), and Nicholls (2009) use
social performance; Emerson (2003) is using indicator social returns, Hall, Millo
& Barman (2015) social return on investment (SROI), and social accounting by
Nicholls, (2009). Moreover, there is neither a commonly agreed and accepted
approach for the measurement of social impact nor a common understanding of
the overall aim of social impact measurement. Social enterprises measure the
social impact of their activity by combining economic/financial and social
indicators to present achieved goals. In social entrepreneurship, we can claim
that earned income strategies are interwoven to their mission, and performance
is a virtual blend of economic and social returns.
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8.2 Designing and implementing an impact
measurement strategy
Social impact measurement can be described as a process of determining how
much social change is achieved and can be attributed to a social enterprise's
work and interventions (SOPACT, 2022). There is no single and best approach to
measuring social impact (Muir, et al., 2014). The academic literature presents
various methods and methodologies used for social impact measurement
(OECD, 2014). This means that approaches to social impact measurement can be
tailored to the specific objectives and capabilities of the particular social
enterprise. Many approaches and methodologies are relatively complex in
terms of required expertise, skills and resources and can be time consuming
(Keyte et al., 2016). In determining the appropriate approach and designing
relevant measurement framework, one should consider the nature of the social
challenge that is addressed by the social enterprise, as well as the amount of
available resources and capabilities for the impact measurement (Impact
Investment Hub, 2022). The design and implementation of the impact
measurement framework is usually based on the concept of the Theory of
change (ToC) (Epstein, et al., 2014). ToC has variety of applications and can be
useful in the planning, design and execution of the social enterprise's work and
impact. Through this concept, every social enterprise could demonstrate its
progress and achievement towards desired social change.
While many different methodologies are used for social impact measurement,
they all follow similar processes and share common elements. According to the
European Commission's expert group on social enterprise (GECES), measuring
social impact involves five steps. In brief, these steps involve (i) identifying the
desired social impact and (ii) the concerned stakeholders, (iii) defining a theory
of change for social impact, (iv) designing an appropriate procedure for
measuring and reporting on inputs, outputs, outcomes, and actual impact, and
(v) analyzing how to improve the process of impact generation and change
achievement (OECD, 2015).
1. Identify objectives – define the impact analysis scope and the desired
social change to be achieved. Every organization with social goals should
specify its own impact objectives and needs to measure impact to be
able to make decisions on measuring and better managing the value
creation process (Clifford et al., 2014). Social enterprises need to be
clear about what they aim to achieve and how they will achieve it. In
this regard, a ToC is a helpful tool that can be used for setting objectives
of a particular intervention or organizational activities and describing
how the social enterprise works.
2. Identify stakeholders – identifying concerned stakeholders who need to
be involved in the impact measuring and reporting. Stakeholders have a
critical role in shaping whether and how a social enterprise achieves its
mission and objectives. Social enterprise stakeholders may include
95
beneficiaries, communities, funders, donors, governments, the media,
employees, volunteers, trustees, researchers, and consultants. Because
of their critical role, social enterprises need to analyze stakeholders'
motivations, needs, involvement, and contribution in social activities
and interventions and also for impact measurement. Impact
measurement involves engaging and interacting with a range of
stakeholders.
3. Setting relevant indicators by which the social enterprise will plan its
intervention and describing how the social enterprise's activities will
achieve its outcomes. With the help of the developed ToC, and
respectively identified goals, relevant and proportionate measures
should be developed that reflect what is being achieved in a clear and
comprehensive format according to the stakeholders' needs. The above
follows three steps: Definition of results, selection of the most
important results, and taking measures regarding the most
characteristic results achieved (OECD, 2015).
4. Measure, validate, and value – identifying measurement tools and
measuring the intended outcomes and impact, verifying that the logical
implications are strong enough and that the key stakeholders value the
impact. There is a plethora of tools for measuring social impact, but the
most used methods in the context of social enterprises are as follows:
Figure 8.1. Tools for social impact measurement according to Beugre (2017).
5. Report, learn and improve – the final step in the impact measurement
process involves reporting measured results regularly to internal and
external audiences. This enables most directly concerned stakeholders
to learn and improve the social enterprise's interventions and services.
Cost -
effectiveness
analisys (CEA)
Cost–benefit
analysis (CBA)
Social
accounting
and auditing
(SAA)
Blended value
accounting
(BVA)
Social return
on investment
(SROI)
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The reporting should be appropriate to the audience and needs to be
presented in a transparent and useful way, to encourage future
behaviors that are helpful and contribute to achieving the impact goals.
Good reporting means transforming data into presentable formats that
are relevant for key stakeholders. Reporting, learning, and improving
are iterative processes. Another common feature of most good impact
measurement methodologies is that an organization should only claim
credit for the changes that their services or interventions have created.
This involves considering the negative or unintended consequences
which then give a truer picture of the overall impact a particular service
or intervention has had (Clifford et al., 2014).
8.3 Theory of Change
All The measurement of social impact is based on a widely recognized impact
chain known as the Theory of Change. A ToC represents the social organization's
approach to creating change (Estonian Social Enterprise Network, 2017). This
refers to how the enterprise envisages the future and how it intends to get
there. It is basically the social enterprise's logic for change. The ToC explains and
illustrates inputs, activities, outputs, outcomes, and impacts in a way that shows
the pathway has been well-mapped (Beugre, C., 2017). It focuses on the link
between the input and outcomes of a process or how the transformation of
resources occurs and how this leads to the desired results.
ToC should start by describing a targeted problem. Subsequently, the target
group is outlined and specified. When that is done, one should consider the
changes that the intervention is to create and describe those as the kind of
effects the project will have for the target group. Finally, there is a need to
consider what activities can support and lead to the accomplishment of these
effects.
The theory of change follows the patterns according to GECES, 2013:
1. A social enterprise, or a project within it, has a supply of resources,
known as input. These may be financial, intellectual, human, premises,
or other (GECES, 2013).
2. With these inputs, social enterprises undertake activities. Activations or
interventions primarily focus on improving the lives of beneficiaries and
other concerned stakeholders.
3. The activities have points of contact with those beneficiaries, known as
"outputs." The output is not the result or the effect itself. Instead, it is
the way to get to the impact or the outcome.
97
4. The activities and results change the lives of the people who benefit and
other people who have a stake in the project. These changes are the
outcomes and are stated as the difference in situation between what
would have happened but for the service or product concerned and
what was achieved with it. Those outcomes may be short- or long-term,
depending on the need being met and the service or product being
delivered (GECES, 2013).
5. The outcomes may then be evaluated regarding the impact on a
person's life in terms of the value achieved for a given stakeholder by
reason of the service or product supplied. This is net of the gain
contributed by the intervention of others and considered both positive
and negative effects (GECES, 2013).
The theory of change can either be made as a schedule or presented in a more
illustrative way.
8.4 Key challenges of impact measurement
for social enterprises
There is uncertainty surrounding measuring impact, particularly as there is no
right way to design and implement a measurement framework. In this regard,
there is a range of conceptual and practical challenges which social enterprises
face when measuring social impact:
► Measuring social impact often involves measuring intangible elements
and soft outcomes or determining to what extent a social change can be
attributed back to the efforts and activities of particular social
enterprises.
► Because of a lack of staff skills and knowledge of how and what to
measure, it can be difficult for social enterprises to know how to design
and implement a measurement process.
► There is specific terminology in relation to measuring social impact that
can be used differently across the social sector and is hard to
understand.
► Even in the case of social enterprises that have experience with
measuring the social impact it can be difficult to precisely determine
whether their impact measurement frameworks are of sufficient quality
and how they can improve.
► Designing measurement framework should ensure achieving greater
impact and better manage impact, rather than focusing on
accountability and reporting.
► Social impact requirements are time demanding and complex, which
could be overly burdensome for social enterprises.
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► Social enterprises need relatively expensive resources and specific
capacities to measure impact, while the measuring should be
proportionate to the ability of the organization and to the usefulness of
the measurement generated.
► The needs for impact measuring and reporting of both the stakeholders
and the social enterprise should be aligned.
There is not one specific methodology or a standard set of indicators to measure
social impact of social enterprises, because of the diversity of the social
enterprise's stakeholders work within their contexts.
8.5 Communicating Social Impact
Social enterprises that try to engage and inspire their internal and external
stakeholders need to communicate the impact of their services and
interventions effectively (Thinknpc, 2018). Social enterprises can use the
information collected in the process of impact measurement to demonstrate
their work and the difference they make.
The communication of social impact could be described as a process of
collecting, analyzing, and reporting information to internal and external
stakeholders related to the social enterprise contribution to social change.
Communication of information about a social impact with the external
stakeholders creates transparency and credibility to the social enterprise's work.
Effective communication and reporting is particularly important for raising
investment, securing funding, building organizational legitimacy, or engaging
with the local community better. Social impact communication is also important
for internal organizational purposes. The internal stakeholders need relevant
and reliable information about work progress, outputs and outcomes achieved
to make decisions to improve impact strategies and operational performance of
their social enterprises (Estonian Social Enterprise Network, 2017).
Effective communication shares relevant and useful information to stakeholders
in appropriate way. The communicated message should reach the right
audience at the right time and in the right format. In this respect, social
enterprises first need to develop a communication strategy describing what and
to whom they want to communicate and then to report appropriately on their
mission, activities, and results. Social enterprises can develop their own
approach and plan to effective impact communication based on their audience,
intent, and message (Sheth, 2017). The social enterprise impact communication
strategy should answer to several questions:
• Why does the social enterprise want to communicate its impact? There
are many possible impact communication purposes – the social
enterprise might want to be accountable to its stakeholders; review its
99
activities and impact in comparison to intended mission and purposes;
revise and improve impact strategies and plans; recruit, motivate and
involve staff, volunteers, and potential supporters; and demonstrate
that it helps effectively to its target beneficiaries, etc.
• Who is the audience of the social enterprise impact communication?
The social enterprise needs to identify and analyze the characteristics of
the stakeholders who would like to know more about the social impact
generated. Different stakeholders have different expectations about
impact communication and reporting. If the social enterprise is trying to
address a variety of stakeholder groups, this requires different
communication strategies, formats, and channels to successfully deliver
a message.
• What message does the social enterprise want to communicate? The
content of the message should be relevant and interesting for the
targeted audience. In order to create a compelling message, the social
enterprise need to carefully plan the content of the message and the
emotions to appeal to.
• How does the social enterprise communicate the message?
(Creativelab, 2022). Social enterprises need to choose the right channels
to communicate the intended message. Depending on the interests,
habits and behavior of the target audience, the social enterprise could
choose the right channel to reach them. Some of the most useful
information channels to deliver communications related to social
change are:
► Posters, fliers and brochures
► News stories, articles and editorial on TV, radio and newspapers
► Press releases
► Blogs, videos, podcasts and other content on websites
► Social media post on Facebook, Twitter or LinkedIn, etc.
► Annual reports, annual reviews and impact reports
Generally, a thoughtful mix of communication channels will be useful to reach
various audiences with various communication preferences. A significant and
specific form for impact communication is formal impact report. Impact
reporting is an essential part of the impact measurement process. Reporting
refers to transforming the data into formats that can be understood by different
stakeholders. Impact reporting might take the form of an report or annual
report (Boswell & Handley, 2016). The best reports present valid information,
explaining what worked well, what did not work and setting out how the
organization is trying to improve (InspiringImpact, 2022). Impact oriented
reports should include all relevant information that allows internal and external
stakeholders to assess a social enterprise's performance and achievements, and
specifically include information on performance, risk, and organizational
capacity (Americansforthearts, 2020).
Impact communication is an ongoing process. Social enterprises could benefit
from impact communication and reporting, only if they engage in an ongoing
100
and reciprocal impact dialogue with their internal and external stakeholders.
Good impact reporting helps beneficiaries, volunteers, donors, funders and
other supporters understand and engage with an organization. It also helps staff
and trustees focus on results and work to achieve their vision. In addition, they
maintain open feedback channels and offer an insight on the type of
information that is useful and valuable to the various groups of stakeholders.
The social enterprise can use that information to adjust and improve its
operations and performance (Boswell & Handley, 2016; GECES, 2013; Pizarro &
Miranda, 2022).
8.6 Conclusions
This chapter has addressed the main concepts that define what social
impact is, why it is needed, and how the social impact created by social
entrepreneurs can be measured. Then, we elaborated on the definition of
the theory of change, which will be helpful to the reader. At the end of this
chapter, we elaborated on the importance of and ways to communicate
the social impact provided by SEs.
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References
Beugre, C., (2017). Social Entrepreneurship: Managing the Creation of Social Value, NY:
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Ecosystems for Social
Entrepreneurs
Chapter 9
Abel Díaz Gonzalez1, Bart Leyen2
1Maastricht University, The Netherlands,
2Vrije Universiteiteit Brussel, Belgium.
Photo by Clarisse Croset on Unsplash
104
Chapter 9: “Ecosystems for Social
Entrepreneurs”, connecting with others to
unleash social impact
Aim
This chapter aims to present the different elements of ecosystems for social
entrepreneurs. The increased interest in ecosystems is based on the
attention that it has generated among different stakeholders. This
awareness is because there is a need to understand how ecosystems actors
cohabitate and interact. This collaboration results in support to each other,
the advancement of their goals, and improved social impact. In this chapter
we discuss how ecosystems operate, how all different actors within the
ecosystems are interconnected, how the exchange of resources is
facilitated, and the development of multiple capabilities for social
entrepreneurs.
Expected Learning Outcomes
► Readers can enumerate ecosystem elements, and actors
► Readers understand how ecosystem actors engage with each other
► Readers can enumerate the different elements of ecosystem
support
► Readers can explain the advantageous position of the university in
the ecosystem
Keywords: Social Entrepreneurship, corporate social responsibility,
sustainability
9.1 What is a supportive ecosystem?
The increased interest in the ecosystem concept has led to a debate about
its scope, appropriateness, and boundaries. The concept includes
interesting attributes that are useful for today’s business activities.
Ecosystems allow us to analyze the environment and strategize for change
(Isenberg & Onyemah, 2016). Social entrepreneurs address complex social
and/or environmental challenges. This is without access to abundant
resources, and often without a comprehensive set of business skills. Hence,
they leverage resources provided by different supportive organizations
within the ecosystem (Williams & Lee, 2009). Social entrepreneurs are also
able to rely on other actors present in the ecosystem. These actors can
“Ecosystems allow us
to analyze the
environment and
strategize for
change”
105
provide them with different types of support including knowledge,
mentoring, networking, capital providers, legal and accounting advice, and
technical services (Roundy, 2017).
Spigel (2015, P. 50), argues that ecosystems are “combinations of social,
political, economic, and cultural elements within a region that support the
development and growth of innovative start-ups and encourage nascent
entrepreneurs and other actors to take the risks of starting, funding, and
otherwise assisting high-risk ventures”. The literature portrays ecosystems
as “fully functioning entrepreneurial or business environments.” And they
emerge from activities by entrepreneurs, and institutions that coevolve in a
“coherent system” (Malecki, 2018). In different studies, the ecosystem
concept is reflected as a composition of key factors that provide valuable
support for the success of entrepreneurs (Brown, 2016). These elements
include companies, financial organizations, consultants, incubators,
universities, and other public services (J. Roncancio-Marin et al., 2022). The
interactions, complementarities specialized knowledge, services, and
activities of all these actors have an impact on social entrepreneurs. They
allow social entrepreneurs to access multiple levels of resources needed to
create a positive impact and impact the overall success of their
entrepreneurial ventures (Roncancio, 2022; Roundy, 2017).
The conversation about ecosystems revolves around two key questions.
How do ecosystems work? What type of input is expected from every single
unit so that the support for social entrepreneurs materializes? The work of
Isenberg (2010) has been widely recognized as one of the most cited
frameworks of ecosystem composition. From this framework, we observe
different elements such as leadership, culture, capital markets, and open‐
minded customers. These elements interact cohesively to support an
environment where different entrepreneurs can operate. The framework
also presents the ecosystem as being surrounded by non-governmental
institutions, infrastructure, professionals support, investment bankers,
technical experts, and advisors.
Stam, 2015, highlights the main elements of entrepreneurial ecosystems.
These factors are necessary to obtain value creation as an outcome. They
include networks, leadership, talent, knowledge, support services, formal
institutions, culture, and physical infrastructure demand. These elements
are represented by several actors such as the local, regional, and national
level of government institutions and policy-making institutions. But also
support service organizations such as universities, incubators, accelerators,
business coaching, business plan/pitch competitions, co-working facilities,
entrepreneur networks, and physical infrastructure providers (Spigel, 2015).
Biggeri et al., 2017, argue that actors in supportive ecosystems for social
entrepreneurs operate with minimum legal constraints and with all kinds of
different resources. Volunteers and other organizations dedicated to
supporting the needs of social entrepreneurs are examples of important
106
actors. Existing work on the entrepreneurial ecosystem highlights the
relevant actors like industry associations, educational institutions, other
professionals, and customers (Biggeri, Testi, & Bellucci, 2017).
In general, the support received through ecosystems helps social
entrepreneurs with their challenges. It addresses their need for
complementary innovations, actors, and tools to achieve their mission
(Spigel, 2017). The process of solving social problems is neither bottom-up
nor top-down. It relies on a circular multi-actor collaborative perspective
(Letaifa, 2016). A more comprehensive review of the supportive function of
the entrepreneurial ecosystem should address the different roles adopted
by the different actors. Specifically related to the support and their
contribution in terms of activities and different roles adopted. We further
elaborate on this by presenting the different support archetypes.
9.2 How do Ecosystems for SEs operate?
Much uncertainty still exists about the concrete contribution of each
specific actor in the ecosystem. And their specific activities related to their
supportive function (Spigel & Harrison, 2018). To date, only a few studies
explain the supportive roles these stakeholders adopt in the ecosystems
(Roundy, 2017). But there is not a clear overview of how each offers support
to the whole system. An ecosystem is mainly composed of several actors,
executing particular activities, and exchanging resources, knowledge, and
information. These members assume specific roles depending on their
specialization and function (Adner, 2017). With this characterization, Adner
advances ecosystems as the “alignment structure of the multilateral set of
partners that need to interact for a focal value proposition to materialize.”
The ecosystem, therefore, operates based on different activities, actors,
positions, and links. And all these elements combined create a supportive
function for all stakeholders participating in the network (Dees, 2007).
Actors in an ecosystem may include individuals, business organizations, or
public institutions, in summary, all parties involved (Mason and Brown,
2014). Ecosystem actors are interdependent (Audretsch & Belitski, 2017),
and form a diverse and dynamic community (Olav Spilling, 1996). The
support function of an ecosystem is dependent on its actors. More
precisely, the number of actors, their skills, knowledge, and motivation to
undertake different activities (Ben Letaifa & Reynoso, 2015; Wronka, 2013).
(Pistrui, 2008) argues that the motivation to play a supportive role within an
ecosystem is related to the common vision, commitment, passion, and
striving for a common goal.
Supportive actors play a complementary role within an ecosystem. Their
activities include mentoring, coaching, networking, and training (Prahalad &
Hart, 1999). The diversity of the different kinds of actors could be
interpreted as a success factor for the complementarity of actions (Biggeri
et al., 2017). But it adds a level of complexity to an ecosystem. Therefore, it
107
is important to have a clear view of the boundaries, hierarchy, and structure
of the ecosystem. An overview of the relationships and dynamics among its
actors is valuable as well (Biggeri et al., 2017).
Actors in ecosystems are interconnected and they execute specific activities
or actions that generate multiple outcomes. These include training,
financing, mentoring, volunteering, etc. These activities can be seen as a
result of innovation, manufacturing, service development, and distribution
(Stam, 2015). This makes ecosystem activities closely related to the
collective and individual output of the products and services. Roundy et al.
(2017) stress the importance of arranging the ecosystem activities towards a
specific output. Examples of this are financial activities like loans, seed
capital, investment, grants, and foundation grants. Universities also provide
support in the ecosystem. They enable knowledge sharing upstream,
coaching, education, or promotion of entrepreneurial activities (Li &
Garnsey, 2013). The support activities are intended to strengthen
knowledge, resource availability, and skills within the ecosystem. In turn,
this fosters the development and growth of the focal ecosystem actors
(Letaifa, 2016)(B-Hert, 2006; Miller & Acs, 2017).
The roles of the different actors is an essential component of the
functioning of an ecosystem. These roles range from social to political,
economic, and cultural (Spiegel, 2017). A further nuance of these roles can
be found in the work of (D. Isenberg, 2010). He asserts the importance of
finance, policymaking, knowledge generation, leadership, and
infrastructure. Adner (2017) argues that in a successful ecosystem, all actors
are satisfied with their position. And this is reflected in the well-addressed
needs of ecosystem actors. If this is the case, the support function typically
provides resources, knowledge, infrastructure, and advice to its members
(Ellis, 2011; Liu & Stuart, 2014; Ranganathan & Rosenkopf, 2014). And
thereby strengthening the ties between actors in the ecosystem (Leung et
al., 2006).
Throughout the activities and their roles, ecosystem actors enable the
exchange of different resources, knowledge, information, and materials.
These transfers help actors to realize their different objectives, whether it
be scaling, supporting, or competing with others. Here, the focus should be
on the support activities that exchange content between supportive actors
and others. The links across the ecosystems allow for the creation of an
ecosystem structure (Adner & Kapoor, 2010; Uzzi, 1997). These links are
distributed depending on the size and amount of actors present (Semrau &
Werner, 2014). Established links allow actors to receive support from others
in the form of crucial information and valuable resources. These exchanges
are based on the complementarity, resourcefulness, and social capital of
actors across the ecosystem (Greve & Salaff, 2003). The interactions
between actors can be stimulated, but established interactions can support,
and intensify the value-creation process even more (Larson, 1992).
Ecosystems nurture and grow thanks to strong industry networks and
108
connections. This is only possible through the supportive local culture and
the ability to reconfigure relationships when an adverse event occurs
(Malecki, 2018).
9.3 What does a variety of actors mean?
One of the key aspects of an ecosystem is the interconnectedness and the
variety of actors (Pistrui, 2008). This means that there is a full range of
different actors from different disciplines. And their specialization,
experience, and accumulated knowledge in different areas of expertise
nurture the ecosystem as fertile grounds to sprout innovation while
supporting growth (Adner & Kapoor, 2010). Having multiple actors, and big
entrepreneurship-stimulating-events does not mean that an ecosystem
works optimally (Lavie, 2006). Like in any other network, an ecosystem is
based on the different relationships that can be derived from the multiple
actors working together (Spigel, 2017). This is what we mean by
interconnectedness. In an ecosystem, a variety of actors is needed, but the
different established connection between them is what makes the
ecosystem alive and functional (Adner, 2017).
The definition of a common value proposition is needed to develop
cohesiveness among actors within an ecosystem (Adner & Kapoor, 2016;
Brusoni & Prencipe, 2013; Li & Garnsey, 2014). In terms of a supportive
ecosystem for social entrepreneurs, this value proposition is a common
understanding of all actors involved. This consensus is reflected by their
specific roles, intentions to collaborate, and the division of resources,
knowledge, and information that can support the activities carried out. And
this applies to all actors involved in the social innovation value chain,
including social entrepreneurs (Biggeri, Testi, & Bellucci, 2017).
In this line, we concur with the definition brought by Spigel (2017), who
asserted that an ecosystem is “A set of interdependent actors and factors
coordinated in such a way that they enable productive entrepreneurship.”
Actors alone cannot enable collaborations and support in an ecosystem. To
spur collaboration and support, ecosystem actors need to share a common
understanding and have knowledge of their roles and comprehend the roles
of their peers. To be able to commit, understand, and facilitate the
interactions across the ecosystem, an understanding of the capacities,
competencies, and resources that others have is important (Acs, Stam,
Audretsch, & O’Connor, 2017; Autio & Thomas, 2014).
The main actors in an ecosystem can be classified according to their
contributions to creating a supportive environment (Diaz Gonzalez &
Dentchev, 2021). We find different actors that could be classified into three
different support categories (as can be seen in the Figure 9.1.) (a) Fuel, (b)
Hardware, and (c) DNA:
109
Figure 9.1 Actors’ categories in a supportive ecosystem
These categories are developed based on the different levels of resources
and support attributes that ecosystems can offer in support of social
entrepreneurs. Fuel brings all essential resources that enable and maximize
productivity to the ecosystem. It supports the movement of actors and their
interaction and boosts entrepreneurial activity. Therefore, Fuel embraces
elements such as funding, qualified human capital, supporting actors, and
extended networks.
Within the Hardware category, we find more specialized resources,
including knowledge and infrastructure. Hardware includes a variety of
tools, like physical infrastructure and specialized services. The last category
of support is DNA. This characterizes the local dynamics of the ecosystem
within a certain level of boundaries. It helps to foster and strengthen both
Fuel and Hardware. Entrepreneurial culture, policies, and visibility are the
subcategories of support available through DNA. These elements facilitate
the availability of resources within Fuel and provide access to the resources
through Hardware.
Universities are well-positioned actors within the ecosystem to provide
support (Sánchez-Barrioluengo & Benneworth, 2019; Wright & Siegel,
2015). Universities possess two interesting factors that facilitate their
engagement in supporting activities towards entrepreneurs, indistinctively
of their abundance of resources or infrastructure. The first factor is related
to their organic positioning and interaction with external stakeholders such
as governments and industry (J. Roncancio-Marin et al., 2022). This setting is
a process that is well illustrated in the third, quadruple, and quintuple helix
Hardware
DNA
Fuel
110
of innovation (Carayannis & Campbell, 2010). These interactions make
university actors engaged in a dynamic dialogue with local partners. This
environment often spans support activities that are useful for entrepreneurs
and entrepreneurial dynamics. Secondly, universities are well-surrounded
by students, faculty, and staff. These critical masses accumulate high levels
of human and social capital. This confluence can create abundant
opportunities to expand collaborations and support through coaching,
mentoring, and volunteering, as well as curricular and other extracurricular
activities within the ecosystem (J. J. Roncancio-Marin et al., 2022; Wright et
al., 2017).
9.4 Conclusions
This chapter presented definitions of a support ecosystem for social
entrepreneurs. We also describe why it is essential to understand how such
ecosystems operate, which actors compose them, and, above all, how social
entrepreneurs can benefit from the dynamics of all these stakeholders.
111
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116
Funding Social Enterprises
Philippe Einselein, Odisee, Belgium.
Chapter 10
Photo by Josh Appel on Unsplash
117
Chapter 10: Funding Social Enterprises
Aim
Despite the potential impact social enterprises can have in transforming
societies sustainably, funding remains one of its most challenging facets.
This chapter aims to provide more nuance and clarity on what is
discussed in academic literature. The chapter provides an overview of
the different funding sources available to social enterprises, the two
mainstream strategies social entrepreneurs can opt between, the types
of financial models they can develop, and factors of influence.
Expected Learning Outcomes
At the end of this chapter, the reader is expected to have the ability to:
► Distinguish between the different sources of financing for social
enterprises.
► Identify the most suitable strategies for financing social
enterprises.
► Understand the different financing models and the factors that
influence them.
Keywords: Funding sources, funding strategies, models of funding,
social enterprises funding.
10.1 Funding sources for social
enterprises
The number of social entrepreneurs has grown significantly in recent
decades worldwide (Ebrahimet al., 2014). They have attracted public
interest with their ability to successfully address social problems and
provide innovative approaches to social issues. However, it became clear
that social entrepreneurs face challenges that impede the scalability of
their social ventures. And this hinders their ability to deliver social value.
Generally, social entrepreneurs face similar challenges as traditional
entrepreneurs, and on top of those, they have specific challenges faced
by social SMEs. In addition to the economic aspects, social
entrepreneurship aims to solve social problems or establish social
change. The goal of social entrepreneurship is not only to maximize
profits but to solve social problems. This adds a new goal and poses new
challenges for social entrepreneurs.
“The most popular
funding source for
social enterprises
has become the
Internet, thanks to
the development
of crowdfunding
platforms”
118
A wide range of funding sources are at the disposal of social enterprises, as they
can apply for instruments that are classically associated with and provided to,
both the nonprofit and for-profit sectors. Typical examples include grants,
sponsorships, subsidies, foundations, philanthropic institutions, donations, low-
interest loans, equity, debt or mezzanine capital (Achleitner, Spiess-Knafl and
Volk, 2014; Dentchev et al., 2020). Social enterprises can also apply for several
new instruments that have been developed specifically for them, such as impact
investments, social impact bonds crowdfunding platforms, or specific
competition prizes (Castellas, Ormiston and Findlay, 2018; Dentchev et al.,
2020).
According to Lyons and Kickul (2013), the most popular funding source for social
enterprises has become the Internet, thanks to the development of
crowdfunding platforms. Social enterprises can also apply for social impact
bonds, in which they act as service providers for governments (Fraser, Tan and
Lagarde, 2016). Social enterprises can also participate in various regional or
international competitions, such as the European Social Innovation
Competition, Chivas Venture, Yunus and Youth or Global Citizen Award. Various
network organizations such as Ashoka or Sociale Innovatie Fabriek, or education
centers such as the VUB or Vlerick Business School, may also offer some funding
opportunities.
Table 10.1. Overview of types of funding sources
Non-profit
sources
Specific sources
For-profit sources
Bootstrapping
Crowdfunding platforms
Subsidies
Donations
Grants
Sponsorship
Foundations
Philanthropic
institutions
Social Impact
Bonds
Competition
prizes
Market-driven
activities
Loans
Equity
Venture Capitalist
Angel Investors
10.2 Strategies
Surprisingly, despite the options, studies have shown that most social
enterprises have difficulties staying financially healthy (Haski-Leventhal and
Mehra, 2016). This can mainly be accredited due to the SE’s complex business
models (Martin, 2015). Both in terms of hybridity and financial model, social
entrepreneurs work on delivering multiple types of values towards multiple
types of stakeholders. Throughout the literature, two mainstream financial
strategies seem to emerge. One approach builds on the vast range of funding
119
resources available to social enterprises and aims to diversify their funding
sources as much as possible. It follows the same logic of what nonprofit
organizations aim to achieve (Carroll and Stater, 2009), i.e., stability by reducing
the risks of being overly dependent on one funding source. It is not uncommon
for social enterprises to combine donations, subsidies, and market-based
activities to finance their activities (Szymańska, Van Puyvelde and Jegers, 2015).
However, SEs need to be aware of the potential drawbacks, such as the
crowding-out effect (Carroll and Stater, 2009; Siqueira et al., 2018) as well as
the unstable nature of these sources. The former refers to the effect where one
source decides to withdraw its support, due to the presence of another.
Regarding the latter, while the diversification strategy has its benefits in terms
of risk-averseness, donations, and subsidies, it may be susceptible to contextual
(socio-cultural and political) variances. Recent trends of withdrawing support
from governmental bodies have shown that social enterprises and “classic”
nonprofit organizations have felt financial pressure to behave more
autonomously. In other words, social entrepreneurs should strive to become (to
a certain degree, at least) financially independent. This resonates with the
“earned income” school of thought (Margiono, Zolin and Chang, 2018), which
considers the self-earned income generation throughout market-based
activities as essential trait of social enterprises (Defourny and Nyssens, 2010).
Generating independently, one’s own funding is often linked to social
enterprises' growth ambitions and capacities. An organization implementing an
“earned income” approach is often considered more financially sustainable
(Salvado, 2011). Not only that, despite its difficulty, an autonomy-oriented
approach provides better possibilities in terms of scaling, i.e. amplifying social
impact over time as well (Tirumalsety and Gurtoo, 2019). Earned income refers
to the sales of goods or services to customers. Depending on the type of hybrid
organizational form the SE takes, customers may or may not be in the same
audience as the intended target group of people SE wishes to help. Sometimes,
the intended beneficiaries cannot pay for the services provided. In a way, a third
party pays for them then.
But what is better, to diversify sources or to focus on making your own money?
The most suitable funding strategy depends heavily on the life cycle stage the
social enterprise is in. According to Dentchev et al. (2020), social enterprises
follow almost the same life cycle stages than “classic” enterprises, ranging from
ideation, validation, building, and growth. Assuming it is quite difficult in the
earlier stages of the life cycle to develop market-based activities, a more risk-
averse strategy, i.e., diversity, could be more suitable from a financial
sustainability perspective. On top of that, by diversifying its financial sources,
social enterprises can increase their visibility and network more transversally,
which benefits their story's legitimacy development. However, it is essential to
note that the social enterprise's life cycle is taking a plodding start, requiring
lots of patience regarding financing.
120
Figure 10.1. Two main financial strategies of social enterprises.
10.3 Model
Social enterprises represent a new type of business model (Seelos and Mair,
2005), and are also sometimes referred to as a hybrid organizations (Smith,
Gonin and Besharov, 2013). This type of organization's central characteristic is
about balance and, in the case of unbalance, conflict. Social enterprises mainly
face mission drift or financial unsustainability. This occurs when either too much
attention is given to the organization's financial needs to the social mission's
detriment (Ebrahim, Battilana and Mair, 2014a). Or, in the latter case, when
entrepreneurs remain too ideological and do not pay enough attention towards
organizational survival. Numerous studies have been investigating how social
enterprises have to deal with the conflicting objectives of social enterprises and
the conflicting expectations of their surrounding stakeholders (Ebrahim,
Battilana and Mair, 2014b; Lute and Gore, 2014; Eiselein and Dentchev, 2020).
Funding providers have a powerful position and can impose social enterprises to
prioritize their needs over other stakeholders. In part, this of course depends on
the type of hybrid model the social entrepreneur develops.
Santos, Pache and Birkholz (2015) developed a typology of four hybrid models.
A two-by-two matrix distinguishes hybrids on whether the clients are the
beneficiaries and whether there are automatic value spillovers or contingent
value spillovers developed. They identify market hybrids, bridging hybrids,
blending hybrids and coupling hybrids. According to the authors, examples of
these categories include BoP (bottom of the pyramid) initiatives, an integrated
business model with job matching for people with disabilities microfinancing
organizations and work integration social enterprises (WISE). They differ in
levels of mission drift risk as well as financial sustainability. Moreover, the ideal
financial mechanisms differ among them, respectively with impact investing,
venture philanthropy, fixed-income credit products, and social impact bonds.
Diversification
strategy Autonomy
strategy
121
Indeed, according to Hines (2005), not every funding source will be suitable for
each type of hybrid, depending on the overall mission and strategy.
Alter (2007) provided an overview of nine types of financial models, depending
on the level of embeddedness of the social and commercial activities. He makes
the distinction between embedded, integrated, and external social enterprises.
According to him, embedded social enterprises share social and commercial
activities, where the clients are the same target group as the beneficiaries. He
identifies 7 types of operational models that can take up this first form:
entrepreneur support model, market intermediary model, employment model,
fee-for-service model, low-income client as market model, cooperative model,
and market linkage model.
Embedded SE Integrated SE External SE
Figure 10.2. Types of social enterprises, based on Alter (2007): social and commercial activities can overlap (fully
or partially) or be completely separated from one another.
An integrated social enterprise has an overlap between social and commercial activities and creates
synergies between both. This can be done through cost-sharing or asset leveraging, for example.
Two types of operational models can take up this form: the market linkage model and the service
subsidization model. An external social enterprise clearly separates social programs and business
activities. Commercial and social activities are linked through specific ownership and relationship
mechanisms between them. Commercial activities are only present to support social activities. Alter
(2007) identifies with this type of social enterprise the only operational model as the organizational
support model.
Among those nine models, the only operational model that can occur within both embedded and
integrated social enterprises is the market linkage model. However, it does not mean the social
enterprise is bound to use only one model. It is not uncommon for social enterprises to combine
operational models. Some of these yields a higher commercial in an integrated or external social
enterprise, or social return in an embedded social enterprise. This is often at the core of the
complexity of social entrepreneurial business models. They mix and mesh up different services and
goods to achieve seemingly conflicting objectives. To round up the types of operational models
social enterprises can use, it is important to pay attention to one more in particular.
The Franchising Model. In the event of developing a proven, successful social entrepreneurial
business model, social entrepreneurs may increase their impact by letting others replicate their
model under a franchise (Giudici et al., 2020). Nevertheless, various factors must be accounted for if
the social enterprise aims to become financially successful.
122
10.4 Factors of influence
At the individual level, the social entrepreneur’s financial and networking
skills are essential (Jones, Latham and Betta, 2008; Scott and Teasdale,
2012; Dufays and Huybrechts, 2014). They need to attract and convince
like-minded, yet complementary and skilled people to provide their
valuable time or resources to support their social cause. Social
entrepreneurs envision social change, which requires an extended amount
of time and effort to be achieved. While entrepreneurs must find ways to
attract financial resources, they should also actively pursue strategies that
diminish or dissolve costs. Being cost-efficient by developing strategic
partnerships is another possible way of “funding” the social enterprise.
Most important here is that the social enterprise can develop a legitimate
reputation, being a trustworthy and capable changemaker.
At the organizational level, social enterprises' impact measures play a
crucial role in attracting funding. In essence, funders want to objectively
assess how the social enterprise is performing both in terms of social and
economic objectives. This gave rise to the recent and popular concept of
“social return of investment”, amongst many others. SROI means x. A
study by Maas and Liket (2011) identified numerous impact measures in
different kinds and nature.
However, social impact is often complicated to measure, as Austin, Stevenson and
Wei-Skillern (2006, p.3) point out: “due to non-quantifiability, multicausality,
temporal dimensions, and perceptive differences of the social impact created”. Next
to the impact measures, one should also acknowledge the difficulty in recognizing
social enterprises. As there is often a lack of a separate legal entity, social
enterprises are often forced to adopt a non-profit or for-profit legal structure in
most countries. This limits their capabilities in combining funding approaches from
the opposite sector.
Photo by Mathieu Stern on Unsplash
123
At the societal level, the degree or level of development of the social entrepreneurial
ecosystem (Diaz and Dentchev, 2021) itself, may also influence the support or ease
of access to funding sources. As such, the presence and kind of resources supporting
organizations have to offer heavily influence social enterprises' funding
opportunities. Supporting organizations can either directly or indirectly provide
funding opportunities. Indirectly, governments, universities or municipalities may
offer for example the right institutional frameworks or networks or may even act as
intermediaries with different actors in the broader ecosystem.
10.5 Conclusions
Over the last two decades, social entrepreneurship research has been developing a
growing knowledge of diverse topics. It analyzed its role in society, examined
entrepreneurial behavior and validity, as well as organizational governance. Social
enterprises' funding has started to gain attention at the crossroads of the latter two
streams in recent years. Funding social enterprises requires a broad horizon, and to
consider multiple facets that are interlinked. Strategies, skills, contexts, business
models, type of hybridity… funding social enterprises is not easy and requires
stakeholders to look beyond the difficulty of getting funding. As Dentchev et al.
(2020) explained, some social enterprises may be misguided to blindly stare at the
challenges of “access to funding” or “complexity of business models”. Certainly,
funding comes with a fair number of obstacles, but social enterprises can always find
a way to fund themselves throughout different life stages. As long as they keep their
eyes open and keep on reflecting and improving themselves.
Even in more recent times, several Belgian social enterprises were able to redefine
and reinvent their business models, using such a crisis to underline their importance
and contribution to society. They had every right to complain about funding, and yet
they kept on developing the viability of their business models. If their funding
challenge can survive even such a crisis, there is much to learn we all have from
them. Perhaps for future research endeavors, academics will venture more into
quantitative research methods to get a better picture of the financing of social
enterprises, as most of the social entrepreneurship research has been conducted
primarily through qualitative in-depth interviews, focus groups, case studies and
anecdotal stories. Hopefully, future research will develop new insights that will
contribute towards the resilience of social enterprises, while inspiring non-profits
and for-profit organizations to adopt multi-stakeholder, multi-value creating
activities.
124
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128
Social Entrepreneurship and
Inclusive Business Models
Chapter 11
Savvatou Tsolakidou,
National and Kapodistrian University of Athens, Greece.
Photo by Agence Olloweb on Unsplash
129
Chapter 11: Social Entrepreneurship and
Inclusive Business Models
Aim
Social entrepreneurship contributes to important objectives, such as inclusiveness
and equal opportunities. Social entrepreneurs channel resources to resolve social
problems that affect disadvantaged groups. To increase their social impact, they
can adopt an inclusive business model, i.e., by involving low-income communities
in both the demand and supply sides, as clients, employees, producers, and
entrepreneurs. Indeed, economic inclusion in the labor market refers to the
equality of opportunities, regardless of gender, age, and socioeconomic status. For
this purpose, it is important to analyze social vulnerability and the groups targeted
through inclusive business models. Key factors linked with vulnerability are
poverty, health status, ethnicity, and migration. Moreover, social enterprises may
also support smallholders in establishing stronger negotiation positions in the
market, via access to market information and capacity building. Finally, the
contribution of Corporate Social Responsibility (CRS) and circular economy is
explored. These are both promising concepts which contribute to societal goals,
along with social entrepreneurship.
Expected Learning Outcomes
► To define inclusive business models
► To discuss the integration of vulnerable groups
► To learn about the contribution of Corporate Social Responsibility (CRS)
and circular economy, along with social entrepreneurship
Keywords: Social Economy, Social Entrepreneurship, Inclusive Business Models,
Social Vulnerability, Marginalized Groups, Circular Economy
11.1 Introduction
Over the past years, sustainable economic development has been steadily gaining
momentum. There is now a growing consensus that economic and social
development are not conflicting concepts (Barbier, 1987; 2015). This economic
approach fosters long-term financial growth, while not harming the environment
and future generations. The World Bank has advocated the “win-win” prospects of
sustainable economic development, underlining that overreliance on the private
sector could result in poorly coordinated markets and exclusion of disadvantaged
groups (Hamilton & Clemens, 1999). Similarly, the United Nations’ 17 Sustainable
“SE contributes
to important
objectives, such
as inclusiveness
and equal
opportunities”
130
Development Goals which serve as a blueprint to address global challenges (such
as poverty, hunger, and inequality within and among countries - see goals 1, 2 and
10) promote sustainable economic growth along with productive and decent
employment for all (goal 8) (United Nations, 2015). To reduce social inequalities
and promote economic growth, both states and the free market have started
implementing this economic approach, e.g., by introducing inclusive business
models, corporate social responsibility (CSR) policies and circular economic models.
However, although we are living in an era of economic growth and widespread
improvements in living standards, inequality (i.e., economic inequality and
inequality of opportunities) remains a challenge and it is intricately linked to other
issues, such as climate crisis, urbanization, and migration (United Nations, 2020).
To reduce social inequalities and promote economic growth, states and free
markets started implementing an economic approach, e.g., by introducing inclusive
business models, corporate social responsibility (CSR) policies and circular
economic models.
11.2 Defining Inclusive Business Models and
Social Entrepreneurship
As explained in previous chapters, social entrepreneurship aims at creating and
sustaining private and social value, by applying market solutions to social problems.
Today, social entrepreneurship exists in all European countries, employing close to
13.6 million Europeans (Borzaga, et al., 202). To capture social entrepreneurship’s
full spectrum, we should consider that it may take different legal forms. In some
countries, including Italy and Greece, social enterprises’ role and types of activities
are regulated by national law. However, they may also be cooperatives serving
general interests or enterprises, which primarily pursue a social aim (European
Commission, 2015). In any case, we must distinguish social enterprises from
traditional cooperatives and for-profit entities, which engage in business activities
primarily for profits. This is also the case for not-for-profit actors, such as volunteer
organizations and social promotion associations; although they have similar
objectives with social enterprises, they do not perform activities that are
entrepreneurial (Fici, 2015).
Social enterprises are renowned for their innovativeness, and they are oriented
towards the efficient orchestration of available resources to maximize their social
impact. To achieve this, they can adopt distinct types of business models. For
instance, the “entrepreneur support” model provides business support to target
populations, while the “low-income client” model provides services to those who
may not afford it otherwise. Another business model is “service subsidization,”
where products and/or services are provided to an external market to fund other
social programs (Alter, 2007).
Moreover, to avoid mission drift, social enterprises can adopt inclusive business
models (IBMs) and involve the stakeholders concerned in designing adequate
solutions. Alternatively, users of their services and their employees must be
131
encouraged to express their opinions, e.g., through their participation in the
decision-making in special committees (Borzaga, et al., 2020). Interestingly, the
belief that gave birth to IBMs is that human and business development go hand in
hand. According to the UN’s definition, IBMs involve poor populations in both the
demand and supply sides, i.e., as clients, employees, producers, and
entrepreneurs, aiming at both commercial success and development impact
(United Nations Development Program, 2008). Based on this approach, business
models that solely promote viability and competitiveness may not reduce poverty.
Now more than ever, IBMs’ contribution is crucial, considering that around 40% of
the global population, i.e., three billion people, face extreme poverty (World Bank,
2016). Apart from poor populations, IBMs may also target other vulnerable
communities which have limited or no access to basic rights and services, e.g.,
shelter, healthcare, and education. IBMs approach these challenges indirectly, by
engaging members of marginalized groups in economic activities. This way,
disadvantaged people can gain access to income and resources from business
partnerships. Building IBMs requires entrepreneurship; while entrepreneurs come
from diverse backgrounds, they all search for and capitalize on opportunities, when
they set up new companies or introduce changes in existing corporations (United
Nations Development Program, 2008)..
11.3 Defining vulnerable groups
Vulnerability is a term encountered in different scientific fields. In medical and
health science, it is used to measure the risk of harm; economists use the concept
to quantify a system’s stability during unanticipated changes; in social work,
psychology and humanitarian studies, the notion determines the susceptibility of
persons and groups to harm (Wisner, 2016). According to the World Bank, “poverty
is more than inadequate income or human development – it is also vulnerability
and a lack of voice, power and representation” (World Bank, 2001, p. 28).
Vulnerable groups are segments of population who face social exclusion and
require special attention to ensure a dignified livelihood (Hahn, 2011). Based on
this approach, social vulnerability is a concept which derives from respecting
human dignity and fundamental rights. Subsequently, it is a by-product of social
inequalities.
In the labor market, vulnerability represents the difficulty of specific groups to
either access job opportunities or have their rights respected, such as equal pay for
equal work (Pavel, 2011). Apart from poverty, key factors linked with social
vulnerability are age, health status and ethnicity/nationality (Singh, et al., 2014).
To begin with, an important variable to consider when examining barriers for
entrepreneurs is age. While survey data indicate that youth are interested in
becoming self-employed, in reality very few of them are. For instance, in 2018, only
6,5% of EU residents between 20-29 were self-employed (Eurostat, 2019). This fact
indicates an untapped entrepreneurial potential. The main barriers faced by young
entrepreneurs are the lack of entrepreneurship skills and business networks, in
132
addition to their limited work experience and financial resources. Moreover, they
usually also face market barriers, such as low credibility with potential customers
(Halabisky, 2012). Common public policy responses to these issues include grants
and loans for startups, training. mentoring and support of network building (OECD,
2019). As for senior citizens, they constitute a diverse group which faces different
barriers in accessing the labor market. Indicatively, these are the lack of
entrepreneurship skills, limited financial resources and outdated business
networks. Public policy can also have a fundamental role in addressing these issues
through training, improving their access to financing for startups and supporting
network building. An interesting solution is for experienced senior entrepreneurs
to mentor young entrepreneurs so as order to encourage the transfer of
knowledge between generations (OECD, 2019).
Health status is considered as an important determinant in employment since
people with physical or mental disabilities remain insufficiently valued in the labor
market. Findings suggest that they face extensive stigmatization and discrimination
in the labor market, even in countries which have adopted constitutional and
institutional support. This indicates a need for greater collaboration between
policymakers and employers to promote their access to labor opportunities.
Additionally, the role of public perception in relation to disability plays a key role;
thus, public education about health-related issues is a primary method to promote
equity and dignity for persons with disability (Shier et al., 2009).
Other indicators linked with work exclusion or discrimination are race and
ethnicity. Specifically, the economic marginalization of minorities and migrants is
attributed to multiple factors, such as xenophobia, language, and culture barriers,
in addition to limited access to information and political representation (Burton &
Cutter, 2008). Foreign workers are usually employed in construction, agriculture,
and domestic work, where they may be forced to work in the “black market” under
precarious conditions. While many migrants have entrepreneurial experience, they
often encounter greater barriers to entrepreneurship compared to nationals. This
is due to language barriers, cultural differences, a lack of credit history, their
uncertain legal status and eligibility to work and limited professional network.
Moreover, migrants either are unaware of the available support for entrepreneurs
(e.g., training programs and grants) or report that it is inaccessible (e.g., support is
not provided in multiple languages). However, these barriers vary within the
population of migrants (which range from international investors to refugees),
depending on their level of access to human and financial capital (OECD, 2019).
Additionally, a social group whose integration is particularly challenging is the
Roma population. Multiple factors, including social exclusion, limited access to
education and the lack of identification papers prevents them from accessing the
labor market (Pavel, 2011). To be effective, public policy actions must account for
the complexity of migrants’ needs, going beyond business startup support and
aiming for effective outreach and linkage with integration policies and programs
(OECD, 2019).
133
Finally, it is worth mentioning that a group-based approach to vulnerabilities is
helpful to identify people in need of support. However, scholars have underlined
that labelling all members of a social group as vulnerable may be
counterproductive (Pavel, 2011). On the one hand, reliance on group criteria may
further disempower and stigmatize them. On the other hand, it could overshadow
other vulnerable individuals who do not fit into these categories. For instance,
depending on the context, a 30-year-old healthy asylum seeker with no support
network and family in the country of asylum could be more vulnerable compared
to a 70-year-old with mobility issues who travels with his family, because the latter
will be prioritized in accessing state housing opportunities. Similarly, becoming a
woman entrepreneur is less challenging in the EU, compared to third countries
where women could face barriers, due to culture norms, gender inequality and
rights abuse. Indeed, vulnerability is not a static concept to be attached only to
specific groups. Consequently, when approaching vulnerability, we should examine
both the social context and personal characteristics (Mustaniemi-Laakso, et al.,
2016)..
11.4 Inclusion of vulnerable groups through
social entrepreneurship
To make the connection between social entrepreneurship and vulnerable groups,
we need to examine the former’s objectives. Social enterprises can involve
marginalized persons in the production chain and orient their products and
services towards the resolution of social issues that affect disadvantaged groups.
Firstly, social enterprises can choose to hire vulnerable individuals or support
production by vulnerable communities, realized by the so-called smallholders. For
example, “Faire Collection” is a NY based social enterprise founded in 2008, which
hires artisans in Ecuador and Vietnam to create jewelry and sells them on
international markets. Moreover, they offer dignified wages and have introduced
social programs, such as scholarships and interest-free loans (Faire Collection,
2020). Another interesting initiative is “Change Please,” a coffee company launched
in 2015. This social enterprise trains and hires homeless London residents as
baristas, provides them with housing within 10 days of employment and then
supports them in locating future job opportunities (Tbd, 2017). Additionally,
“Cracked It” is a UK smartphone-repair service, operating since 2015 which is
staffed by young ex-offenders or youth at risk of involvement in gangs. This social
enterprise started as a small initiative in east London, where the founder piloted a
phone-repair program in a youth center as an alternative for young people to earn
income (Tbd, 2017).
Moreover, social enterprises may both involve vulnerable communities and aim to
resolve a social issue. This is the case, for example, with “Solar Sister,” a US
registered social enterprise launched in 2010, which provides solar energy to
134
remote communities in Uganda, Sudan, and Rwanda. Their mission is to train and
support female entrepreneurs in East Africa to sell affordable solar lighting and
green products, such as solar lamps and mobile phone chargers, inspired by Avon
cosmetics distribution system. This way they engage local women to sell live-saving
products to their networks of family and neighbors, addressing the lack of access to
electricity for many people in sub-Saharan Africa (Kermeliotis, 2013). Another
successful example is “Graefewirtschaft,” a women-led social enterprise founded in
2009, by both German nationals and migrants which were long-term unemployed.
It employs close to fifty people, migrants, and it runs a wide range of services, such
as provision of meals to schools, support for elderly, work integration and on the
job training for refugees (International Labor Organization, 2017).
Social enterprises may also support smallholders in establishing stronger
negotiation positions in the market, via collective bargaining, access to market
information and capacity building. Inclusion of smallholders in the labor market
improves their efficiency and productivity, which therefore increases employment
opportunities (Dentchev, 2020).
Figure 11.1. Pathways for inclusion of vulnerable groups through social
entrepreneurship
This nourishes diversified income streams for vulnerable groups and the
dissemination of upgraded skills in the market, avoiding their dependence on a
single buyer (Kelly, et al., 2015). Consequently, Figure 11.1 shows the three main
pathways for inclusion of vulnerable groups through social entrepreneurship are
hiring, training, and empowerment of such groups.
11.5 The Contribution of Corporate Social
Responsibility and Circular Economy
In addition to social enterprises, other economic initiatives may also alleviate social
issues and support vulnerable communities. In this section, we will discuss how
Inclusion of
vulnerable
groups
through SE
Hiring
Training
Empowerment
135
corporate social responsibility policies and circular economy are relevant to the
integration of marginalized and disadvantaged groups.
Firstly, Corporate social responsibility (CSR) is a self-regulation form which sets
ethical commitments to corporations and answers society’s expectations from
them (Pavel, 2011). In other words, CSR involves the integration of social factors in
business dynamics to legitimize a company’s existence. Companies also stand to
gain from CSR policies, by incorporating these initiatives in their marketing
approach. Moreover, enhancing the inclusiveness of business activities could also
be the aim of a holistic CSR strategy. Based on the above, there is a complementary
relationship between CSR and social entrepreneurship. The former refers to
business decisions to support social causes, while the latter refers to corporations
that involve vulnerable people and/or provide solutions to social issues (Buendía-
Martínez & Monteagudo, 2020). It is important to note that national laws on CSR
vary between EU member states (European Parliament, 2020). From 2017
onwards, EU based public interest entities (e.g., banks, insurance companies and
companies listed on the regulated market of any EU state) exceeding five hundred
employees are required to disclose non-financial information, including CSR
policies (article 19a of the EU Directive 2014/95/EU). Specifically, they must
disclose their business model, policies pursued, outcomes, risk management and
key performance indicators regarding the environment, social and employee
matters, respect for human rights, anti-corruption, and bribery.
CSR initiatives may be oriented towards responding to urgent situations or
persistent social issues. For instance, following the refugee flow to Europe during
the summer of 2015, the Austrian Federal Railways provided first care and
transportation to refugees, in addition to starting an apprenticeship program for
young refugees, as part of their annual CSR policy (Einwiller, Ruppel, & Strasser,
2019). Similarly, Vodafone Foundation started the “Instant Network Emergency
Response” in 2013 to provide free communications and technical support in areas
affected by natural or humanitarian disaster, such as sub-Saharan Africa, the
Philippines and Lesbos Island, Greece (Vodafone, 2020). CSR initiatives could target
multiple vulnerable groups. For instance, PwC Greece, which offers audit,
assurance, advisory and tax services has been providing pro bono services to the
Muscle Dystrophy Association (MDA Hellas) for more than 10 years (PwC Greece,
2017). Another example is “Hellenic Petroleum S.A.,” one of the largest oil
companies in the Balkans, which donated heating oil to 136 public schools, three
care centers for the elderly and other institutions protecting vulnerable groups, in
2019 (Hellenic Petroleum, 2020).
Moreover, circular economy (CE) is a concept which has gained attention in the last
years. This model fosters the transformation of waste into resources to reduce
negative environmental impact and promotes sustainability. The CE approach
requires businesses to better manage their resources to reduce emissions from
oil/gas extraction and pollution. Specifically, the three basic principles of CE are (a)
preserving and enhancing natural capital, (b) optimizing resources by circulating
products, components, and materials and (c) fostering system effectiveness, by
136
revealing and reducing negative externalities (Heyes, Sharmina, Mendoza, Gallego-
Schmid, & Azapagic, 2018).
CE and inclusive business models meet at numerous points. Both economic models
place individuals and sustainable development at the center. Moreover, a key
factor of their success consists in strengthening creative and innovative capacity at
local level. A social enterprise which adopted CE is “Fairphone,” launched in 2013
in Amsterdam. Contrary to most smartphones which are designed to become
obsolete quickly and be replaced with more advanced models, this company offers
devices which promote repairability and longevity, constructed from responsibly
sourced material and recycled copper and plastics (Rayner, 2019). Another
interesting initiative is “Elvis & Kresse” founded in 2005, in the UK. This social
enterprise designs luxury bags and wallets made from reclaimed materials, such as
decommissioned fire hoses, parachutes, and printing blankets. The company
managed to collect and reuse all of London’s decommissioned fire hoses by 2010
and they donate 50% of their profits to charities (Elvis & Kresse, 2018).
These examples bridge us back to the initial question of how corporate action can
address social vulnerability and other global issues, by promoting sustainability.
CSR policies are a fantastic opportunity for all types of businesses to integrate
social and environmental concerns in their operations and in their interaction with
stakeholders. Similarly, CE looks beyond the current take-make-waste industrial
model, encouraging a systemic shift that builds long-term resilience.
11.6 Conclusions
As discussed in this chapter, social entrepreneurship is a phenomenon with
enormous potential, which is not yet fully fulfilled in Europe. Social enterprises may
significantly impact employment and welfare of vulnerable people. Alternative and
more sustainable models of economic development have emerged, giving birth to
IBMs, adopted by social entrepreneurship and circular economy. While these
economic models are widely diversified, they serve as a vessel for social inclusion,
offering employment opportunities to vulnerable people and addressing social
issues affecting them.
Some scholars have highlighted the idiosyncratic nature of social entrepreneurship
(Jimenez & Pulos, 2012). They claim that conscious consumerism may not address
social issues, such as poverty, inequality, and environmental degradation. More
specifically, they underline that societies may not overcome the negative
externalities of a capitalist economy by engaging in more capitalism. Moreover,
they refer to the “halo effect” of social entrepreneurship and CSR policies, i.e.,
when a company’s positive social impact influences consumers’ perceptions about
the former’s overall activities, even when they have little or no information about
them. Despite that, the inspirational role of social entrepreneurship and IBMs is
undoubtedly a starting point for the corporate sector to become more inclusive.
137
Economic inclusion in the labor market refers to the equality of opportunities,
regardless of gender, age, education level and socioeconomic status. Indeed,
integration of disadvantaged groups in business activities is far from an easy task.
The same applies for resolving deep-rooted social and environmental issues. The
success of IBMs depends on the support received from states and consumers, in
addition to the quality of their products and services (Dentchev, 2020). To
successfully integrate smallholders into value chains, social enterprises need to be
viable, i.e., individuals and companies should purchase their products, not only due
to their story, but also due to their quality (Kelly, Vergara, & Bammann, 2015).
138
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Social Entrepreneurship in
the Refugee Context
Chapter 12
Photo by Levi Meir Clancy on Unsplash
Savvatou Tsolakidou,
National and Kapodistrian University of Athens, Greece.
143
Chapter 12: Social Entrepreneurship in the
Refugee Context
Aim
Social entrepreneurship is well-placed to promote social cohesion and
empower vulnerable groups, including beneficiaries of international
protection, i.e., refugees and beneficiaries of subsidiary protection. After
displaced populations reach the country of asylum, multiple factors, including
the lack of documentation, the absence of a support network, the limited
knowledge of the local language, and discrimination, hinder their integration.
While they bring skills and experience from their country of origin, they may
not always match them with professional opportunities in the host countries.
This chapter analyzes how social enterprises may serve as a tool for inclusion
in the refugee context. We review the vulnerability factors and the existing
barriers for migrants to access the labor market. In addition, we present the
work of social enterprises which employ or target refugees in Greece and the
UK.
Expected Learning Outcomes
► To understand how social entrepreneurship promotes social cohesion
in the refugee context
► To review the vulnerability factors
► To define existing barriers for migrants to access the labor market
► To learn about social entrepreneurship's role through the work of
social enterprises which employ or target refugees in Greece and the
UK
Keywords: Social Economy, Social Entrepreneurship, Forced Displacement,
Refugees, Inclusion Barriers, Labour Market Integration.
12.1. Introduction
The recent global financial crisis has increased unemployment rates and social
exclusion in many states. In Southern Europe, this was coupled with the
unprecedented flow of immigrants and refugees to Europe from 2015
onwards. Specifically, between 2014 and 2019, there were 1,243,600 arrivals
in Greece and 659,600 in Italy by sea and land (UN Research Institute for Social
Development, 2020). To this date, the EU's response to the continuous
migration flows remains challenging. According to the legal provisions
introduced by the Common European Asylum System (European Commission,
2014), host countries are responsible for the reception and accommodation of
asylum seekers, the examination of their asylum claims, and the integration of
those recognized. On the one hand, the needs of migrants are heterogeneous.
On the other hand, governments have limited national resources available to
provide appropriate services to migrants (UN Research Institute for Social
Development, 2020).
“Social
entrepreneurship
can support the
integration of
vulnerable
groups”
144
As explained in the previous chapter, social entrepreneurship can support the
integration of vulnerable groups, including beneficiaries of international
protection. In this chapter, we will analyze vulnerability in the refugee context,
the integration barriers, and how social enterprises may serve as a tool for
inclusion. In addition, we briefly present the work of social enterprises in two
countries; Greece, which hosts thousands of refugees, and the UK, which has a
long history of social entrepreneurship.
12.2 Vulnerability factors
Understanding vulnerability in the refugee context requires the review of some
key terms. Populations on the move are referred to as refugees, immigrants,
migrants, and beneficiaries of international protection. Firstly, a "refugee" is any
individual who is outside his/her country of origin and is unable to return or
enjoy its protection owing to a well-founded fear of being persecuted for
reasons of race, religion, nationality, membership of a particular social group or
political opinion (UNHCR, 1995). This is the key difference between refugees and
immigrants who continue to enjoy the protection of their own country when
abroad, e.g., for purposes of employment or study purposes. In comparison, the
term "migrant" is broader, describing any person who has left his/her country
(UNHCR, 2011). When we analyze vulnerability in the refugee context, we refer
to forcibly displaced populations, meaning asylum seekers and those recognized
as "beneficiaries of international protection."
Forced displacement has scaled up, leading to more than 100 million persons
becoming displaced during the last ten years due to armed conflicts,
indiscriminate violence, genocides, and other human rights violations (UNHCR,
2020). Based on the above, the push factors behind international migration
have not weakened. In addition, millions of people are expected to be displaced
due to climate change and other global threats (Gurría, 2016).
Forcibly displaced populations are considered vulnerable groups for a wide
range of reasons which often overlap. On the one hand, situational vulnerability
refers to the conditions both prior to fleeing, i.e., economic deprivation or lack
of access to fundamental human rights in the country of origin, and after, i.e.,
en-route and in the country of destination. Migrants often travel through
irregular routes, which expose them to exploitation and abuse by smugglers and
corrupt officials, in addition to life risks from hazardous border crossings. After
they reach the country of destination, the lack of documentation, the absence
of a support network, the limited knowledge of the local language, and
discrimination are factors that enhance their vulnerability. While they bring
skills and experience from their country of origin, their education and
credentials are not always recognized in the countries of asylum, meaning that
145
they may not match their skills with the professional opportunities offered. On
the other hand, individual vulnerability relates to the characteristics or
circumstances of displaced persons. Specific groups are particularly vulnerable
to violations of their rights, such as children (especially those who are
unaccompanied or were separated from their families), the elderly, people with
physical or disabilities or chronic illnesses, survivors of torture or trauma, or
trafficking (UNHCR, 2017). After reviewing the vulnerability factors, it is also
important to examine the existing barriers for migrants to access the labor
market
“Forced displacement has scaled up, leading to
more than 100 million persons becoming
displaced during the last ten years”
12.3 Barriers to labor integration
According to the Common European Asylum System, asylum seekers must be
granted "effective access" to the labor market no later than nine months from
the date when the application for international protection was lodged, provided
that a decision has not been issued and the delay is not attributed to the
applicant. After they become recognized beneficiaries of international
protection, they enjoy equal access to the labor market as nationals and EU
citizens and shall receive integration support from the host state.
However, despite these legally binding provisions, unemployment rates of
migrants in the EU are high, while workplace inclusion remains low. Work
opportunities and integration support provided to asylum seekers and refugees
vary between member states. This is the case because EU legislation may not
prevent practical obstacles, such as administrative, institutional, economic,
education-related, and cultural challenges. Also, said the legislation does not
specify how access should be provided to asylum seekers and recognized
beneficiaries of international protection.
Regarding asylum seekers, EU states have imposed certain restrictions on the
type of work and conditions to access the labor market. These restrictions apply
to (European Employment Policy Observatory, 2016):
► the number of days asylum seekers can be employed (e.g., in the
Netherlands, asylum seekers could work for a maximum of 24 weeks a
year),
► the type of occupation (e.g., in Cyprus, asylum seekers may only work in
unskilled sectors, such as agriculture, fisheries, manufacturing, waste
management, wholesale trade, and repairs),
146
► the access to Public Employment Services (e.g., in Germany, job centers
perform a priority review, examining whether advertised positions could
be filled out first by either a national or a foreigner with a secure
residence permit) and
► The issuance of work licenses by employers (e.g., in Malta and Cyprus).
Although this is not a legal restriction per se, it is a deterrent due to its
short-term nature and administrative procedure.
► Even after asylum seekers are recognized by the host state as
beneficiaries of international protection, barriers continue to exist
regarding their access to the labor market. These are (European
Employment Policy Observatory, 2016):
► The limited or no knowledge of the local language. This is also true for
beneficiaries of international protection who received language training
from the host country. Applicants typically need to move beyond a basic
understanding of the language to be accepted in high-skilled job
opportunities.
► The high levels of unemployment in certain countries. Specifically, the
recent economic crisis increased work insecurity and caused additional
obstacles and competition in entering the labor market for all citizens,
including beneficiaries of international protection.
► Discrimination from employers and society towards non-nationals. In
some cases, this also escalates to racist and xenophobic behavior
against beneficiaries of international protection (Hellenic Open
University, 2019).
► The low level of work qualifications and skills. Moreover, education
opportunities and vocational training specifically targeted to
beneficiaries of international protection and their needs have not been
established by all states.
► The limited social networks of beneficiaries of international protection
can be highly valuable to their integration both in society and in the
labor market.
Consequently, as explained in the following section, social entrepreneurship in
the refugee context is valuable in order to facilitate the social and labor
inclusion of asylum seekers and beneficiaries of international protection.
12.4 Advantages of social enterprises
Social enterprises can complement state actions regarding migrants' integration
by using private sector mechanisms (Ashkar, Auerswald, Samra, & Schoop,
2016). Since the former's modus operandi is more flexible compared to the
public sector, they better respond to the changing economic and social needs of
migrants. Moreover, social enterprises boost local economic circuits by offering
147
better economic and working conditions for refugees and natives, even during
economically challenging times (UN Research Institute for Social Development,
2020). Interestingly, following the 2015 refugee crisis, several EU social
enterprises which already offered services to vulnerable people extended their
target group to migrants and refugees. New social enterprises were established,
in some cases by migrants and refugees themselves, e.g., in Italy
Additionally, social enterprises are more democratic and inclusive compared to
"traditional" private sector businesses. This allows them to gain the refugee
communities' trust and provide tailor-made services for those with different
needs. For instance, in Heraklion and Bergamo cities (in Greece and Italy),
services provided by social enterprises varied from emergency relief and health
and helpline services to in-kind support such as temporary accommodation,
food and clothing, and medication. Also, social enterprises can reduce tensions
between refugees and the host community. As documented in Italy, when new
enterprises operated by refugees benefit from links with local organizations, this
encourages dialogue and integration times (UN Research Institute for Social
Development, 2020). Focusing on social enterprises that promote the
integration of refugees, we shall review the work of social cooperatives in
Greece and the UK. We will present both existing enterprises which extended
their work to refugees and enterprises formed after the 2016 migration crisis.
Social enterprises in Greece mainly operate in sectors that are labor-intensive
instead of capital-intensive (British Council, 2017). An existing social enterprise
that expanded its target group following the refugee influx is "Prasines
Diadromes," established in 2012 in Thessaloniki, North Greece. This social
enterprise promotes sustainable green jobs and accessibility, in addition to
bicycle renting and repairing services. In 2016, it extended its educational
programming for physical activities to migrant children and women through an
action titled "learning to ride safely," implemented together with the
municipality and supported by private donations of bicycles (Greenways).
Another example is "Artistic Partnership in Community's Creative Opening,"
which started as a volunteer movement of artists in 2013 and was established as
a social enterprise in 2017. Its vision is the diffusion of social exclusion and the
promotion of equal opportunities to re-integrate excluded vulnerable groups
through art activities, including ex-prisoners, migrants, the homeless, disabled
groups, and the unemployed (APICCO, 2020).
Moreover, "Emantes" social enterprise was founded in July 2018 by volunteers
involved with refugee and feminist groups. Its two basic objectives are the
provision of psychosocial support for LGBTQI+ migrants and raising awareness
about the community's issues. Emantes' operations rely exclusively on the
voluntary work of its members and on their collaboration with volunteers from
Greece and abroad (ACCMR, 2020). Another example of a successful social
enterprise is "Syllogeio," launched in 2019 in Athens city, to offer learning
opportunities at the bare minimum cost. It provides Greek lessons to students
of secondary education who study for the national exams, in addition to
148
children with special education needs and adult refugees and asylum seekers in
Athens city (Syllogeio).
Furthermore, "Nest" is a social enterprise that aims to promote social
entrepreneurship in Greece and social change through innovative business
ventures. One of its many interesting projects is the "Social Fashion Factory"
(SOFFA), a cooperative of fashion designers and professionals that supports
work integration and micro-entrepreneurism in the sustainable fashion of
refugees, survivors of human trafficking, and unemployed persons. SOFFA is
operating within the fashion industry by tackling environmental crises and
exploitation of resources, in addition to offering fair wages and working
conditions. The majority of SOFFA's shareholders are refugees (60%) and
unemployed Greeks (30%), and already in May 2018, SOFFA produced and sold
nearly 11,000 products (Dimitropoulos, 2018). Moreover, Nest has also created
"Refergon," an online which matches refugees with employment opportunities
in businesses and social enterprises, aiming at breaking barriers to
employability. The platform identifies skill-building and vocational training
opportunities for unskilled refugees offered by NGOs and academic institutions
(SOFFA).
As for the UK, there are various social enterprises that support refugees and
asylum seekers to integrate into society. One of them is "Clear Voice," operating
since 2006, which offers professional interpreting services in over 200 languages
by telephone or face-to-face translation. This social enterprise encourages
recruitment from minority groups and supports charitable work for victims of
displacement and exploitation through its profits. Similarly, "NEMI Teas," a
London-based company launched in 2016, provides job opportunities to
migrants in commercial roles (e.g., sales, marketing, and distribution) by
appointing them in tea stalls across food markets and festivals. Moreover,
"Spring Action Cleaning" hires refugees residing in Coventry. This enterprise
which offers cleaning services was launched in 2017 by the Coventry Refugee
and Migrant Centre in an effort to support migrants' future employment and
confidence building (Supply Change, 2020). Another interesting social enterprise
is Hackney-based "Bread and Roses," founded in 2016, which has started a
seven-week floristry program for refugees. Through this initiative, they aspire to
create a forum for women to be creative and practice their English skills (Bread
& Roses). The review of the above social enterprises showcases that, while they
operate in diverse industries, they can be equally effective in promoting social
inclusion and providing work opportunities to beneficiaries of international
protection.
149
12.5 Conclusions
Social entrepreneurship remained resilient during the economic crisis and
contributed to the integration of displaced populations. However, it is true
that it remains small in terms of personnel, production, and influence in the
EU economy. Consequently, as emphasized by the UN, states need to legally
recognize social entrepreneurship and provide incentives for their
establishment. Given that social entrepreneurship can support the
implementation of inclusion policies, said policies should actively promote
social enterprises' access to markets and financial resources. Raising public
awareness about the role and activities of social entrepreneurship is also
crucial, along with including them in policymaking (UN Research Institute for
Social Development, 2020).
Finally, it is important to note that the number of refugees who become
entrepreneurs in their host county significantly varies between states. This
depends on both the culture and the regulatory environment in the country
of asylum (OECD, 2019). Interestingly, a survey focusing on Syrian refugees in
3 countries (Austria, the Netherlands, and the UK) indicated that, while 32%
were business owners in their home country, only 1.5% started a business in
their host country, and less than 12% intended to become entrepreneurs
(Deloitte, 2017). As mentioned, displaced populations face multiple barriers
when accessing work opportunities linked to language and cultural barriers.
Moreover, it should be noted that refugee entrepreneurs usually operate in
markets with low entry barriers, such as retail, wholesale trade, and
Photo by Matteo Paganelli on Unsplash
150
restaurants. Since these markets have many players, they also have excess
supply, which leads to low profit and limited growth opportunities.
Moreover, when refugee entrepreneurs focus solely on niche "ethnic"
markets, this limits their income since said markets are typically small. For
this reason, OECD has underlined that an important factor for the success of
refugee entrepreneurs is their access to mainstream markets since they are
more profitable (OECD, 2019). Given that social entrepreneurship is
renowned for addressing society's most pressing issues, its problem-solving
approach is necessary to address the migration crisis and the obstacles
mentioned regarding the integration of vulnerable populations, including
displaced populations.
151
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153
Social Entrepreneurship at
the Bottom of the Pyramid
Chapter 13
Claudia Alba Ortuño1, Romel Brun2
1Vrije Universiteir Brussel, Belgium
2Universidad Católica Boliviana, Bolivia.
Photo by Jackson David on Unsplash
154
Chapter 13: Social Entrepreneurship in
the Bottom of the Pyramid context
Aim
This chapter aims to explain the Bottom of the Pyramid (BoP) concept and
evolution since its introduction in 1998. We review the relationship between
(social) entrepreneurship and BoP through the years, challenges,
opportunities, and new tendencies, along with the emerging characteristics
of Frugal Innovation.
Expected Learning Outcomes
► To gain a deep understanding of the BoP concept
► To understand the BoP context
► To identify the difference in Challenges and Opportunities of BoP
entrepreneurs
► To determine the characteristics of Frugal Innovation
Keywords: Bottom of the Pyramid, Social Entrepreneurship, Frugal
Innovation
13.1 Introduction
The term “Bottom of the Pyramid” was introduced by Prahalad and Hart
(2004) to represent the people who live in poverty. Different organizations
try to quantify the number of people belonging to the Bottom of the Pyramid
(BoP) using parameters such as their acquisition power or daily income (IDB
Group, 2019; Prahalad & Hart, 2004). For example, according to Casado and
Hart (2015), anyone living with less than US$8 per day belongs to the BoP,
but the most used reference is the one of Prahalad, being part of the BoP,
the people with less than 2US$ per day. No matter the amount, according to
Oxfam -an international organization focusing on alleviating global poverty-
the eight wealthiest billionaires in the world own the same level of wealth as
half of the earth’s population, and each day we have more people getting
into poverty. Besides the limited income, the BoP has a specific income that
differentiates them from other groups.
13.2 The BoP Context
The BoP constitutes the portion of the world with the lowest income.
According to studies, this is around 80% of the world’s population (Voola &
Voola, 2019). However, using an approach focus on income to define poverty
fails to recognize the complexity of poverty as it ignores different problems
“BoP was introduced
by Prahalad and
Hart (2004) to
represent the
people who live in
poverty”
155
that are closely related (Chmielewski, Dembek, & Beckett, 2020). Besides
poverty, BoP context characterizes for being heterogeneous across multiple
dimensions (Ted & Hart, 2011). For example, it is expected that these
economies are also dominated by giant multinational corporations, and
therefore small enterprises run by the BoP population find it challenging to
compete. At the BoP, a formal enterprise is expensive, bureaucratic, time-
consuming, and with no benefits; therefore, most ventures are part of the
informal economy (Ted & Hart, 2011).
As the population is poor, there are normally no markets and access to
international markets is complex as the knowledge and procedures are
unclear (Seelos & Mair, 2011). This is connected to the informality of the
enterprises which cannot export their products. The connection of BoP
enterprises to the global market is weak (Gupta & Khilji, 2013), and although
the internet can be a good channel, some places lack internet connection, or
poverty limits their access to computers or/and their capacity to use them.
The weak infrastructure (Karnani, 2006) is not only reflected on the internet
connectivity, but also to limited access to electricity, water as well as to
metropolitan areas.
These differences give the BoP population a different mindset in which
priorities and needs are different to other groups of people. Someone with
no experience in poverty might have challenges understanding their reality,
therefore, the approach with them needs to take into consideration their
context. The weak regulatory institutions have no capacity to educate people
or enforce the respect of laws and regulations. Patents are not respected and
reduce the incentive for people to create something new. Resource scarcity
can be most commonly noted in electricity, water, internet, and human
resources (Goyal, Sergi, & Jaiswal, 2016). The access of BoP population’s
access to quality education is limited. In some cases, children do not go to
school because they need to work, and for those who are able to attend
classes their learning is limited to writing and reading. Finding qualified
human resources in these areas is challenging.
13.3 The Evolution of the BoP Concept
Traditional business is based on maximizing shareholder value and
addressing social issues to governments and nonprofits (Voola & Voola,
2019). However, government and nonprofits had a limited impact regarding
social problems. This limitation led to the emergence and evolution of Social
Entrepreneurship as an alternative to creating socio-economic impact at the
BoP (Goyal et al., 2016). Social entrepreneurs question the assumption of
models based exclusively on economic goals and promote models in which
the economic and social goals have equal relevance for the success of the
company.
156
The first attempt of enterprises reaching the BoP market is known as BoP 1.0
(Prahalad & Hart, 2004) and focuses on adapting current products for the
poor; for example a multinational that produces a new version of their
product in a small version that can be sell at a lower price. The logic behind
BoP 1.0 is that the BoP has a low power of acquisition at an individual level.
Still, as they are so many (4 billion), it becomes an attractive market for
international companies (Karnani, 2008). This attempt has been highly
criticized as multinationals approach the poor population to increase their
profit.
In order to fight the the criticism, a second attempt of the BoP concept was
proposed. A new attempt to serve the BoP must be more than providing low-
cost products. The BoP 2.0 focus (Simanis, Hart, & Duke, 2008) changed from
selling to the BoP population to co-create with them. This attempt proposes
multinationals to change their role of power and become enablers of the BoP
entrepreneurial ecosystem by co-creating with the BoP population products
and services based in their own necessities (Gupta & Khilji, 2013).
BoP 3.0 (Casado-Caneque & Hart, 2015) has a broader approach as it also
includes environmental concerns into the business model (Dembek, York, &
Singh, 2018). BoP 3.0 also proposes that multinationals should share their
wealth with BoP communities to compensate for all the negative impact that
they have (Gupta & Khilji, 2013). Lastly, BoP 4.0 proposes that is not only
about co-creating with the BoP but taking into account and building in what
the BoP already has to complement the knowledge of traditional business
that we already have in the western world (Gupta & Khilji, 2013), see Figure
13.1.
Figure 13.1. The evolution of the BoP concept, source: the author, 2022
BoP 1.0
Adapt products
and services
from the
develop
markets for the
BoP markets
BoP 2.0
Engage the BoP
population in
the co-creation
of goods and
services
BoP 3.0
Support the
BoP population
focusing in a
community
well-being
BoP 4.0
Build in the
current
strenghts of the
BoP context
157
13.4 Challenges and opportunities of the
BoP
Social enterprises have numerous challenges and opportunities as presented
in previous chapters. These challenges increase for social enterprises in the
BoP. The BoP market is complex as costumers have a low acquisition power,
competence is mostly informal and does not respect legal restriction as
patents, limited government support, and lack of infrastructure and
resources (Goyal et al., 2016). Regarding resources, the lack of highly skilled
professionals is a significant challenge for social enterprises which aim to hire
from the BoP. Consequently, the low level of education found at the BoP is
challenging to innovate or develop disruptive enterprises that could compete
at a global level.
The opportunity that this challenge provides is that the BoP requires a
multitude of scalable market-based innovations that can solve these
challenges (Goyal et al., 2016). This context has so many unsolved social
problems that the opportunities for social enterprises are countless.
However, a firm aiming to develop an enterprise at the BoP, needs to
understand the context and adapt to these conditions. It is not about taking
functional models of the western world and replicating them at the BoP. This
will not work (London et al., 2014).
If an external firm wants to enter the BoP markets, it risks being perceived as
an attempt to take advantage of the BoP population (Voola & Voola, 2019).
An alternative for this is that external firms initially look for allies in the local
market to facilitate their connections, but this opportunity comes with a
challenge. As BoP markets are usually non-existent or very small, finding the
right local partner might be challenging (Seelos & Mair, 2011). It is also
essential to understand that doing business in the BoP market implies making
poverty a part of the business reality and building around it (Dembek,
Sivasubramaniam, & Chmielewski, 2020).
A different challenge to consider when working with the BoP is the
vulnerability of these communities (Dembek et al., 2020). Social Enterprises
need to consider this in their development to avoid undesirable value
destruction. Dembek and York (2018) propose to work in changing the
poverty mindset to prevent the destruction of value. This is also related to
using a highly collaborative approach to be aware of the BoP population
concerns.
The BoP conditions also lead to new tendencies to focus on their needs and
resources. One that has been important in the last years is their innovations,
which do not work with new technologies or expensive machinery but with
limited resources and sometimes ancient technologies. These innovations are
called frugal innovations
158
13.5 Frugal Innovation
Frugal Innovation is originated in emerging markets. The meaning is fuzzy,
but the main idea is that products and services need to be developed to
satisfy these markets’ special needs and can be bought with the resources
that consumers of these markets have (Weyrauch & Herstatt, 2017). In
emerging markets, there is a high level of BoP population. In recent years,
this concept is also used in developed economies, which is used as a synonym
for reverse innovation. There are three criteria that innovations need to fulfill
to be frugal: substantial cost reduction, concentration on core functionalities,
and optimized performance level (Weyrauch & Herstatt, 2017).
A substantial cost reduction characterizes frugal innovation, usually at least
33% less than conventional products or services. This cost reduction must be
reflected in the customer's perspective. A decrease in quality or performance
should not accompany this cost reduction. Cost reduction can happen in
different ways, such as by reusing old materials, using locally available
materials, and eliminating unnecessary product features (Hossain, 2018). The
second criterion is the concentration on the core functionalities of the
innovation. The new product or service targets user requirements by
providing higher customer benefits. Frugal innovation solve the most
essential needs and minimizes the use of resources. These criteria also aim to
make the products easy to use and with a lower impact on the environment.
The third criterion is the optimized performance level. This is related to the
second criterion of core functionalities because there must be an
examination of the levels of performance and quality to satisfy the essential
needs with no waste of resources. The performance level must be according
to the context, because emerging markets have different needs that might
not be the smaller tools, or the ones connected with internet but the ones
that work better for them in their places. These criteria might vary based on
the needs and conditions of different markets. Overall, frugal innovation can
happen at an individual, group or societal level (Hossain, 2018). Usually,
frugal innovators live and are close to their target market, therefore, they
understand better the needs and the resources available, which renders
these markets challenging for multinationals.
13.6 Conclusions
The purpose of this chapter was to present the definition of the BoP and its
context. We also reviewed the historical relationship between social
entrepreneurship and the context of the BoP. It is expected that the reader
will be able to identify the differences in the challenges and opportunities for
entrepreneurs located at the BoP and how the avenues presented in this
chapter can lead to the emergence of frugal innovations.
159
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Community Media
Case Studies
Chapter 14
Figen Algül, Marmara University, Turkey.
Photo by Fringer Cat on Unsplash
162
Chapter 14: Challenges in Social
Entrepreneurship
Aim
In this chapter, the reader is expected to gain awareness about the
relationship between social entrepreneurship and community media. To
this end, definitions and examples are presented in this chapter, which
will allow the reader to understand what community media is, its
historical process, and how social impact can be promoted through
these media. Additionally, some cases are presented as examples where
the greatest beneficiary has been social entrepreneurship.
Expected Learning Outcomes
► To gain awareness of the relationship between social
entrepreneurship and community media.
► To gain a deep understanding of the main concepts related to
community media.
► To gain information about the historical process of community
media.
► To gain awareness about community media by giving case
studies from European Union countries.
Keywords: Social Entrepreneurship, Community Media, Community
Radios
14.1. Introduction
Social entrepreneurship focuses on the marginalized and the poor,
applying practical, innovative, and sustainable approaches to benefit
society. This approach distinguishes social entrepreneurs, people, and
organizations who devote their lives to social development. In this
context, community media has a social impact. As an alternative tool to
public and commercial media, they have an important place in the
participation of citizens. They provide information and voice access to
communities and facilitate community-level discussion, sharing of
information, and input in public decision-making. Community media
encourage social inclusion and foster cultural and linguistic diversity
(UNESCO, 2011).
“…Community
media has an
important place in
the participation of
citizens”
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Studies in community media first emerged from efforts to "democratize" the
media. In 1976, UNESCO established a commission to examine the questions of
international communication, especially the inequality of information flow
among first and third-world countries. The Latin American academics who were
influential in the debates argued that the underdevelopment of the south (the
third world) partly stemmed from the unequal information exchange coming
from the north. The UNESCO debate aimed to establish a "New World
Information and Communication Order (NWICO)." The McBride Report, the
result of the discussion, recommended that south-to-south communication be
developed and more democratic national politics, including an ethics law about
the mass media, should be implemented. Hence the terms "access,”
"participation," and "self-governance" appeared as democratic media indicators
within this context. When the United States of America, in 1984, withdrew its
membership and finance from the UNESCO communication movement, the
debates were interrupted (Rennie, 2006).
Societies and groups use community media with shared ideas, characteristics,
interests, or ownership (Possi, 2003). Community media ensures media
plurality, freedom of speech, diversity of content, and representation of distinct
groups and interests; they encourage public and gender-balanced access,
support for cultural diversity, self-governance and media literacy, open dialogue
at the local level, transparency, and a channel of communication (Milan, 2009).
The community media is used for mobilization, sensitization, and education for
holistic development. Community media are small-scaled,non-profit, open and
accountable to the community which they serve, essentially run by volunteers,
open to the participation of the community members in terms of programme-
making and governance, it enables participation and access in terms of
integrating the non-professional media producers into the work, and it
contributes to the social change. Community media can serve communities of
interest, geographical communities, and cultural communities.
The crucial role of the community media is to bring tolerance and pluralism to
society. Community media provides public broadcasting services and presents
accessibility for all. On the other hand, it reproduces and represents the
common, shared interests. In this sense, the community media offers a tool of
empowerment for marginalized communities. Under the framework of all these
features, the community media constitutes a separate subgroup within the
media sector (European Parliament, 2007).
This subgroup is an alternative to the established processes and conditions of
media production; it is free from the intervention of the state, market actors,
and multilateral institutions; the local communities produce it in their languages
about issues which they assume significance concerning their own needs, and
for their consumption. Thus it is also an alternative to the dominant media as to
the content (Saeed, 2009). The community media presents news and
information appropriate for the needs of the community members; it integrates
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its members in public debates and contributes to their empowerment in social
and political aspects. In general, the ownership and control of the community
media are shared by the residents, local administrations, and community-based
organizations and the content is considered and produced locally (Jankowski,
2003).
The community media establishes counterbalances against concentration of
media power in the hands of a few numbers of people and against the
homogenisation of the cultural content. Community broadcasts present
alternatives for endogenous development. It makes programs based on specific
needs such as health, education, employment, gender, peace, and environment.
Community media uses the language (languages) of the community members. It
accepts the positive, moral and cultural values of its community. The community
media is expected not to broadcast sexists or biased programs against the
disabled and minority groups. The community media may be an important tool
for the disadvantaged members of the community to become active
participants of society and participate in essential debates for them. The general
sector has also been an educational basis for its volunteers to become future
media professionals. (European Parliament, 2007) And distribution of the
content may be by cable television infrastructure or by electronic networks like
the Internet (Jankowski, 2003).
Funding of the community media is not essentially commercial though it may
include total budget company sponsorship, advertisements with limited
numbers and kind, and by governmental subsidies (Jankowski, 2003). In some
examples, they do not broadcast advertisements due to editorial preferences
and as they do not constitute an attractive target for the advertisers. However,
lacking stable financing resources, like subsidies governed by the state,
endangers their existence (Milan, 2009). And in some cases, some are against
receiving advertisements and state support on an ideological or pragmatic basis.
In administrative terms, they have a broadcasting board or boards of
administrators. In other words, community media is people's media made by
the people for the people. These services influence public opinion, create
consensus and enhance democracy.
NWICO advocates point out the Bolivarian miners' radio which appeared at the
end of the 1940's as the first example of the democratic community media. This
first appearance was a protest movement in a tin mine (Rennie, 2006). While
community media developed in 1950's in North America, in West Europe it
appeared in the 1960's and 1970's (European Parliament, 2008). According to
the community radio operation definition accepted by the World Association of
Community Radio Broadcasters European Branch (AMARC Europe), community
media is called the popular radio, educative radio, miner's radio or peasant
radio in Latin America. While in Africa, references are made to local rural radio
or bush radio, in Europe, in general, it is called as the union radio, free radio,
neighborhood radio, or community radio.
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While the Asian talks about radio for development, in Australia, it is called
Aborigine radio, public radio, and community radio (Servaes, 1999). Community
media is seen as a natural part of contemporary democracies in general, and it is
considered a field of variety and values to which the market and state cannot
reach. Community radio was created by the belief that civil society needs
communication platforms. Thus, community media and civil society are
interdependent in this sense. Especially the pirate broadcasts, which do not
have commercial characteristics, caused the community media to appear. As it
is observed in the European context, community broadcasting, in many
examples, was established due to the continuous pressures from community
groups rather than directives inspired by the state. The community media can
present alternatives to the communication agenda established by the dominant
social-political or even cultural order by contributing to the political
emancipation and democratization processes. Therefore, creating change in
living conditions of the poor, marginalized, deprived, or oppressed communities.
Community media contributes to development's social and cultural dimensions
by presenting channels for development, social and political empowerment, and
realizing citizens' rights (Milan, 2009), see Figure 14.1.
Figure 14.1. Connection in Between the Community Media and Human Development (Milan, 2019)
As seen above, it seems that the contribution of the media to social initiatives has been evident. Likewise, it can
be understood that great social movements have been promoted by radio and television, so their historical
impact is also noteworthy. Recent literature suggests that social entrepreneurship, understood as a business
activity that seeks to solve a social problem, can benefit greatly from the media since they have contributed not
only to human development, but also to the support of social movements that have promoted social justice,
peace, and freedom of expression.
166
Evidence of the above can be found in the growing number of digital social ventures that seek to address a social
issue using the media. Next, in this chapter we present some cases of social entrepreneurship that benefit from
the media either to maximize their impact, or to promote a social cause as well.
14.2 Community Media cases from
Bulgaria
The case of MEDIA CAFÉ
Media Type: Independent Youth web portal
Founder: "Viscomp" company, Founding date: 2007
Strategy: MediaCafe.bg is a new-generation independent youth web
portal. Through the portal, the Media Cafe team represents the idea of
"independence"; because political organizations or existing circles do not
stand behind "media" and "coffee". Media is us, cafeteria means
everything that makes us noticed and comments on it with you". Because
Media Cafe.bg policy is to remain neutral against political intrigues and
false political profiles, users will not find criminal news or yellow
journalism on this portal.
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The message Media Café wants to announce to young people is: "Wake
up your mind", because they are trying to activate the whole community
first and pay more attention to the things that matter. On MediaCafe.bg
you can find guidance and news on topics that excite young people and
youth organizations in Bulgaria - internships, career and business
entrepreneurship at the end of their university studies. Cultural events
are the main priority of Media Café's young team, and this is the place to
take you to the contemporary art world, theater performances and film
productions that can be found in Bulgaria. MediaCafe.bg is useful for
anhelpfulho wants to refresh their daily life. The Youth Portal
mediacafe.bg provides opportunities for young people to express their
thoughts and develop internship programs.
Publication Frequency: 7/24
Languages: Bulgarian only
Website Link: http://mediacafe.bg
Social Media Links:
https://www.facebook.com/mediacafe.bg
Content: The portal is divided into the following sections:
► Activities: Young people can find information about events in
their city / town.
► Business and Entrepreneurship sections: these departments are
useful for all young entrepreneurs, IT professionals and faculty.
► Career and internship
► Culture and Art
► Education
► Analysis
The case of ORV MEDIA
Media Name: ORV MEDIA
Media Type: Information web portal www.orvmedia.com, Radio ORV
and ORV + video platform.
Founder: ORV Media NGO, Date of Establishment: 2005
Strategy: ORV MEDIA started its activities in 2005. Initially, the ORV
team worked on the live broadcast of their ORV Internet radio. They
then created an information website and video section (ORV +). ORV
MEDIA's main objectives and activities are to promote the
development of journalism, audiovisual arts, youth activities, and
volunteer work. The organization's activities are fully committed to
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the inclusion of young people. The main purpose of the ORV team is
to support young artists and provide them with a platform to express
themselves, their talents, and their activities. Over the years, ORV
MEDYA has partnered with various local, national, and international
projects. ORV MEDIA also offers a variety of services to its customers.
Target Groups: Young people, young artists, youth professionals, and
organizations.
Stakeholders: Facebook friends and followers of 10119 ORV media
Youtube followers 1,54 B.
Publication Frequency: 7/24
Languages: Bulgarian only
Web Site Link: http://www.orvmedia.com
Social Media Links: https://www.facebook.com/orvmedia
https://www.youtube.com/channel/UCIhBdMP3pXMhwJgWHslixZg
Content: ORV media provides information to Bulgarian youth
through several attractive sections:
1. "Youth news" with useful information on voluntary initiatives in
Bulgaria and abroad, young people's sports or educational
achievements, festivals, and competitions for young people in
various fields.
Special news section called.
2. Projects and initiatives section - ORV media, organizer of many
projects and initiatives and its participant, among which:
► ORV Academy - the art academy for street
artists(http://www.orvmedia.com/index.php/projects/353-
orv-academy );
► "Youth MediaLab" - The international youth project itself,
youth activities and It is dedicated to producing audio,
video and text materials for the promotion of its
organizations.
http://www.orvmedia.com/index.php/projects/348-
proekt-youth-medialab );
► - There are TV and radio broadcasts called "No Limits" and
many more.
Other: ORV MEDIA has a well-developed client network that
includes SMEs, public institutions and organizations, and NGOs,
and its activities are based on special events, products, services,
etc. It ensures that they secure through the revenues from their
advertisements.
169
The case of YOUTHHUB
Media Name: YOUTHHUB
Media Type: Youth NGO web portal
Founder: YouthHub NGO, Date of Establishment: 2016
Strategy: YOUTHub is a private, non-governmental organization
based in Sofia Bulgaria. YOUTHub.bg was established on
September 1, 2016. Its main aim is to help young people in
Bulgaria to serve as an online youth platform where they can find
all kinds of opportunities for their development (training courses,
seminars, youth exchange programs, networking and other
activities). In addition, the NGO aims to provide quality
educational activities to young people in the country.
They intend to invest in the future of the Bulgarian youth nation and the
skills they need to guide them to succeed and grow in their professional and
private lives to help them improve. The history of the NGO that launched
YOUTHub.bg goes back to 2012, when its founder Ms. Madlen Nenkova
founded a Facebook group. The group aimed to serve there as a space
where all envisaged opportunities to allow young people to be active and
grow will be shared. By September 2016, the group reached more than
13,000 people, including high school and university students, young
professionals, NGO staff, teachers, business people, and others.
Target Groups: Young people in Bulgaria
Stakeholders: More than 17,000 followers and visitors
Publication Frequency: 7/24
Languages: Bulgarian and English
Website Link: http://youthub.bg
Social Media Links:
https://www.facebook.com/youthub.bg
https://www.instagram.com/youthub.bg/
https://www.youtube.com/channel/UCZ6Tf0936KP8BKL7qVuhFGQ/featured
https://www.linkedin.com/company/youthub/
Content: YouthHub provides information to Bulgarian youth on education,
professional development, development of new skills, job opportunities, and
many other topics. Ongoing projects/initiatives:
► Leadership Academy GLOW
► "Open lessons in the bar"
► "Social cafeteria - book for everyone."
► Revised Ideas - StartUP Conference
► WIZZ Youth Challenge - International youth competition
► "Design as magic" - Training program and many more can be found
at YouthHub.bg
170
The case of NULA 32 (НУЛА 32)
Media Name: NULA 32 (НУЛА 32)
Media Type: Information web portal www.orvmedia.com, Radio ORV and ORV +
video platform.
Founder: 4 young men from Plovdiv - Atanas Yankov, Panayot Stefanov, Iliya Dimitrov
and Kostadin Bukhchev
Founding Date: September 2015
Strategy: NULA 32 is the Plovdiv magazine distributed for free. The subjects covered
are related to the city's culture, life, and personality. Besides being an alternative, the
magazine is far from pop culture. Here you can find exciting stories and great photos.
Target Groups: Young people and artists
Stakeholders: more than 28,000
Publication Frequency: Facebook profile: 7/24, Printed magazine: It is published
every three months.
Languages: Bulgarian only
Website Link: http://nula32.bg
Social Media Link:
https://www.facebook.com/nula32
https://www.instagram.com/nula32magazine/
https://www.linkedin.com/company/nula32-magazine/
https://www.youtube.com/channel/UCyHhY0375SHMWqUGJk6sKDw
https://open.spotify.com/show/3QhQRQQ5c0NuN5vOeImLK h
Content: NULA 32 works with the cultural dynamics of the city of Plovdiv. The
magazine is unique with its paper pages and hardcovers, which is unusual in our
digital age. The subject in it concerns the city's future, nature, and history (each time,
the focus is different and relates to various aspects of our historical heritage).
171
14.3 Media cases from Portugal
The case of RÁDIO MANOBRAS
Media Name: Rádio Manobras
Media Type: Radio
Founder: Anselmo Canha
Founding Date: September 2011
Strategy: Rádio Manobras is a public radio for Porto, open to
everyone, where he lives, works, adds life, and defines the city's
identity. Rádio Manobras is involved in a common, activist, and
volunteer daily practice. Provides broadcast access to the community.
For the community, it is a tool made by the community and held by
the community and in the public domain. The ultimate goal is to
promote diversity and progress in all matters. While it is broadcasted
on the internet for 24 hours, it broadcasts at a frequency of 91.5 MHZ
at regular intervals.
Target Groups: Since it is mainly an internet radio, it is not possible to
limit the target audience. When it broadcasts on a radio frequency,
the target group is the citizens of the city of Porto.
Stakeholders: 6237 followers on Facebook page
Publication Frequency: Every day.
Languages: Although it is Portuguese, it is open to all languages.
Website Link: www.radiomanobras.pt
Social Media Links: https://www.facebook.com/radiomanobras/
Content: The current program includes themes from feminism, mental
health and agriculture to experimental voice, etc.
The case of RAUM: ONLINE ARTIST RESIDENCES
Media Name: RAUM: ONLINE ARTIST RESIDENCES (Raum: Online
Artist Residence)
Media Type: Online platform
Founder: Terceiro Direito
Date of Establishment: 2015
Strategy: It is an online platform that hosts artists' residences with
the support of structures actively used in artistic creation, teaching,
and publishing (university research units, publication projects,
museums, visual arts schools, and independent art projects). The
172
areas of art considered are photography and visual arts, film,
architecture, graphic design, music, and sound arts. Raum's partners
are invited to initiate creative processes such as investigative texts,
visual and audio articles, and artworks specially developed for the
platform, embodied in the suggestions of guest artists. Raum
platform is a platform supported by many public and private
institutions and organizations, from municipalities to museums, and
it is a partner.
Target Groups: Artists and art students.
Stakeholders: 3244 followers on Facebook.
Publication Frequency: Every two weeks.
Languages: Portuguese and English.
Website Link: http://raum.pt/
Social Media Links: https://www.facebook.com/Raum-
resid%C3%AAncias-art%C3%ADsticas-online-371900256290770/
Content: On the website, you can find art workshops and
discussions, current residences, projects under development, and
proposals.
The case of RÁDIO MIÚDOS
Media Name: Rádio Miúdos
Media Type: Online Radio
Founder: RádioMiúdos.pt - Associação Portuguesa Rádio Miúdos
Founding Date: November 2015
Strategy: Rádio Miúdos is the first Portuguese radio for children where
language, information, and content are fully adapted to young people.
Radio promotes interaction between children with content that must
be presented by the radio. Each child is invited to play with their own
language and discover the culture, history, and Portuguese language.
Destination all PALOP countries (African Portuguese-speaking
countries) and uniting every Portuguese-speaking child. The idea is to
tackle the "despair of the language" immigrants face when living
abroad, thereby filling a gap in the Portuguese language panorama. It
provides a meeting point and a tool for immigrant children worldwide
to connect with culture by using language while maintaining their
connection with Portugal.
Publication Frequency: 7 days a week, 24 hours a day.
Stakeholders: 8649 followers on Facebook.
Language: Portuguese
Website Link: www.radiomiudos.pt
Social Media Links:
https://www.facebook.com/radiomiudos
173
https://www.youtube.com/channel/UCv8Jh8aifsr00tf-Lz2c0KQ
Content: Rádio Miudos includes podcasts, interviews and difficult
topics for participants both in and outside Portugal. More information
can be found about Programming, News, Interviews, Schools,
challenges, and Podcasts on the website. Their programs include
entertaining information about philosophy, books, Portugal, cinema,
meditation, science, etc. This project ranked 3rd in the "Original
Portuguese Ideas" 2015 competition promoted by the Calouste
Gulbenkian Foundation and COTEC, and won 1st place in the "Canvas -
Standing Projects" contest supported by the Portuguese
representation of the European Commission in "Entrepreneurship
Exchange 2016".
14.4 Media cases from Turkey
The case of AÇIK RADYO
Media Name: AÇIK RADYO
Media Type: Radio
Founders: Açık Radyo consists of 92 partners, almost all of whom
have equal shares.
Founding Date: November 13, 1995
Strategy: Açık Radyo is not dependent on any interest or capital
group. In addition to operating independently of the state, pluralist
democracy is utterly independent of any "ideology" other than the
rule of law and the protection and awareness of universal human
rights and fundamental freedoms. Hence, it is an independent
institution. For 20 years since its establishment, Açık Radio has
been dedicated to the efforts and talents of 1133 individuals aged
9 to 75, who have contributed to the production of more than
1145 programs (talk shows, conversations, musical performances,
etc.)
Target Groups: Açık Radyo is a "regional" radio station
broadcasting in Istanbul metropolitan area and its surroundings.
Shareholders: Audiences and some institutional support
Publication frequency: 24/7
Impact: 33,580 likes on Facebook page.
Languages: Turkish
Web Site Link: http://acikradyo.com.tr/
174
Social Media Links:
https://www.facebook.com/acikradyo
https://twitter.com/acikradyo
https://www.instagram.com/acikradyo/
https://www.youtube.com/channel/UCH9LJ4LCDzVDJZtQA_NOr6Q
https://www.flickr.com/photos/acikradyo/
Content: Perhaps we can best explain Açık Radyo as a combination
of News + Music + Personality. Talk shows by Açık Radyo are
about:
News and commentary, ecology, environment, folk culture,
philosophy, language, civilized society, birth, women, children,
youth, grassroots organizations, Istanbul city, Europe, European
Union, Mediterranean, Anatolia, fundamental rights, law, peace
movements, history mathematics, mind games, science, science
fiction, mythology, anthropology, human brain, economy,
archeology, political economy, social policy, meteorology, climate
science, local government, design, architecture, world literature,
poetry, books, theater, cinema, plastic arts, urban planning,
museums, communication, internet, electronic games, television,
psychology, traffic, business world, advertising, consumer society,
health, cuisine, wine, bread, olives, coffee, perfume, football,
sport, travel, nature, photography, amateur flying, riding, sailing,
earthquake preparedness, occupational hazards & safety,
children's rights, animal rights, globalization, civilized society,
social movements.
The case of NOR RADYO
Media Name: Nor Radyo
Media Type: Internet Radio
Founder: Nor Zartonk
Date of Establishment: 2009
Strategy: Nor Radyo has defined its broadcasting policy as "an internet
radio project where all people can freely express themselves and share
their culture." Nor Radyo is the voice of multiculturalism and coexistence.
In this context, it favors peace, freedom, equality, and fraternity against
nationalism and all kinds of racial, ethnic, and sexual discrimination. All
friends who share these common denominators and want to share their
cultural wealth are invited to this free platform.
Target Groups: It reflects different cultures with its multilingual structure.
With the internet radio feature, it is impossible to limit the target
audience.
Shareholders: Armenian Culture and Solidarity Association
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Frequency: 7/24
Impact: The Facebook site has 8,345 likes and 8,311 followers.
Languages: The radio broadcasts in Turkish, Armenian, Greek, Syriac,
Hamshen, Circassian, Chechen, Pomak, Laz, Georgian, Zaza, Kurdish, and
Ladino.
Website Link: www.norradyo.com
Social Media Links: https://www.facebook.com/norradyo
https://twitter.com/norradyo
https://www.instagram.com/norradyo/
Content: Workers, animal rights, women's movement, LGBTI+, gender
and ecological movement have been included in the programs of Nor
Radio so far.
14.5 Examples of Community Media Projects from the
European Union
The case of La Maison des Media Libres
La Maison des Media Libres (House of Free Media) is a French initiative
that combines four community television initiatives under one umbrella
to offer an alternative perspective on current developments and social
and cultural issues. The main goals are establishing an alternative media
center that includes television and radio production, book publishing, film
distribution, and online activities. The organization combines the
capabilities of a community television initiative (Zalea TV), a community
radio initiative (Radio Frequence Paris Plurielle), a community magazine
(Les périphériques vous parlent), and a film distribution association
(Coerrances). The four organizations jointly pool their resources and
collaborate on specific projects. It also organizes "weeks of action" on
alternative media strategies for other community media organizations
(European Parliament, 2007:5-6).
Website: http://souriez.info/La-maison-des-medias-libres
176
The case of Angel Radio
Community media sometimes appeals to specific age groups. Angel Radio
(England) is targeted and produced by older citizens who play a more active
role in London's community life. The station has produced many programs
that specifically address aging-related issues. It also functions as a social
focus and offers seniors a resource and information center. Angel Radio
seeks to spark public discussions on issues that matter to its base. For
example, it has produced CDs for local schools aimed at raising awareness
about topics such as the neglect of the elderly and about physical and
mental abuse suffered by elderly citizens (European Parliament, 2007:6).
Website: http://angelradio.co.uk/
The case of Radio Regen
Radio Regen is a Manchester-based initiative that aims to develop media
and communication skills as a tool for social inclusion and regional
revitalization. It has developed a three-level training course to respond to
the diverse needs of the station base. In its training program, Radio Regen
first offers all its volunteers three days of certified "basic training" in radio
production. It also provides a ten-week introductory course to help develop
the technical and soft skills of the unemployed. In addition, the organization
has launched one year for anyone wishing to pursue a career in radio
production. Media literacy skills are also taught as part of the English
National Curriculum. Radio Regen has partnered with six (6) local schools to
support communication and IT skills through radio production and
broadcasting sessions. Finally, Radio Regen has developed a Community
Radio Toolkit on how to start, run and fund community media initiatives.
This toolkit is available online and provides valuable advice to community
media volunteers and activists (European Parliament, 2007:8).
Website: http://www.radioregen.org
14.6 Conclusions
This chapter established and analyzed the link between social
entrepreneurship and community media. The subject has been presented and
supported by examples of conceptual content of the community media and its
historical development in the world and the community media in the
European Union member states.
177
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“Genç Topluluk Medya Yapıcıları için Sosyal Girişimcilik” TOPLULUK MEDYASI EĞİTİM
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The Authors
Abel Diaz Gonzalez
He is an Assistant Professor in the Department of Organization, Strategy and Entrepreneurship at the School of Business
Economics, Maastricht University. He holds a PhD in Business Economics from the Vrije Universiteit Brussels (VUB) where
he participated of this ERMIs project as well.His research focuses on ecosystems for social entrepreneurs, and their
supportive function and mechanisms. Part of his research is dedicated to investigating the supportive role and interaction
of universities’ main stakeholders, processes and activities within and across the ecosystems of social entrepreneurs. Abel
has conducted field research in Bolivia, Ecuador, Colombia, and Belgium. His research has been presented at different
international conferences such as the Academy of Management (AoM), the International Association for Business and
Society (IABS), the New Business Models Conference, and the Social Entrepreneurship Summit. Abel has acted as a
reviewer at various conferences and for journals. He is involved in special issues in peer review journals and has acted as
editor of book series in the field of Social Entrepreneurship. Abel is also part of the leadership of different international
associations: New Business Models (Conference Chair 2023); International Association for Business and Society
(Representative at Large); Social Entrepreneurship Summit (Co-founder and Co-organizer). Prior to his appointment at
UM, Abel was a visiting professor at the Department of Business and a postdoctoral fellow at the Chair of Social
Entrepreneurship at the Vrije Universiteit Brussels (Belgium), where he supervised master theses and co-supervised
doctoral students.
Bart Leyen
He is a PhD student at the Vrije Universiteit Brussel, and is looking to develop a methodology for creating supportive
ecosystems for social entrepreneurs. Here will be looked in the ecosystem actors and their relationships, how an
ecosystem can be assessed. This to safeguard the efficiency of the ecosystem. The ultimate goal is a tool for creating
supportive ecosystems.
Claudia Alba
She is currently doing a PhD in Business Economics from Vrije Universiteit of Brussels, her research is mainly focused on
support for entrepreneurs at the Base of the Pyramid. Before, she did a master’s in international business. She has
participated in international conferences to present her research as AOM, IABS and NBM. She has been working four
years with the VUB Chair of Social Entrepreneurship. Before, she worked in the Novus Foundation in Bolivia. Currently,
she has ten years of experience supporting entrepreneurs.
Diana Kopeva
She is a full time professor at the University of National and World Economy (UNWE), Sofia, Bulgaria. She gives lectures
on Strategic Management, Entrepreneurship, Social Entrepreneurship, Business Planning. She has more than 100
scientific publications, based on her research interests. She is one of the leading researchers in the area of business
economics and entrepreneurship in Bulgaria. Her research interests are in the field of start-ups, corporate social
responsibility (CSR) and circular economy. She participated in numerous projects (national and international). Professor
Diana Kopeva has more than 100 publications and has participated in more than 25 international projects. She has been a
keynote speaker on different international conferences and has been appointed as guest lector in different universities
worldwide.
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Eliana Vassiliou
Project Coordinator & Youth Worker Eliana Vasileiou works in EKO as a Project Manager since 2018. She holds a Bachelor
degree in Molecular Biology & a Master degree in Cognitive Neuroscience from Radboud University (RU) in Nijmegen,
Netherlands. Eliana has accumulated experience as a youth worker, through her role as a team leader, a mentor of
volunteers and facilitator of NFE workshops on project and team management. She has also been involved in the full
project-lifecycle management (proposal, preparation, implementation, follow-up and reporting), as the coordinator, in 10
Youth Mobility programs. Currently, she is in charge of several Erasmus+ KA2 & KA3 and other large-scale European
projects, with tasks including project design and proposal writing, project preparation, implementation and coordination,
course content creation, mentoring of young organizations/youth groups and organization of onsite trainings.
Figen Algul
Algül worked as a reporter, program producer and presenter at various TV channels and production companies during her
undergraduate education at Marmara University Faculty of Communication. After completing her postgraduate education
at Marmara University Radio-Television Department with her thesis on Political Communication and Media, she studied at
the FH Fulda Intercultural Communication and European Studies program in Germany in the 2009-2010 academic year,
during her doctoral studies at the same department. Dr. Algül received her doctorate in 2012 with her thesis on
Community Media in parallel with ethnic and minority groups in Turkey. Algül has a book called “Community Media - The
Example of Nor Radio”. She completed her Post Doctorate in Athens National and Kapodistrian University, Department of
Communication and Media Studies in the 2018-2019 academic year, with a TÜBİTAK Post-Doctoral Research Scholarship,
under the supervision of Assoc. Dr. Tsaliki, on the subject title of Soft Power and Inter Cultural Communication:
Perception/Reception of Turkey in Greece through the study of Turkish soap. She is still working as an Assistant Professor
at Marmara University, Faculty ofCommunication. She works as a researcher in the European Union project ERMIScom:
Common curricula for diversity: Education in media and integration of vulnerable groups. Figen Algül academic fields of
study include Media and society, audience studies, alternative media, intercultural communication, political
communication and social memory studies.
Iliya Kereziev
He is a Chief Assistant Professor at the Department of Management, University of National and World Economy (UNWE),
Sofia, Bulgaria. He teaches subjects as Foundations of Management, Small Business Management, Strategic Management
and Management of Family Business. His research interests include entrepreneurship, strategic management, managing
growing SMEs and family business development. In 2010 he has defended doctoral dissertation on a subject
"Managing growing technology-based SMEs". As a member of different research teams at UNWE, he has
participated in several national and international research and training projects in the area of entrepreneurship and small
business development.
Jorge Salas
He has PhD in Business Economics from Vrije Universiteit of Brussels, his research is mainly focused on entrepreneurial
competencies at Bottom of the Pyramid and Uncertainty on Entrepreneurial activity. Jorge, participated of the ERMIS
project during his time at the VUB. Currently, He is a professor from UCB in Bolivia, his research has been presented in
international conferences, and furthermore acts as a reviewer for peer-reviewed journals in the fields of
entrepreneurship. His current activity focuses on teaching, research capacity building in Bolivian universities, and
entrepreneurial ecosystem development . His previous research had a focus on Economic growth and economic
development models, and financial risk models.
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Philippe Eiselein
He is a senior researcher at Odisee University of Applied Sciences, and part of the scientific research center
CenSE (Center for Sustainable Entrepreneurship). He obtained his Ph.D. in Business Economics (commercial
engineer) and is visiting professor at the Business Department of the Vrije Universiteit Brussel (VUB). His
doctoral thesis deals with the "Management of Social Enterprises: scaling up and conflicting objectives."
He is currently focusing on (corporate) sustainability research projects, such as cross-sectoral partnerships
and collaborations to stimulate the circular transition, competencies for future jobs in the circular economy
for people with a distance to the labor market, and skills development of next-generation managers for
sustainability. His ongoing research has been presented at international conferences such as the Annual
Conference on Social Entrepreneurship, the Belgian Entrepreneurship Research Day, the International
Association for Business and Society, as well as the New Business Models conference in Austria, Belgium,
Bolivia, Bulgaria, Denmark, Finland, Hong Kong, Portugal, the United States, and the Netherlands. He also
has been involved in the organization of various conferences, and furthermore acts as a reviewer for several
peer-reviewed journals in the fields of social entrepreneurship and circular economy. Furthermore, he has
developed project management experience in sustainability engagement and partnerships, as he has been
the coordinator of Belgium Impact, the national platform supporting more than 300 Belgian impactful social
entrepreneurs. It was initiated by His Majesty the King of Belgium and aimed to further stimulate the
Belgian social entrepreneurial ecosystem and inspire others through a transdisciplinary approach.
Romel Brun
He is a Full Professor of Economics at the Universidad Católica Boliviana San Pablo. His main research
interests lie at the intersection of institutions and entrepreneurship. He currently serves as an Internal
Editorial Board for the Revista Perspectivas. Romel has co-edited two books and contributed multiple
chapters to edited books. At the undergraduate level, Romel primarily teaches Principles of icroeconomics.
He also teaches Principles of Macroeconomics and Econometrics. He has taught Economics to Managers in
the MBA program. Romel is a native of Oruro (Bolivia). He earned her B.B.A. in economics from Finis Terrae
University (Chile). He earned a Master of Science in Economics at the University of Lausanne (Switzerland).
He completed his Ph.D. in applied economics at Vrije Universiteit Brussel (Belgium) while participating as a
researcher in the ERMIS Project during his doctoral studies as well.
Sami Huohvanainen
He is a senior lecturer at Helsinki Metropolia University of Applied Sciences. His main areas are broadcast
journalism and media entrepreneurship. He is working on a number of projects concerning journalism,
freedom of speech, sustainable development, and entrepreneurship. His professional interests include radio
and television journalism, media concept development, pedagogy, and entrepreneurship.
Savvatou Tsolakidou
She is currently working as Laboratory and Teaching staff at the Department of Communication and Media
Studies of the National and Kapodistrian University of Athens (NKUA) and as Consultant Professor at the
Hellenic Open University in the postgraduate programme “Adult Education”. She studied Sociology and
French Literature and she worked at the Hellenic Ministry of Education, the National Centre for Public
Administration and the European Commission as National Detached Expert. Her research interests focus on
lifelong learning and Communication, organizational communication, adult education, capacity building and
skills, social policy, and the social integration of vulnerable groups. She is the Scientific Coordinator and
Project manager of the ERMIScom university partnership project funded by IKY, the Greek National Agency
for the Erasmus+ programme.
181
The Editors
Nikolay A. Dentchev
He is Associate Professor of Entrepreneurship and CSR at the Vrije Universiteit Brussel (Belgium) and a
Visiting Professor at the University of National and World Economy (Bulgaria). He holds the VUB Chair of
Social Entrepreneurship. His research is published in journals such as Business & Society, Technological
Forecasting and Social Change, Journal of Business Ethics, and Business Ethics, the Environment and
Responsibility. He serves as associate editor of Business and Society Review, and occasionally as guest editor
to special issues. His research interests are related to BOP entrepreneurship, social entrepreneurship, and
sustainable business models. He is leading several projects that provide hands-on support to vulnerable
entrepreneurs in various countries in Latin America and Africa.
Jason Jahir Roncancio Marin
Jason holds a Ph.D. in Innovation and Entrepreneurship from the Vrije Universiteit Brussel. He currently
serves as a professor and posdoctoral researcher on Innovation and Entrepreneurship at the Vrije
Universiteit Brussel in Belgium, and as professor of Strategic Management at Vesalius College. His doctoral
research focused on positioning the entrepreneurial university and academic entrepreneurship as drivers of
social change and sustainability. For which, he also addresses issues related to technology transfer and
entrepreneurship with high societal impact.
Claudia Alba
She is currently doing a PhD in Business Economics from Vrije Universiteit of Brussels, her research is mainly
focused on support for entrepreneurs at the Base of the Pyramid. Before, she did a master’s in international
business. She has participated in international conferences to present her research as AOM, IABS and NBM.
She has been working four years with the VUB Chair of Social Entrepreneurship. Before, she worked in the
Novus Foundation in Bolivia. Currently, she has ten years of experience supporting entrepreneurs.
Georgios Outsios
A deep connection to nature inspired Georgios to complete a PhD in Environmental Entrepreneurship with
the University of Stirling, in Scotland. He has worked for several years as a Teaching Assistant with the
University of Stirling and as a Lecturer (hourly) with Edinburgh Napier University in Scotland. His professional
experiences also include working with the public (National Employment Service) and private sectors in
Greece, the hospitality industry in the UK, and as a programme management trainee with the European
Commission in Belgium. Currently, he is a Postdoctoral Research Fellow (Marie-Sklodowska-Curie Action)
with VUB, and his research is dedicated to the study of the process of eco-innovation among environmental
enterprises.
