A startup or start-up is a company or project undertaken by an entrepreneur to seek, develop, and validate a scalable business model . While entrepreneurship includes all new businesses including self-employment and businesses that do not intend to go public , startups are new businesses that intend to grow large beyond the solo-founder. During the beginning, startups face high uncertainty and have high rates of failure, but a minority of them do go on to become successful and influential, such as unicorns .
171-544: Social entrepreneurship is an approach by individuals, groups, start-up companies or entrepreneurs , in which they develop, fund and implement solutions to social, cultural, or environmental issues. This concept may be applied to a wide range of organizations, which vary in size, aims, and beliefs. For-profit entrepreneurs typically measure performance using business metrics like profit , revenues and increases in stock prices . Social entrepreneurs, however, are either non-profits , or they blend for-profit goals with generating
342-407: A Nobel Peace Prize for his efforts. Others, such as former Indianapolis mayor Stephen Goldsmith , addressed social efforts on a local level by using the private sector to provide city services. Bill Drayton founded Ashoka in 1980, an organization which supports local social entrepreneurs. Drayton tells his employees to look for four qualities: creativity, entrepreneurial quality, social impact of
513-674: A Stanford's research park became a veritable startup avalanche... Thus, over the course of just 20 years, a mere eight of Shockley's former employees gave forth 65 new enterprises, which then went on to do the same... Startup advocates are also trying to build a community of tech startups in New York City with organizations like NY Tech Meet Up and Built in NYC. In the early 2000s, the patent assets of failed startup companies were being purchased by people known as patent trolls , who assert those patents against companies that might be infringing
684-507: A balanced "risk/reward" profile (in which high risk due to the untested, disruptive innovations is balanced out by high potential returns) and "scalability" (the likelihood that a startup can expand its operations by serving more markets or more customers). Attractive startups generally have lower " bootstrapping " (self-funding of startups by the founders) costs, higher risk, and higher potential return on investment . Successful startups are typically more scalable than an established business, in
855-438: A broader (regional, country level or even global) level which influence their immediate environment. Many researchers such as P. N. Bloom and J. G. Dees attempted to develop an ecosystem model for social entrepreneurs. The ecosystem model proposed by them comprises all the actors operating in the ecosystem, as well as the larger environment the laws, policies, social norms, demographic trends, and cultural institutions within which
1026-423: A business partner) in a market with a dominant design (a clear standard is applied in this market). In contrast to this, profile is the originator which has a management style that is highly entrepreneurial and in which a radical invention or a disruptive innovation (totally new standard) is being developed. This profile is set out to be more successful (in finding a business partner) in a market that does not have
1197-408: A business plan in place outlines what to do and how to plan and achieve an idea in the future. Typically, these plans outline the first three to five years of your business strategy. Models behind startups presenting as ventures are usually associated with design science . Design science uses design principles considered to be a coherent set of normative ideas and propositions to design and construct
1368-537: A business sense; instead, they may be charities, non-profit organizations or voluntary sector organizations. In addition, there are support organizations dedicated to empowering social entrepreneurs, connecting them with mentors , strengthening their enterprise models, and preparing them for capital investments . These incubators and accelerator organizations provide office and meeting space (often free), mentoring and coaching for social enterprise founders and leaders to help them develop their enterprises by improving
1539-467: A certain level of effectiveness. The Internet, social networking websites and social media have been pivotal resources for the success and collaboration of many social entrepreneurs. In the 2000s, the Internet has become especially useful in disseminating information to a wide range of like-minded supporters in short amounts of time, even if these individuals are geographically dispersed. In addition,
1710-710: A clearer definition of what social entrepreneurship entails, it is necessary to set the function of social entrepreneurship apart from other voluntary sector and charity-oriented activities and identify the boundaries within which social entrepreneurs operate. Some scholars have advocated restricting the term to founders of organizations that primarily rely on earned income (meaning income earned directly from paying consumers), rather than income from donations or grants. Others have extended this to include contracted work for public authorities, while still others include grants and donations. Social entrepreneurship in modern society offers an altruistic form of entrepreneurship that focuses on
1881-424: A company's value is based on its technology, it is often equally important for the business owners to obtain intellectual property protection for their idea. The newsmagazine The Economist estimated that up to 75% of the value of US public companies is now based on their intellectual property (up from 40% in 1980). Often, 100% of a small startup company's value is based on its intellectual property. As such, it
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#17328022505652052-672: A comprehensive ecosystem model in the context of the Indian microfinance sector that can be also used by other social enterprises as a framework to understand their own ecosystem and formulate their strategy. The researchers define the ecosystem as consisting of "the complex and evolving network of the focal organization (social enterprise) and all other individuals and organizations that the focal organization interact with including competitors, suppliers, complementors, customers, beneficiaries, regulators, resource providers, etc. that directly or indirectly influence each other; their interactions, as also
2223-441: A dominant design (established standard). New startups should align themselves to one of the profiles when commercializing an invention to be able to find and be attractive to a business partner. By finding a business partner, a startup has greater chances of success. Startups usually need many different partners to realize their business idea. The commercialization process is often a bumpy road with iterations and new insights during
2394-456: A dysfunctional founding team, a poor business plan, or just a flawed product-market fit as examples of the primary sources of failure. The lack of human and financial resources or even dedicated patent attorneys in the early stages of a startup makes it difficult to compete with larger companies, and likewise increases the time and reduces the probability of patent applications. Failed entrepreneurs, or restarters, who after some time restart in
2565-772: A form of online investing that has been legalized in several nations, startups did not advertise themselves to the general public as investment opportunities until and unless they first obtained approval from regulators for an initial public offering (IPO) that typically involved a listing of the startup's securities on a stock exchange . Today, there are many alternative forms of IPO commonly employed by startups and startup promoters that do not include an exchange listing, so they may avoid certain regulatory compliance obligations, including mandatory periodic disclosures of financial information and factual discussion of business conditions by management that investors and potential investors routinely receive from registered public companies. Over
2736-441: A great disparity of conceptualizations. These should be arranged in 5 clusters of meaning, according to the focus given and the conceptual framework assumed by the researcher. The first group of authors focuses on the person of the entrepreneur, being the mainstream definition. J. G. Dees argues that social entrepreneurship is the result and the creation of an especially creative and innovative leader. Social entrepreneurs can include
2907-489: A huge speed before running out of resources. Proactive actions (experimentation, searching, etc.) enhance a founder's learning to start a company. To learn effectively, founders often formulate falsifiable hypotheses , build a minimum viable product (MVP), and conduct A/B testing . With the key learnings from market validation, design thinking, and lean startup, founders can design a business model. However it's important not to dive into business models too early before there
3078-513: A lack of financing or investor interest. These common mistakes and missteps that happen early in the startup journey can result in failure, but there are precautions entrepreneurs can take to help mitigate risk. For example, startup studios offer a buffer against many of the obstacles that solo entrepreneurs face, such as funding and insufficient team structure, making them a good resource for startups in their earliest phases. Another large study of 160.000 failed companies, identified key factors such as
3249-571: A larger audience. Prominent individuals associated with social entrepreneurship include Pakistani Akhter Hameed Khan and Bangladeshi Muhammad Yunus , a leader of social entrepreneurship in South Asia . Yunus was the founder of Grameen Bank , which pioneered the concept of microcredit for supporting innovators in multiple developing countries in Asia , Africa , and Latin America . He received
3420-403: A lower cost. It is based on the idea that entrepreneurs can make their implicit assumptions about how their venture works explicit and empirically testing it. The empirical test is to de/validate these assumptions and to get an engaged understanding of the business model of the new ventures, and in doing so, the new ventures are created iteratively in a build–measure–learn loop. Hence, lean startup
3591-436: A network-based conception for characterizing the social capital of collectivities (such as organizations or business clusters), Lester, Maheshwari, and McLain (2013) note that negative social capital may be the cause for disadvantageous differences among minority firms versus majority firms. While studying norms among African-American family firms and Euro-American family firms, Lester et al. noted that negative social capital
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#17328022505653762-457: A new Accelerator investment model was introduced by Y Combinator that combined fixed terms investment model with fixed period intense bootcamp style training program, to streamline the seed/early-stage investment process with training to be more systematic. Social capital Social capital is "the networks of relationships among people who live and work in a particular society, enabling that society to function effectively". It involves
3933-463: A number of ways, including surveys, cold calling, email responses, word of mouth or through sample research. Design thinking is used to understand the customers' need in an engaged manner. Design thinking and customer development can be biased because they do not remove the risk of bias because the same biases manifest in the sources of information, the type of information sought, and the interpretation of that information. Encouraging people to consider
4104-430: A percentage of monthly revenue. Venture capital firms and angel investors may help startup companies begin operations, exchanging seed money for an equity stake in the firm. Venture capitalists and angel investors provide financing to a range of startups (a portfolio), with the expectation that a very small number of the startups will become viable and make money. In practice though, many startups are initially funded by
4275-406: A positive "return to society". Therefore, they use different metrics. Social entrepreneurship typically attempts to further broad social, cultural and environmental goals often associated with the voluntary sector in areas such as poverty alleviation, health care and community development . At times, profit-making social enterprises may be established to support the social or cultural goals of
4446-434: A powerful team: the product person (e.g. an engineer), a marketing person (for market research , customer interaction, vision) and a finance or operation's person (to handle operations or raise funds). The founder that is responsible for the overall strategy of the startup plays the role of founder-CEOs, much like CEOs in established firms. Startup studios provide an opportunity for founders and team members to grow along with
4617-441: A problem. The founder of a startup will do the market validation by problem interview, solution interview, and building a minimum viable product (MVP), i.e. a prototype , to develop and validate their business models. The startup process can take a long period of time; hence, sustaining effort is required. Over the long term, sustaining effort is especially challenging because of the high failure rates and uncertain outcomes. Having
4788-646: A process could lead to the very inequality social capital attempts to resolve. While Coleman viewed social capital as a relatively neutral resource, he did not deny the class reproduction that could result from accessing such capital, given that individuals worked toward their own benefit. Even though Coleman never truly addresses Pierre Bourdieu in his discussion, this coincides with Bourdieu's argument set forth in Reproduction in Education, Society and Culture . Bourdieu and Coleman were fundamentally different at
4959-525: A producer of " civic engagement " and also a broad societal measure of communal health. He also transforms social capital from a resource possessed by individuals to an attribute of collectives, focusing on norms and trust as producers of social capital to the exclusion of networks. Mahyar Arefi (2003) identifies consensus-building as a direct positive indicator of social capital. Consensus implies "shared interest" and agreement among various actors and stakeholders to induce collective action. Collective action
5130-401: A profit but to address suffering. Muhammad Yunus says about this characteristic, "He (or she) competes in the marketplace with all other competitors but is inspired by a set of social objectives. This is the basic reason for being in the business." Because the world of social entrepreneurship is relatively new, existing now for over a few decades, there are challenges facing those who delve into
5301-425: A range of career types and professional backgrounds, ranging from social work and community development to entrepreneurship and environmental science . For this reason, it is difficult to determine who is a social entrepreneur. David Bornstein has even used the term "social innovator" interchangeably with social entrepreneur, due to the creative, non-traditional strategies that many social entrepreneurs use. For
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5472-785: A sample of 101 unsuccessful startups, companies reported that experiencing one or more of five common factors were the reason for failure; the lack of consumer interest in the product or service (42% of failures), funding or cash problems (29%), personnel or staffing problems (23%), competition from rival companies (19%) and problems with pricing of the product or service (18%). In cases of funding problems, it can leave employees without paychecks. Sometimes, these companies are purchased by other companies if they are deemed to be viable, but oftentimes, they leave employees with very little recourse to recoup lost income for worked time. More than one-third of founders believe that running out of money led to failure. Second to that, founders attribute their failure to
5643-426: A situation that frightens them and then place the candidate in the situation with them. If they feel comfortable in this scenario, the entrepreneur has ethical fiber. One distinguishing attribute of entrepreneurs is that they rarely take credit for making change. They insist that the change they have brought about is due to everyone around them. They also tend to be driven by emotion; they are not trying primarily to make
5814-414: A social network, adhering to the norms of that group, allowing him to later access the resources (e.g. social relationships) gained over time. If, in the case of education, he uses these resources to better his educational outcomes, thereby enabling him to become socially mobile , he effectively has worked to reiterate and reproduce the stratification of society, as social capital has done little to alleviate
5985-471: A startup, there are different types of stages in which the investor can participate. The first round is called seed round . The seed round generally is when the startup is still in the very early phase of execution when their product is still in the prototype phase. There is likely no performance data or positive financials as of yet. Therefore, investors rely on strength of the idea and the team in place. At this level, family friends and angel investors will be
6156-539: Is Andrew Mawson OBE , who was given a peerage in 2007 because of his urban regeneration work including the Bromley by Bow Centre in East London. Although the terms are relatively new, social entrepreneurs and social entrepreneurship may be found throughout history. A list of a few noteworthy people whose work exemplifies the modern definition of "social entrepreneurship" includes Florence Nightingale , founder of
6327-632: Is Muhammad Yunus , who founded the Grameen Bank in 1976. He is known as the "father of microcredit ," and established the microfinance movement, which aims to help millions of people rural communities to access small loans. For his work, he was awarded a Nobel Peace Prize in 2006. The work that Yunus did through Grameen Bank has been described as a major influence on later social entrepreneurs. Larger countries in Europe and South America have tended to work more closely with public organizations at both
6498-400: Is women's entry into the workforce , which could correlate with time restraints that inhibit civic organizational involvement like parent-teacher associations . Technological transformation of leisure (e.g., television) is another cause of declining social capital, as stated by Putnam. This offered a reference point from which several studies assessed social capital measurements by how media
6669-425: Is a necessary antecedent for the development of the more powerful form of bridging social capital. Bonding and bridging social capital can work together productively if in balance, or they may work against each other. As social capital bonds and stronger homogeneous groups form, the likelihood of bridging social capital is attenuated. Bonding social capital can also perpetuate sentiments of a certain group, allowing for
6840-472: Is a set of principles for entrepreneurial learning and business model design. More precisely, it is a set of design principles aimed for iteratively experiential learning under uncertainty in an engaged empirical manner. Typically, a lean startup focuses on a few lean principles: A key principle of startup is to validate the market need before providing a customer-centric product or service to avoid business ideas with weak demand. Market validation can be done in
7011-406: Is approaching at which social capital comes to be applied to so many events and in so many different contexts as to lose any distinct meaning." The term capital is used by analogy with other forms of economic capital , as social capital is argued to have similar (although less measurable) benefits. However, the analogy may be misleading in that, unlike financial forms of capital, social capital
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7182-738: Is considered to be a "strong" startup ecosystem. One of the most famous startup ecosystems is Silicon Valley in California, where major computer and internet firms and top universities such as Stanford University create a stimulating startup environment. Boston (where Massachusetts Institute of Technology is located) and Berlin , home of WISTA (a top research area), also have numerous creative industries , leading entrepreneurs and startup firms. Basically, attempts are being made worldwide, for example in Israel with its Silicon Wadi , in France with
7353-407: Is created equally. The value of a specific source of social capital depends in no small part on the socio-economic position of the source with society. On top of this, Portes (1998) has identified four negative consequences of social capital: Social capital (in the institutional Robert Putnam sense) may also lead to bad outcomes if the political institution and democracy in a specific country
7524-578: Is distinct from the concept of entrepreneurship , yet still shares several similarities with its business cousin. Jean-Baptiste Say (1767–1832), a French economist, defined an entrepreneur as a person who "undertakes" an idea and shifts perspectives in a way that it alters the effect that an idea has on society. An entrepreneur is further defined by Say as someone who "shifts economic resources out of an area of lower and into an area of higher productivity and greater yield." The difference between "entrepreneurship" and "social entrepreneurship", however, stems from
7695-485: Is effective in increasing the entrepreneurial attitudes and perceived behavioral control, helping people and their businesses grow. Most of startup training falls into the mode of experiential learning, in which students are exposed to a large extent to a real-life entrepreneurship context as new venture teams. An example of group-based experiential startup training is the Lean LaunchPad initiative that applies
7866-465: Is encouraged through the strengthening of intra-group relationships (bonding social capital). The negative consequences of social capital are more often associated with bonding vis-à-vis bridging . Without "bridging" social capital, "bonding" groups can become isolated and disenfranchised from the rest of society and, most importantly, from groups with which bridging must occur in order to denote an "increase" in social capital. Bonding social capital
8037-519: Is engaged strategically to build social capital. In "Social Capital, Civil Society, and Development", political economist Francis Fukuyama defines social capital as generally understood rules that enable people to cooperate such as the norm of reciprocity or religious doctrine like Christianity . Social capital is formed by repeated interactions over time and, he argues, is critical for development and difficult to generate through public policy. The importance of social capital for economic development
8208-668: Is equipped to measure. About this, the Schwab Foundation says that entrepreneurs have "A zeal to measure and monitor their impact. Entrepreneurs have high standards, particularly in relation to their own organization's efforts and in response to the communities with which they engage. Data, both quantitative and qualitative, are their key tools, guiding continuous feedback and improvement." Ashoka operates in multiple countries. Entrepreneurial quality builds from creativity. Not only do entrepreneurs have an idea that they must implement, they know how to implement it and are realistic in
8379-412: Is founded upon the exchange of capital (most obviously, money) for goods and services. However, social entrepreneurs must find new business models that do not rely on standard exchange of capital in order to make their organizations sustainable. This self-sustainability is what distinguishes social businesses from charities, who rely almost entirely on donations and outside funding. Social entrepreneurship
8550-589: Is high (US) or where ethnic heterogeneity is high ( Eastern Europe ), it was found that citizens lacked in both kinds of social capital and were overall far less trusting of others than members of homogenous communities were found to be. Lack of homogeneity led to people withdrawing from even their closest groups and relationships, creating an atomized society as opposed to a cohesive community. These findings challenge previous beliefs that exposure to diversity strengthens social capital, either through bridging social gaps between ethnicities or strengthening in-group bonds. It
8721-416: Is important for technology-oriented startup companies to develop a sound strategy for protecting their intellectual capital as early as possible. Startup companies, particularly those associated with new technology, sometimes produce huge returns to their creators and investors—a recent example of such is Google, whose creators became billionaires through their stock ownership and options. When investing in
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#17328022505658892-406: Is linked to the concept's duality, coming because "it has a hard nosed economic feel while restating the importance of the social." For researchers, the term is popular partly due to the broad range of outcomes it can explain; the multiplicity of uses for social capital has led to a multiplicity of definitions. Social capital has been used at various times to explain superior managerial performance,
9063-611: Is not depleted by use; instead, it is depleted by non-use ( use it or lose it ). In this respect, it is similar to the economic concept of human capital . Robison, Schmid, and Siles (2002) review various definitions of social capital and conclude that many do not satisfy the formal requirements of a definition. They assert that definitions must be of the form A=B, while many explanations of social capital describe what it can be used to achieve, where it resides, how it can be created, or what it can transform. In addition, they argue that many proposed definitions of social capital fail to satisfy
9234-625: Is not strong enough and is therefore overpowered by the social capital groups. "Civil society and the collapse of the Weimar Republic " suggests that "it was weak political institutionalization rather than a weak civil society that was Germany's main problem during the Wihelmine and Weimar eras." Because the political institutions were so weak people looked to other outlets. "Germans threw themselves into their clubs, voluntary associations, and professional organizations out of frustration with
9405-457: Is socialized. Thus, it is the social platform, itself, that equips one with the social reality they become accustomed to. Out of habitus comes field, the manner in which one integrates and displays their habitus. To this end, it is the social exchange and interaction between two or more social actors . To illustrate this, we assume that an individual wishes to better his place in society. He therefore accumulates social capital by involving himself in
9576-429: Is sufficient learning on market validation. Paul Graham said: "What I tell founders is not to sweat the business model too much at first. The most important task at first is to build something people want. If you don't do that, it won't matter how clever your business model is." Founders or co-founders are people involved in the initial launch of startup companies. Three people are mainly required as co-founders to create
9747-503: Is that in some cases, social entrepreneurs may only propose short-term solutions, or that they are unable to scale up their virtual, online organization to a larger degree to maximize the number of people who are helped. Government programs are able to tackle large issues; however, there is often little collaboration between governments and social entrepreneurs, which may have limited the effectiveness of social entrepreneurship. This lack of inter-sectoral collaboration may lead to stagnation, if
9918-463: Is that these norms of behavior reduce transaction cost of exchange such as legal contracts and government regulations. Fukuyama suggests that while social capital is beneficial for development, it also imposes cost on non-group members with unintended consequences for general welfare. Referencing Alexis de Tocqueville in Democracy in America , and what he described as the art of association of
10089-456: Is thus an indicator of increased social capital. In Bowling Alone: The Collapse and Revival of American Community (2000), Harvard political scientist Robert D. Putnam writes: Henry Ward Beecher 's advice a century ago to 'multiply picnics' is not entirely ridiculous today. We should do this, ironically, not because it will be good for America – though it will be – but because it will be good for us. Putnam speaks of two main components of
10260-613: Is very important for policy makers to monitor the level of perceived socio-economic threat from immigrants because negative attitudes towards immigrants make integration difficult and affect social capital. Varshney (2001) studied the correlation between the presence of interethnic networks ( bridging ) versus intra-ethnic ones ( bonding ) on ethnic violence in India . He argues that interethnic networks are agents of peace because they build bridges and manage tensions, by noting that if communities are organized only along intra-ethnic lines and
10431-768: The Great Depression , which was blamed in part on a rise in speculative investments in unregulated small companies, startup investing was primarily a word of mouth activity reserved for the friends and family of a startup's co-founders, business angels, and Venture Capital funds. In the United States, this has been the case ever since the implementation of the Securities Act of 1933 . Many nations implemented similar legislation to prohibit general solicitation and general advertising of unregistered securities, including shares offered by startup companies. In 2005,
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#173280225056510602-704: The Inovallée or in Italy in Trieste with the AREA Science Park , to network basic research, universities and technology parks in order to create a startup-friendly ecosystem. Although there are startups created in all types of businesses, and all over the world, some locations and business sectors are particularly associated with startup companies. The internet bubble of the late 1990s was associated with huge numbers of internet startup companies, some selling
10773-668: The Schwab Foundation for Social Entrepreneurship , New Profit Inc. , National Social Entrepreneurship Forum , and the Global Social Benefit Institute among others, promote and providing resources to advance the initiatives of social entrepreneurs. The North American organizations tend to have a strongly individualistic stance focused on a handful of exceptional leaders. For example, The Skoll Foundation, created by eBay 's first president, Jeff Skoll , makes capacity-building " mezzanine level " grants to social entrepreneurial organizations that already have reached
10944-607: The pluralist tradition in American political science . John Dewey may have made the first direct mainstream use of social capital in The School and Society in 1899, though he did not offer a definition. In the first half of the 19th century, de Tocqueville had observations about American life that seemed to outline and define social capital. He observed that Americans were prone to meeting at as many gatherings as possible to discuss all possible issues of state, economics, or
11115-496: The self-efficacy of nascent entrepreneurs. Mentoring offers direction for entrepreneurs to enhance their knowledge of how to sustain their assets relating to their status and identity and strengthen their real-time skills. There are many principles in creating a startup. Some of the principles needed are listed below: Lean startup is a clear set of principles to create and design startups under limited resources and tremendous uncertainty to build their ventures more flexibly and at
11286-500: The trust , reciprocity , information , and cooperation associated with social networks." It "creates value for the people who are connected, and for bystanders as well." Meanwhile, negative norms of reciprocity serve as disincentives for detrimental and violent behaviors. James Coleman defined social capital functionally as "a variety of entities with two elements in common: they all consist of some aspect of social structure, and they facilitate certain actions of actors...within
11457-427: The " self-policing" mechanism proposed by Fearon and Laitin, 1996) may lead to the same result as interethnic engagement. James Coleman (1988) has indicated that social capital eventually led to the creation of human capital for the future generation. Human capital , a private resource, could be accessed through what the previous generation accumulated through social capital. John Field (2003) suggested that such
11628-508: The "world's most successful entrepreneur of social enterprises". Young created more than sixty new organizations worldwide, including the School for Social Entrepreneurs (SSE) which exists in the UK, Australia, and Canada and which supports individuals to realize their potential and to establish, scale, and sustain, social enterprises and social businesses . Another notable British social entrepreneur
11799-399: The 18th century, from Aristotle to Thomas Aquinas , and Edmund Burke . This vision was strongly criticised at the end of the 18th century, with the development of the idea of Homo Economicus and subsequently with rational choice theory . Such a set of theories became dominant in the last centuries, but many thinkers questioned the complicated relationship between modern society and
11970-434: The 1950s and since then has been gaining more momentum. Despite this, after decades of efforts to find a common ground to define the concept, no consensus has been reached. The dynamic nature of the object and the multiplicity of the conceptual lens used by researchers has made it impossible to capture it, to such an extent that scholars have compared it with a mythological beast. Scholars have different backgrounds, generating
12141-462: The 2010s wore hoodies , sneakers and other casual clothes to business meetings. Their offices may have recreational facilities in them, such as pool tables, ping pong tables, football tables and pinball machines , which are used to create a fun work environment, stimulate team development and team spirit, and encourage creativity. Some of the casual approaches, such as the use of "flat" organizational structures, in which regular employees can talk with
12312-599: The American propensity for civil association , Fukuyama argues social capital is what produces a civil society . While civic engagement is an important part of democracy and development, Fukuyama states that, "one person's civic engagement is another's rent-seeking ." Therefore, while social capital can facilitate economic development by reducing transaction cost and increasing productivity, social capital can also distort democracy if civic association enables special interest to gain special favors. However, Fukuyama argues despite
12483-506: The Internet allows for the pooling of design resources using open source principles. Using wiki models or crowdsourcing approaches, for example, a social entrepreneur organization can get hundreds of people from across a country (or from multiple countries) to collaborate on joint online projects (e.g., developing a business plan or a marketing strategy for a social entrepreneurship venture). These websites help social entrepreneurs to disseminate their ideas to broader audiences, help with
12654-457: The Internet. Startups can receive funding via more involved stakeholders, such as startup studios. Startup studios provide funding to support the business through a successful launch, but they also provide extensive operational support, such as HR, finance and accounting, marketing, and product development, to increase the probability of success and propel growth. Startup are funded through preset rounds, depending on their funding requirement and
12825-445: The actors play. Similarly, Dees et al. (2008) developed a framework to describe the key elements of the social entrepreneurship ecosystem in which they organized the elements into two broad categories – capital infrastructure and context-setting factors. More recently in 2020, Debapratim Purkayastha , T. Tripathy and B. Das extended the business ecosystem literature to the social policy and social entrepreneurship arena. They developed
12996-452: The actual or potential resources which are linked to possession of a durable network of more or less institutionalized relationships of mutual acquaintance and recognition." His treatment of the concept is instrumental, focusing on the advantages to possessors of social capital and the "deliberate construction of sociability for the purpose of creating this resource ." Quite contrary to Putnam's positive view of social capital, Bourdieu employs
13167-590: The benefits that society may reap. Entrepreneurship becomes a social endeavor when it transforms social capital in a way that affects society positively. If a person's behaviour or motives are altruistic, they show concern for the happiness and welfare of other people rather than for themselves. Social entrepreneurship is viewed as advantageous because the success of social entrepreneurship depends on many factors related to social impact that traditional corporate businesses do not prioritize. Social entrepreneurs recognize immediate social problems, but also seek to understand
13338-422: The bonding of certain individuals together upon a common radical ideal. The strengthening of insular ties can lead to a variety of effects such as ethnic marginalization or social isolation. In extreme cases ethnic cleansing may result if the relationship between different groups is so strongly negative. In mild cases, it isolates certain communities such as suburbs of cities because of the bonding social capital and
13509-698: The broader context of an issue that crosses disciplines, fields, and theories. Gaining a larger understanding of how an issue relates to society allows social entrepreneurs to develop innovative solutions and mobilize available resources to affect the greater global society. Unlike traditional corporate businesses, social entrepreneurship ventures focus on maximizing gains in social satisfaction, rather than maximizing profit gains. Both private and public agencies worldwide have had billion-dollar initiatives to empower deprived communities and individuals. Such support from organizations in society, such as government-aid agencies or private firms, may catalyze innovative ideas to reach
13680-467: The business or enterprise of an issuer; However, not every promoter is a co-founder. In fact, there is no formal, legal definition of what makes somebody a co-founder. The right to call oneself a co-founder can be established through an agreement with one's fellow co-founders or with permission of the board of directors, investors, or shareholders of a startup company. When there is no definitive agreement (like shareholders' agreement ), disputes about who
13851-537: The business they help to build. In order to create forward momentum, founders must ensure that they provide opportunities for their team members to grow and evolve within the company. The language of securities regulation in the United States considers co-founders to be promoters under Regulation D . The U.S. Securities and Exchange Commission definition of promoter includes: (i) Any person who, acting alone or in conjunction with one or more other persons, directly or indirectly takes initiative in founding and organizing
14022-422: The casual dress and playful office environment fool you. New enterprises operate under do-or-die conditions. If you do not roll out a useable product or service in a timely fashion, the company will fail. Bye-bye paycheck, hello eviction. Iman Jalali, chief of staff at ContextMedia Entrepreneurs often feel stressed. They have internal and external pressures. Internally, they need to meet deadlines to develop
14193-561: The challenges do not stop with balancing both the social and business aspects of the business. The lack of investors, who invest in social and environmental positive impact, leads to the second problem in social entrepreneurship: the pay gap. Elkington and Hartigan note that "the salary gap between commercial and social enterprises… remains the elephant in the room, curtailing the capacity of [social enterprises] to achieve long-term success and viability." Social entrepreneurs and their employees are more often receiving lower salaries, especially at
14364-544: The character of the connection between individuals. This is best characterized through trust of others and their cooperation and the identification an individual has within a network. Hazleton and Kennan (2000) added a third angle, that of communication. Communication is needed to access and use social capital through exchanging information, identifying problems and solutions, and managing conflict. According to Boisot (1995), and Boland & Tenkasi (1995), meaningful communication requires at least some sharing context between
14535-521: The co-founders are, can arise. Self-efficacy refers to the confidence an individual has to create a new business or startup. It has a strong relation with startup actions. Entrepreneurs' sense of self-efficacy can play a major role in how they approach goals, tasks, and challenges. Entrepreneurs with high self-efficacy—that is, those who believe they can perform well—are more likely to view difficult tasks as something to be mastered rather than something to be avoided. Startups are pressure cookers. Don't let
14706-482: The community. Social service industry professionals such as social workers and public health nurses work in social services , either for a government or a non-profit organization. They aim to expand social capital for individuals, communities, and organizations. Socio-economic enterprises include corporations that balance earning profits with nonprofit goals, such as seeking social change for communities. Some social entrepreneurship organizations are not enterprises in
14877-436: The company's backbone. For example, one of the initial design principles is affordable loss. Because of the lack of information, high uncertainty, and the need to make decisions quickly, founders usually use many heuristics and exhibit biases in their leadership decisions. Entrepreneurs often become overconfident about their startups and their influence on an outcome (case of the illusion of control ). Below are some of
15048-499: The company's namesake and founder, Nobel laureate and co-inventor of the transistor William Shockley ... (His employees) formed Fairchild Semiconductor immediately following their departure... After several years, Fairchild gained its footing, becoming a formidable presence in this sector. Its founders began leaving to start companies based on their own latest ideas and were followed on this path by their own former leading employees... The process gained momentum and what had once begun in
15219-595: The company. This has been described as corporate social entrepreneurship . One private foundation has staked the ground of more precise lexicon following the Newman's Own model having coined the phrase "Commercial Philanthropy" where commercial businesses are held and operated with all net proceeds going to serve social service needs. Organizations such as the Skoll Foundation , the Omidyar Network ,
15390-560: The concept to demonstrate a mechanism for the generational reproduction of inequality. Bourdieu thus points out that the wealthy and powerful use their "old boys network" or other social capital to maintain advantages for themselves, their social class, and their children. Thomas Sander defines it as "the collective value of all social networks (who people know), and the inclinations that arise from these networks to do things for each other ( norms of reciprocity )." Social capital, in this view, emphasizes "specific benefits that flow from
15561-911: The concept, the creation of which Putnam credits to Ross Gittell and Avis Vidal: Typical examples are that criminal gangs create bonding social capital, while choirs and bowling clubs (hence the title, as Putnam lamented their decline) create bridging social capital. The distinction is useful in highlighting how social capital may not always be beneficial for society as a whole (though it is always an asset for those individuals and groups involved). Horizontal networks of individual citizens and groups that enhance community productivity and cohesion are said to be positive social capital assets whereas self-serving exclusive gangs and hierarchical patronage systems that operate at cross purposes to societal interests can be thought of as negative social capital burdens on society. Similar to Putnam, Daniel P. Aldrich describes three mechanisms of social capital: Aldrich also applies
15732-402: The courses and encourage them to make them into real startups should they wish to do so. Such mock-up startups, however, may not be enough to accurately simulate real-world startup practice if the challenges typically faced by startups (e.g. lack of funding to keep operating) are not present in the course setting. To date, much of the entrepreneurship training is yet to be personalized to match
15903-448: The daily lives of people, namely, goodwill, fellowship, mutual sympathy and social intercourse among a group of individuals and families who make up a social unit.… If he may come into contact with his neighbour, and they with other neighbours, there will be an accumulation of social capital, which may immediately satisfy his social needs and which may bear a social potentiality sufficient to the substantial improvement of living conditions in
16074-406: The degree to which social capital serves as a resource – be it for public good or private benefit. Robert D. Putnam (1993) suggested that social capital would facilitate co-operation and mutually supportive relations in communities and nations and would therefore be a valuable means of combating many of the social disorders inherent in modern societies, for example crime. In contrast, others focus on
16245-404: The development of training programs and leadership development programs for social entrepreneurs. Simultaneously, research shows that as social entrepreneurs attempt to widen their impact and scale their efforts, external institutions will have a key role to play in their success. Startup company Startups typically begin by a founder (solo-founder) or co-founders who have a way to solve
16416-441: The ecosystem of social enterprises has been increasingly supported as researchers emphasize on the importance of contextual factors supporting and constraining social ventures . Researchers note that there is a need to understand the ecosystems of social enterprises, as they often operate in a context which is highly localized, interacting with small, local actors, but may also be intimately connected to other systems operating at
16587-461: The effective functioning of social groups through interpersonal relationships , a shared sense of identity , a shared understanding, shared norms , shared values , trust , cooperation , and reciprocity . Some have described it as a form of capital that produces public goods for a common purpose , although this does not align with how it has been measured. Social capital is classified into bridging and bonding. Bridging social capital refers to
16758-427: The effectiveness of their business model, marketing, and strategy. Some accelerator organizations help social entrepreneur leaders to scale up their organization, either by taking it from a local scale to a national scale or from a national scale to a global scale. Some entrepreneurship support organizations also provide mentoring and coaching to social entrepreneurs. One well-known social entrepreneur from South Asia
16929-633: The fact that people in these communities spend so much time away from places that build bridging social capital. Edwards and Foley, as editors of a special edition of the American Behavioral Scientist on "Social Capital, Civil Society and Contemporary Democracy", raised two key issues in the study of social capital. First, social capital is not equally available to all, in much the same way that other forms of capital are differently available. Geographic and social isolation limit access to this resource. Second, not all social capital
17100-531: The failures of the national government and political parties, thereby helping to undermine the Weimar Republic and facilitate Hitler's rise to power ." In this article about the fall of the Weimar Republic , the author makes the claim that Hitler rose to power so quickly because he was able to mobilize the groups towards one common goal. Even though German society was, at the time, a "joining" society these groups were fragmented and their members did not use
17271-628: The field. First, social entrepreneurs are trying to predict, address and creatively respond to future problems and often face difficulties in identifying the right problems to solve. Unlike most business entrepreneurs, who address current market deficiencies, social entrepreneurs tackle hypothetical, unseen or often less-researched issues, such as overpopulation, unsustainable energy sources, food shortages. Founding successful social businesses on merely potential solutions can be nearly impossible as investors are much less willing to support risky ventures. If entrepreneurs are able to receive funding from investors,
17442-582: The first nursing school and developer of modern nursing practices; Robert Owen , founder of the cooperative movement; and Vinoba Bhave , founder of India's Land Gift Movement . During the nineteenth and twentieth centuries some of the most successful social entrepreneurs straddled the civic, governmental and business worlds. These pioneers promoted new ideas that were taken up by mainstream public services in welfare, schools and health care. The ecosystem framework can be very useful for social entrepreneurs in formulating their strategy. The need for understanding
17613-487: The first entrepreneur. One reason that these entrepreneurs are unreasonable is that they are unqualified for the task they take on. Most entrepreneurs have not studied the skills needed to implement their ideas. Instead, they bring a team of qualified people around themselves. It is the idea that draws this team. Ethical fiber is important because leaders who are about to change the world must be trustworthy. Drayton described this to his employees by suggesting that they picture
17784-438: The focus of a World Bank research programme and the subject of several mainstream books, including Robert Putnam 's Bowling Alone , and Putnam & Lewis Feldstein 's Better Together . All of these reflections contributed remarkably to the development of the social capital concept in the following decades. The appearance of the modern social capital conceptualization is a new way to look at this debate, keeping together
17955-446: The formation and maintenance of networks of like-minded people and help to link up potential investors, donors or volunteers with the organization. This enables social entrepreneurs to achieve their goals with little or no start-up capital and little or no " brick and mortar " facilities (e.g., rented office space). For example, the rise of open-source appropriate technology as a sustainable development paradigm enables people all over
18126-591: The founders and chief executive officers informally, are done to promote efficiency in the workplace, which is needed to get their business off the ground. In a 1960 study, Douglas McGregor stressed that punishments and rewards for uniformity in the workplace are not necessary because some people are born with the motivation to work without incentives. Some startups do not use a strict command and control hierarchical structure, with executives, managers, supervisors and employees. Some startups offer employees incentives such as stock options , to increase their "buy in" from
18297-491: The founders may close or exit the startups. Sustaining effort is required as the startup process can take a long period of time, by one estimate, three years or longer. Sustaining effort over the long term is especially challenging because of the high failure rates and uncertain outcomes. Some startup founders have a more casual or offbeat attitude in their dress, office space and marketing , as compared to executives in established corporations. For example, startup founders in
18468-452: The founders themselves using "bootstrapping", in which loans or monetary gifts from friends and family are combined with savings and credit card debt to finance the venture. Factoring is another option, though it is not unique to startups. Other funding opportunities include various forms of crowdfunding , for example equity crowdfunding, in which the startup seeks funding from a large number of individuals, typically by pitching their idea on
18639-410: The founders, with a more pessimistic emphasis on the development of society. In the words of Stein (1960:1): "The price for maintaining a society that encourages cultural differentiation and experimentation is unquestionably the acceptance of a certain amount of disorganization on both the individual and social level." Jane Jacobs used the term early in the 1960s. Although she did not explicitly define
18810-416: The growth of entrepreneurial firms, improved performance of functionally diverse groups, the value derived from strategic alliances, and enhanced supply-chain relations. "A resource that actors derive from specific social structures and then use to pursue their interests; it is created by changes in the relationship among actors" (Baker 1990, p. 619). Early attempts to define social capital focused on
18981-585: The idea, and ethical fiber. Creativity has two parts: goal-setting and problem-solving . Social entrepreneurs are creative enough to have a vision of what they want to happen and how to make that vision happen. In their book The Power of Unreasonable People, John Elkington and Pamela Hartigan identify why social entrepreneurs are, as they put it, unreasonable. They argue that these men and women seek profit in social output where others would not expect profit. They also ignore evidence suggesting that their enterprises will fail and attempt to measure results which no one
19152-515: The immediate and the broader environment (economic, social, political, etc.) the organization is influenced by and reside in". The model helps identify all the actors in the complex ecosystem, the capital infrastructure and the context-setting factors. Groups focused on social entrepreneurship may be divided into several categories: community-based enterprises, socially responsible enterprises, social services industry professionals, and socio-economic enterprises. Community-based enterprises are based on
19323-620: The impact of these ventures across the globe. Policymakers around the globe may need to learn more about social initiatives, to increase the sustainability , effectiveness, and efficiency of these projects. Involvement and collaboration between private corporations and government agencies allows for increased support for carrying out social entrepreneurship initiatives, increased accountability on both ends, and increased connections with communities, individuals, or agencies in need. For example, private organizations or nonprofit organizations have tackled unemployment issues in communities. One challenge
19494-503: The importance of old institutions , in particular family and traditional communities. The concept that underlies social capital has a much longer history; thinkers exploring the relation between associational life and democracy were using similar concepts regularly by the 19th century, drawing on the work of earlier writers such as James Madison ( The Federalist Papers ) and Alexis de Tocqueville ( Democracy in America ) to integrate concepts of social cohesion and connectedness into
19665-413: The importance of community to build generalized trust and the same time, the importance of individual free choice, in order to create a more cohesive society. It is for this reason that social capital generated so much interest in the academic and political world. Social capital has multiple definitions, interpretations, and uses. David Halpern argues that the popularity of social capital for policymakers
19836-585: The interconnections with other communities are very weak or even nonexistent, then ethnic violence is quite likely. Three main implications of intercommunal ties explain their worth: This is a useful distinction; nevertheless, its implication on social capital can only be accepted if one espouses the functionalist understanding of the latter concept. Indeed, it can be argued that interethnic, as well as intra-ethnic networks can serve various purposes, either increasing or diminishing social capital. In fact, Varshney himself notes that intra-ethnic policing (equivalent to
20007-403: The larger society as a whole (versus a small community or a group of people). Compromises in social initiatives were developed, which often did not reach large audiences or help larger communities. Since the concept of social entrepreneurship has been popularized in the 2000s, some advocates suggest that there needs to be some standardization of the process in scaling up social endeavors to increase
20178-524: The last decade, Europe has developed a rapid start-up scene that has given birth to global players, including more than 70 unicorns, and has created more than two million jobs. Investment in European start-ups increased sixfold between 2010 and 2020, reaching approximately €40 billion. Europe does a poorer job of nurturing young companies because of a failure to support their development into industry leaders. Promising European start-ups then struggle to raise
20349-468: The literature in 1953 by H. Bowen in his book Social Responsibilities of the Businessman . The terms came into widespread use in the 1980s and 1990s, promoted by Bill Drayton , Charles Leadbeater, and others. From the 1950s to the 1990s, the politician Michael Young was a leading promoter of social entrepreneurship and in the 1980s, he was described by Professor Daniel Bell at Harvard University as
20520-456: The long run. Venture capital is the money of invention that is invested into young businesses which hold no historic background. Usually, the business of venture capital is highly risky but one can at the same time expect high returns as well. In the United States, the solicitation of funds became easier for startups as result of the JOBS Act . Prior to the advent of equity crowdfunding ,
20691-434: The market situation. In their 2013 study, Kask and Linton develop two ideal profiles, or also known as configurations or archetypes, for startups that are commercializing inventions. The inheritor profile calls for a management style that is not too entrepreneurial (more conservative) and the startup should have an incremental invention (building on a previous standard). This profile is set out to be more successful (in finding
20862-447: The most critical decision biases of entrepreneurs to start up a new business. Startups use several action principles to generate evidence as quickly as possible to reduce the downside effect of decision biases such as an escalation of commitment, overconfidence, and the illusion of control. Many entrepreneurs seek feedback from mentors in creating their startups. Mentors guide founders and impart entrepreneurial skills and may increase
21033-490: The most discussed topic among the founders of sociology : such theorists as Tönnies (1887), Durkheim (1893), Simmel (1905), Weber (1946) were convinced that industrialisation and urbanization were transforming social relationships in an irreversible way. They observed a breakdown of traditional bonds and the progressive development of anomie and alienation in society. The power of community governance has been stressed by many philosophers from antiquity to
21204-520: The motives and goals of social enterprises and of those in policy-making and programs are not aligned. Those in policy-making and the development of delivery of government programs tend to have different priorities than social entrepreneurs, resulting in slow growth and expansion of social initiatives. Since social entrepreneurship has only started to gain momentum in the 2000s, current social entrepreneurs are encouraging social advocates and activists to develop into innovative social entrepreneurs. Increasing
21375-642: The national and local level. In The Power of Unreasonable People , John Elkington and Pamela Hartigan describe social entrepreneurs' business structures as falling under three different models, applicable in different situations and economic climates: There are also a broader range of hybrid profit models, where a conventional business invests some portion of its profits on socially, culturally or environmentally beneficial activities. The term " Philanthropreneurship " has been applied to this type of activity. Corporate employees can also engage in social entrepreneurship, which may or may not be officially sanctioned by
21546-461: The necessary capital to expand and mature. They are forced to either relocate to the US's deep capital markets or sell themselves to larger rivals with more financial availability. As a result, start-ups in the United States can typically raise far more money—up to five times as much as in Europe. Investors are generally most attracted to those new companies distinguished by their strong co-founding team,
21717-420: The norms of reciprocity and trustworthiness that arise from them." In the view of Putnam and his followers, social capital is a key component to building and maintaining democracy . Putnam says that social capital is declining in the United States. This is seen in lower levels of trust in government and lower levels of civic participation. Putnam also suggests that a root cause of the decline in social capital
21888-471: The notions behind social entrepreneurship. No matter in which sector of society certain organizations are (i.e. corporations or unincorporated associations, societies, associations or cooperatives ), social entrepreneurship focuses on the social impact that an endeavor aims at. Whether social entrepreneurship is altruistic or not is less important than the effect it has on society. The terms social entrepreneur and social entrepreneurship were used first in
22059-850: The ones participating. At this stage the level of risk and payoff are at their greatest. The next round is called Series A . At this point the company already has traction and may be making revenue. In Series A rounds venture capital firms will be participating alongside angels or super angel investors. The next rounds are Series B , C, and D. These three rounds are the ones leading towards the Initial Public Offering ( IPO ). Venture capital firms and private equity firms will be participating. Series B: Companies are generating consistent revenue but must scale to meet growing demand. Series C & D: Companies with strong financial performance looking to expand to new markets, develop new products, make an acquisition, and/or preparing for IPO. After
22230-430: The onset of their ventures. Thus, their enterprises at times can struggle to maintain qualified, committed employees. Though social entrepreneurs are tackling the world's most pressing issues, they must also confront skepticism and stinginess from the very society they seek to serve. Another reason social entrepreneurs are often unsuccessful is because they typically offer help for those least able to pay for it. Capitalism
22401-1024: The opposite of whatever decision they are about to make tends to reduce biases such as overconfidence, the hindsight bias , and anchoring. In startups, many decisions are made under uncertainty, and hence a key principle for startups is to be agile and flexible. Founders can embed options to design startups in flexible manners, so that the startups can change easily in future. Uncertainty can vary within-person (I feel more uncertain this year than last year) and between-person (he feels more uncertain than she does). A study found that when entrepreneurs feel more uncertain, they identify more opportunities (within-person difference), but entrepreneurs who perceive more uncertainties than others do not identify more opportunities than others do (no between-person difference). Startups may form partnerships with other firms to enable their business model to operate. To become attractive to other businesses, startups need to align their internal features, such as management style and products with
22572-547: The organization but not as an end in themselves. For example, an organization that aims to provide housing and employment to the homeless may operate a restaurant , both to raise money and to provide employment for the homeless. In 2010, social entrepreneurship was facilitated by the use of the Internet , particularly social networking and social media websites. These websites enable social entrepreneurs to reach numerous people who are not geographically close yet who share
22743-761: The participants and the training. The size and maturity of the startup ecosystem is where a startup is launched and where it grows to have an effect on the volume and success of the startups. The startup ecosystem consists of the individuals (entrepreneurs, venture capitalists, angel investors , mentors, advisors); institutions and organizations (top research universities and institutes, business schools and entrepreneurship programs and centres operated by universities and colleges, non-profit entrepreneurship support organizations, government entrepreneurship programs and services, Chambers of commerce ) business incubators and business accelerators and top-performing entrepreneurial firms and startups. A region with all of these elements
22914-520: The parties to such exchange. The cognitive dimension focuses on the shared meaning, representations and interpretations that individuals or groups have with one another. Whereas some scholars, most prominently Robert D. Putnam , posit that social capital has positive ends, a sizable body of literature finds that social capital can have adverse effects. Research by Sheri Berman and Dylan Riley, as well as economists Shanker Satyanath, Nico Voigtländer, and Hans-Joachim Voth, have linked civic associations to
23085-594: The principles of customer development and Lean Startup to technology-based startup projects. As startups are typically thought to operate under a notable lack of resources, have little or no operating history, and to consist of individuals with little practical experience, it is possible to simulate startups in a classroom setting with reasonable accuracy. In fact, it is not uncommon for students to actually participate in real startups during and after their studies. Similarly, university courses teaching software startup themes often have students found mock-up startups during
23256-561: The private benefits derived from the web of social relationships in which individual actors find themselves. This is reflected in Nan Lin 's concept of social capital as "Investment in social relations with expected returns in the marketplace." This may subsume the concepts of some others such as Bourdieu, Flap and Eriksson. Newton (1997) treats social capital as a subjective phenomenon formed by values and attitudes that influence interactions. Nahapiet and Ghoshal (1998), in their examination of
23427-403: The process. Hasche and Linton argue that startups can learn from their relationships with other firms, and even if the relationship ends, the startup will have gained valuable knowledge about how it should move on going forward. When a relationship is failing for a startup it needs to make changes. Three types of changes can be identified according to Hasche and Linton: Startups need to learn at
23598-404: The prototypes and get the product or service ready for market. Externally they are expected to meet milestones of investors and other stakeholders to ensure continued resources from them on the startups. Coping with stress is critical to entrepreneurs because of the stressful nature of starting up a new firm under uncertainty. Coping with stress unsuccessfully could lead to emotional exhaustion, and
23769-547: The publication of "The Rise of the Social Entrepreneur" by Charles Leadbeater . Many activities related to community development and higher social purpose fall within the modern definition of social entrepreneurship. Despite the established definition nowadays, social entrepreneurship remains a difficult concept to define, since it may be manifested in multiple forms. A broad definition of the concept allows interdisciplinary research efforts to understand and challenge
23940-442: The purpose of a creation. Social entrepreneurs seek to transform societies at large, rather than transforming their profit margin , as classic entrepreneurs typically seek to do. Social entrepreneurs use a variety of resources to bring societies into a better state of well-being. The concept of "social entrepreneurship" is not a novel idea, but in the 2000s, it has become more popular among society and academic research, notably after
24111-421: The requirements of capital. They propose that social capital be defined as sympathy : the object of another's sympathy has social capital; those who have sympathy for others provide social capital. This proposition appears to follow Adam Smith , Theory of Moral Sentiments to some degree, but Smith's conceptualization of sympathy (particularly in the first two chapters of this work) appear more concerned with
24282-682: The right and the will to become a dominant global power. Additionally, in his essay "A Criticism of Putnam's Theory of Social Capital", Michael Shindler expands upon Berman's argument that Weimar social clubs and similar associations in countries that did not develop democracy, were organized in such a way that they fostered a "we" instead of an "I" mentality among their members, by arguing that groups which possess cultures that stress solidarity over individuality, even ones that are "horizontally" structured and which were also common to pre- Soviet Eastern Europe , will not engender democracy if they are politically aligned with non-democratic ideologies. Using
24453-409: The rise of fascist movements. Pierre Bourdieu 's work tends to show how social capital can be used practically to produce or reproduce inequality, demonstrating for instance how people gain access to powerful positions through the direct and indirect employment of social connections. An example of the complexities of the effects of negative social capital is violence or criminal gang activity that
24624-591: The risk of society having too much social capital, it is nonetheless worse to have too little and be unable to organize for public goods and welfare enhancing activity. Carlos García Timón describes that the structural dimensions of social capital relate to an individual ability to make weak and strong ties to others within a system. This dimension focuses on the advantages derived from the configuration of an actor's, either individual or collective, network. The differences between weak and strong ties are explained by Granovetter (1973). Bridging social capital refers to
24795-404: The role of social capital in the creation of intellectual capital , suggest that social capital should be considered in terms of three clusters: structural, relational, and cognitive. A number of scholars have raised concerns about the imprecision in defining social capital. Portes (2000), for example, notes that the term has become so widely used, including in mainstream media , that "the point
24966-481: The roles of acceptance or congruence – in ethics or virtue – in evaluating an individual's 'propriety of action'. Social capital is different from the economic theory of social capitalism , which challenges the idea that socialism and capitalism are mutually exclusive. In The Forms of Capital , Pierre Bourdieu distinguishes between three forms of capital: economic capital , cultural capital and social capital. He defines social capital as "the aggregate of
25137-520: The same goals and encourage them to collaborate online, learn about the issues, disseminate information about the group's events and activities, and raise funds through crowdfunding . In recent years, researchers have been calling for a better understanding of the ecosystem in which social entrepreneurship exists and social ventures operate. This will help them formulate better strategy and help achieve their double bottom line objective. The concept and terminology of social entrepreneurship emerged in
25308-561: The same sector with more or less the same activities, have an increased chance of becoming a better entrepreneur. However, some studies indicate that restarters are more heavily discouraged in Europe than in the US. Many institutions and universities provide training on startups. In the context of universities, some of the courses are entrepreneurship courses that also deal with the topic of startups, while other courses are specifically dedicated to startups. Startup courses are found both in traditional economic or business disciplines as well as
25479-479: The scope and scale of social entrepreneurship may increase the likelihood of an efficient, sustainable, and effective initiative; although it may also render social entrepreneurship more challenging. Increased participation draws more attention to social entrepreneurship ventures from policymakers and privately owned corporations. The increased involvement of corporations and governments may help to strengthen social entrepreneurship, as it may lead to policy changes and to
25650-493: The sense that the startup has the potential to grow rapidly with a limited investment of capital, labor or land. Timing has often been the single most important factor for biggest startup successes, while at the same time it's identified to be one of the hardest things to master by many serial entrepreneurs and investors. Startups have several options for funding. Revenue-based financing lenders can help startup companies by providing non-dilutive growth capital in exchange for
25821-428: The side of information technology disciplines. As startups are often focused on software, they are also occasionally taught while focusing on software development alongside the business aspects of a startup. Founders go through a lot to set up a startup. A startup requires patience and resilience, and training programs need to have both the business components and the psychological components. Entrepreneurship education
25992-466: The skills they learned in their club associations to better their society, but to encourage their values across all cultures to provide a better society for people. They were very introverted in the Weimar Republic. Hitler was able to capitalize on this by uniting these highly bonded groups under the common cause of bringing Germany to the top of world politics. The former world order had been destroyed during World War I , and Hitler believed that Germany had
26163-400: The social ventures aimed at and involving an entire community. These enterprises build on the community's culture and capital (e.g., volunteer resources, financing, in-kind donations, etc.) to empower the enterprise and the community. Socially responsible enterprises focus on creating sustainable development through their inside organization acts that focus mostly on creating societal gains for
26334-402: The stage of growth of the company. Startup investing is generally divided into six stage, namely While some (would-be) entrepreneurs believe that they can't start a company without funding from VC, Angel, etc. that is not the case. In fact, many entrepreneurs have founded successful businesses for almost no capital, including the founders of MailChimp , Shopify , and ShutterStock . If
26505-520: The start up (as these employees stand to gain if the company does well). This removal of stressors allows the workers and researchers in the startup to focus less on the work environment around them, and more on achieving the task at hand, giving them the potential to achieve something great for both themselves and their company. The failure rate of startup companies is very high. A 2014 article in Fortune estimated that 90% of startups ultimately fail. In
26676-423: The status quo: they want healthy change. This changemaking process has been described as the creation of market disequilibria through the conversion of antagonistic assets into complementarities. Social impact measures whether the idea itself will be able to cause change after the original founder is gone. If an idea has intrinsic worth, once implemented it will cause change even without the charismatic leadership of
26847-522: The structure" – that is, social capital is anything that facilitates individual or collective action , generated by networks of relationships, reciprocity, trust, and social norms. In Coleman's conception, social capital is a neutral resource that facilitates any manner of action, but whether society is better off as a result depends entirely on the individual uses to which it is put. According to Robert D. Putnam , social capital refers to "connections among individuals – social networks and
27018-488: The system as a whole. This may be one negative aspect of social capital, but seems to be an inevitable one in and of itself, as are all forms of capital. Compared to Bourdieu, Robert D. Putnam has used the concept in a much more positive light: though he was at first careful to argue that social capital was a neutral term, stating "whether or not [the] shared are praiseworthy is, of course, entirely another matter," his work on American society tends to frame social capital as
27189-466: The technology covered by the patents. Startup investing is the action of making an investment in an early-stage company. Beyond founders' own contributions, some startups raise additional investment at some or several stages of their growth. Not all startups trying to raise investments are successful in their fundraising. Venture Capital is a subdivision of Private Equity wherein external investors fund small-scale startups that have high growth potential in
27360-532: The technology to provide internet access, others using the internet to provide services. Most of this startup activity was located in the most well-known startup ecosystem - Silicon Valley , an area of northern California renowned for the high level of startup company activity: The spark that set off the explosive boom of "Silicon startups" in Stanford Industrial Park was a personal dispute in 1957 between employees of Shockley Semiconductor and
27531-464: The term social capital , her usage referred to the value of networks. Political scientist Robert Salisbury advanced the term as a critical component of interest group formation in his 1969 article "An Exchange Theory of Interest Groups" in the Midwest Journal of Political Science . Sociologist Pierre Bourdieu used the term in 1972 in his Outline of a Theory of Practice , and clarified
27702-408: The term some years later in contrast to cultural , economic , administrative capital, physical capital , political capital , social capital and symbolic capital . Sociologists James Coleman (1988), as well as Barry Wellman & Scot Wortley (1990), adopted Glenn Loury 's 1977 definition in developing and popularising the concept. In the late 1990s, the concept gained popularity, serving as
27873-401: The theoretical level (as Bourdieu believed the actions of individuals were rarely ever conscious, but more so only a result of their habitus being enacted within a particular field, but this realization by both seems to undeniably connect their understanding of the more latent aspects of social capital. According to Bourdieu, habitus refers to the social context within which a social actor
28044-404: The value derived from strategic alliances , and the evolution of communities . While it has been suggested that the term social capital was in intermittent use from about 1890, before becoming widely used in the late 1990s, the earliest credited use is by Lyda Hanifan in 1916 (see 20th century below). The debate of community versus modernization of society and individualism has been
28215-434: The vision of implementing it. Drayton says that, "Entrepreneurs have in their heads the vision of how society will be different when their idea is at work, and they can't stop until that idea is not only at work in one place, but is at work across the whole society." This manifests through a clear idea of what they believe the future will look like and a drive to make this come true. Besides this, entrepreneurs are not happy with
28386-421: The weak ties individuals form in heterogeneous limited interactions that is more likely to provide valuable new information. Bonding social capital refers to strong ties where the intimate relations people feel close to and trust. Social capital has been used to explain the improved performance of diverse groups, the growth of entrepreneurial firms, superior managerial performance, enhanced supply chain relations,
28557-422: The weak ties that individuals with heterogeneous limited interactions form. Bridging social capital is more likely to provide valuable new information (Moshkovitz and Hayat, 2021). Some others describes the weak and strong ties relationship as bonding and bridging social capital. Bonding social capital refers to strong ties: the intimate relationships people feel close to and trust. The relational dimension focuses on
28728-635: The whole community. The community as a whole will benefit by the cooperation of all its parts, while the individual will find in his associations the advantages of the help, the sympathy, and the fellowship of his neighbours. Following the works of Tönnies (1887) and Weber (1946), reflection on social links in modern society continued with interesting contributions in the 1950s and in the 1960s. In particular, mass society theory – as developed by Daniel Bell (1962), Robert Nisbet (1969), Maurice R. Stein (1960), William H. Whyte (1956) – proposed themes similar to those of
28899-633: The world that could be witnessed. The high levels of transparency caused greater participation from the people and thus allowed for democracy to work better. L. J. Hanifan 's 1916 article regarding local support for rural schools is one of the first occurrences of the term social capital in reference to social cohesion and personal investment in the community. In defining the concept, Hanifan contrasts social capital with material goods by defining it as: I do not refer to real estate, or to personal property or to cold cash, but rather to that in life which tends to make these tangible substances count for most in
29070-489: The world to collaborate on solving local problems, just as open source software development leverages collaboration from software experts from around the world. The COVID-19 pandemic and the need to physically distance has further increased the significance of technologies for social ventures. Many initiatives carried out with social entrepreneurs while innovative, have had problems becoming sustainable and effective initiatives that ultimately were able to branch out and reach
29241-511: Was created when the owner of the company was pressured to engage in social behavior not conducive to firm profits. Robert Putnam , in his later work, also suggests that social capital, and the associated growth of public trust are inhibited by immigration and rising racial diversity in communities. Putnam's study regarding the issue argued that in American areas with a lack of homogeneity, some individuals neither participated in bonding nor bridging social capital. In societies where immigration
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