Abstract
In the abundant literature on social entrepreneurship, little attention is paid to the creation process of hybrid social ventures, beyond the assumptions that they are originated by market failures and are born to alleviate a social problem. Using a qualitative approach based on semi-structured interviews, the authors derive a process model explaining the creation of hybrid social ventures through effectuation and bricolage. They show that these decision-making tools may play a role in the creation process and that the new venture may have the defining characteristics of opportunity creation. They conclude that for a new venture to be created as a hybrid firm, a dual mission-goal with a social problem as the trigger and a financial goal to ensure sustainability are required.
TopIntroduction
The abundant literature on social entrepreneurship and hybrid social ventures is centered on definitions, on the extent of an organization’s hybridity, on their origin and purpose, as well as on success, sustainability, and survival factors. The literature also focuses on how to manage the tension between social and financial goals, and on the organizational implications of the hybrid form. However, little attention is paid to the creation process of hybrid social ventures, beyond the conceptions that they are born as such and are created with a purpose or that they are former business or charitable organizations that have evolved into a hybrid form over time (Holt & Littlewood, 2015). The aim of this research is to increase our understanding of how hybrid social ventures are created, how their creation process unfolds, how early decision-making takes place, and how opportunities for this type of firms are identified. Filling this void is important because hybrid social ventures are growing in numbers and recognition of business opportunities is the first and most critical step in business venturing.
The issues of how hybrid social ventures are created and how opportunities for this type of firms are identified need to be addressed because organizations merging business and social missions (Lee & Jay, 2015) may play a role in resolving or alleviating social and environmental problems, more than initiatives coming from governmental institutions or not-for-profit organizations. Hybrid social ventures pursue social impact goals (Haigh, Walker, Bacq, & Kickul, 2015) and perform activities that generate societal impact (Santos, Pache, & Birkholz, 2015), but simultaneously seek to achieve financial sustainability through revenue generation from trading (Di Domenico, Haugh, & Tracey, 2010). Unlike governmental institutions and not-for-profit organizations that depend on taxation and donations, respectively, hybrid social ventures “self-finance” their social impact activities and, hence, can be a more effective solution.
Key Terms in this Chapter
Bricolage: Decision-making tool that helps entrepreneurs to create a new venture when the available resources are scarce.
Opportunity Creation: While some opportunities exist out there waiting to be discovered by alert entrepreneurs, others must be created by the actions of the entrepreneur.
Hybrid Social Venture: Venture that combines a social and financial goals in its mission statement.
Effectuation: Theory of entrepreneurship that prescribes creating effects from the available means by combining the resources at hand with contingencies.