MGT 340 Chapter 16 Social Entrepreneurship (2023-2024) Study Guide PDF

Chapter 16: Supporting Social Entrepreneurship Dr. Kipp A. Krukowski MGT 340 – Fundamentals of Entrepreneurship The Role of Social Entrepreneurship • Social Entrepreneurship - innovative solutions to social and environmental problems • Social entrepreneurs measure performance by advancing goals...

Chapter 16: Supporting Social Entrepreneurship Dr. Kipp A. Krukowski MGT 340 – Fundamentals of Entrepreneurship The Role of Social Entrepreneurship • Social Entrepreneurship - innovative solutions to social and environmental problems • Social entrepreneurs measure performance by advancing goals (social and environmental) • Protect future generations - empathy, compassion, and commitment Wicked Problems • Wicked problems - Complex social problems with no clear solution – • Examples: • Environment • Poverty • Sustainability • Equality • Education • Child mortality • Sanitation • Terrorism • Health Pose challenges and opportunities to social entrepreneurs Types of Social Entrepreneurship • Social Purpose Ventures - Aim is to resolve a social problem and make a profit • Enterprising Nonprofits - Both the venture mission and the market impact are for social purposes – Any profits made must be channeled back into the organization – Include: • Earned-income activities - Used as a source of revenue generation • Example: Goodwill Capital Markets for Social Entrepreneurs • Impact-investment funds - Look for a return on investment and to make a social or environmental impact – Examples: Clean energy • Community fund - Invest in economic development (job creation in impoverished area) • Microfinance - Financial services to people ineligible to receive banking services – Kiva (nonprofit organization) provides microloans Stakeholders • Three primary attributes of stakeholders to consider: – Power – Legitimacy – Urgency Corporate Social Responsibility (CSR) • Efforts taken by a corporation to address the company’s effects on environmental and social well-being in order to promote positive change • ESG - Environmental, Social and Corporate Governance • CSR aims to make a business accountable, ESG criteria make its efforts measurable • Customers may view product as higher quality • Legal system may be more lenient on companies with good track records Global Entrepreneurship Monitor (GEM) • GEM measures entrepreneurial activity across 112 economies • Gathers data on various groups: – Potential entrepreneurs – believe they have the capacity and know-how without fear of failure – Nascent entrepreneurs – business less than 3 mo. old without generating salary for the owners – New business owners – individuals actively involved in the business (3 mo. – 3.5 years) The Entrepreneurship Ecosystem • Financial resources Established business owners – those active greater than 3.5 years • Support from government • Entrepreneurship Education Necessity-based entrepreneurs – pushed into starting a business • Research and Development (R&D) transfer • Commercial and Legal Infrastructure Opportunity-based entrepreneurs – start business to create or exploit opportunity with main driver being independence or increasing their income • Entry Regulation • Physical Infrastructure • Cultural and Social Norms – – – What makes a country entrepreneurial? 3 Key Points • Social entrepreneurship is a growing trend with many opportunities worth pursuing for both economic and social impact. • There is interest from communities and investors in helping entrepreneurs tackle tough issues. • Entrepreneurship is globally diverse. There are hundreds of millions of entrepreneurs worldwide. It is essential for each country around the world to build a climate where entrepreneurship can thrive. Questions? Dr. Kipp A. Krukowski MGT 340 – Fundamentals of Entrepreneurship