Relationships Between Founder

Background, Issue Severity, and

Innovation in Social Entrepreneurship

Initiatives 

Steven Dell’Amore; Mallory Rothstein; Melissa Cuesta;

Katie Stockhammer-DeSimone; Manuel London, Ph.D.

Stony Brook University College of Business

Goals

1) Examine the types of social entrepreneurship initiatives that are exemplars deserving of awards and additional resources.

What it takes for an initiative to receive national and international recognition as a model—types of problems

they address, how long it takes to be recognized, and prior experience of the entrepreneurs.

Goals

2) Study the extent to which the past experience of the social entrepreneur and the severity and complexity of the problem affect the solution and the degree of improvements achieved.

General hypothesis: More experienced founders (those that had been entrepreneurs) and more severe problems will produce more innovative methods and generate more social improvement (Edmondson, 2012; Lavie, Stettner & Tushman, 2010; Lee & Nelson, 2005; March, 1991).

Sample

121 social entrepreneurship initiatives highlighted

on five websites during 2012:

• Skoll Foundation (n=40)• Ashoka (n=33)• Fast Company (n=27)• BBC World Challenge (n=10)• Schwab Foundation (n=11)

Rating Process

• Four trained raters judged a subsample of the initiatives. They discussed their ratings and resolved any disagreements.

• Then at least two coders rated each of the remaining initiatives.

• Different pairs of coders were randomly assigned to the initiatives.

• The pairs reviewed their categorizations and ratings with each other and resolved any disagreements.

Variables• Age of the initiative

• Type of problem

• Past experience of founder

• Gender of founder

• Severity and Complexity of the problem

• Use of new methods and technologies

• Favorability of outcomes

Descriptive StatisticsExperience:

41% (n=49) of the founders had past experience either as an

entrepreneur or in a business prior to starting their social

entrepreneurship initiative.

Gender:

38% (n=39) of the founders were women. (Six initiatives did not have a

single principal founder to attribute past experience or gender.)

Initiative age:

The initiatives had a mean age of 17 years, ranging from less than 5

years (4 of the initiatives) to 25 years or more (13 of the initiatives).

Types of Issues Represented

• 22% (n=25 initiatives) addressed four or more categories of social issues.

Most frequently addressed issues:

• Social injustice (59%)• Poverty (57%)• Disease (18%)• Environment (17%) • Violence (12%)• Conflict in a region (12%)• Prejudice (7%)

Problem Severity

• For each type of problem that applied to an initiative, coders rated the severity of the problem (1=lowest to 3=highest).

• The severity ratings were then added to derive an overall severity index (ranging from 1 to 27) across nine categories of possible problems for each initiative.

• 71% of the organizations had ratings of 5 or more on this index; 19% were scored 10.5 or higher.

Complexity & Scalability

Ratings on 5-point scales with 1=low, 1.5, 2, 2.5, 3=high.

70% of the organizations were considered to have

complex problems, with ratings ranging from 2.5 or 3.

By scalability, we rated how easily this solution could be replicated.

68% were rated 3 on scalability.

Use of New Methods & Technologies

• 60% applied new methods & technologies.

• 39% adapted existing methods.

• Therefore, generally, the initiatives in the sample dealt with multiple problems that could be deemed severe and complex and required novel solutions.

Outcome Favorability

• Rated on a scale ranging from 1(low) – 3(high) on each of four areas: economic, health, education, overall quality of life.

• These ratings were summed to produce an overall impact score ranging from 1-12. (Mean=8.5, SD=2.7)

Intercorrelations

• Older initiatives addressed more severe problems (r=.27, p< .01) and showed more favorable outcomes (r=.16, p<.05).

• More severe problems showed more positive outcomes (increased improvement) (r=.33, p<.01).

• Initiatives that used new methods and technologies had more favorable outcomes (r=.15, p<.05).

Gender

• Women were founders of older enterprises (r=.16, p<.05) and produced greater impact (r=.19, p<.05).

• This may be because women were more likely to start social initiatives, and they produced greater impact because they had been engaged in the initiative longer.

• Future research should explore the effects of the social entrepreneur’s gender in relation to past experience, innovation, and impact.

  Total Sample Male Founders Female Founders

b      Intercept .18 .01 .22Experience of Founder

.07 .15 .04

Age of Initiative

.00 .00 .00

Problem Severity

.01 .00 .00

Project Complexity

.32** .28** .32

R2 .14*** .14* .10N 121 76 39

Predicting Applying New Methods and Technologies

Predicting Favorable Outcomes

  Total Sample Male Founders Female Founders

b      Intercept    6.12***    5.62***    6.36***Experience of            Founder

.62 .64 .92a

Age of Initiative .03 .04 .03Problem Severity  .22* .19* .29*Project   Complexity

.00 .47 .62

Applying New Methods &Technologies

1.24* .87 1.54**

R2   .15** .12  .48**n 121 76 39

Conclusions

• Overall, more severe problems did not produce more novel methods.

• Severe problems that used more novel methods produced more favorable outcomes.

• Applying new methods and technologies is complex, but it is the innovation, not the complexity, that produces favorable outcomes.

Conclusions

• Women may be more sensitive to severity of the problem and develop innovations in methods and technologies to deal with problems and produce a high impact.

• Men may be less likely to innovate for severe problems, turning to adaptations of tried and true methods, but, as suggested by the prior analyses, are likely to generate new methods and technologies to deal with complex problems.

Unexpected Finding

Age of initiatives (M=17 years): They were not start-ups.

• To be recognized, they needed to be established and demonstrated positive outcomes, not necessarily new methods and technologies.

• Therefore, to receive funds and be recognized for achievement takes time.

• Other foundations may be more likely to support new and novel ideas, such as social enterprise academies

ConclusionsThe foundations recognized initiatives that deal with a wide range of problems, and these problems tend to be difficult.

Many of the initiatives used novel methods. This was one reason they were recognized, no doubt.

But other initiatives in the sample used more tried and true methods to deal with severe problems, and these initiatives were recognized as well.

Not surprisingly, initiatives whose problems were more severe, and that were older, had the most impact.

ConclusionsWomen have been involved as leaders of social initiatives for many years, and they were likely to be recognized by the foundations.

Half the sample had prior business or entrepreneurship experience, but half did not.

This suggests that individuals who do not have much or any prior experience should not hesitate to be leaders solving social problems.

Training programs that exist now to help these individuals may give them an extra boost so that their endeavors will show positive impact sooner and not take as long as many of those in our sample to be recognized for their achievements.

Conclusions

The foundations preferred to recognize projects that were more comprehensive in their approach and tackled difficult issues.

Endeavors that have shorter time frames to success perhaps, because they have more narrow objectives, may have been less likely to be recognized.

Conclusions

• Males tended to develop complex, novel methods and technologies somewhat more than females.

• However, for females, when the problem was severe and they invented new methods and technologies, they produced more positive outcomes, whereas severity and use of new methods did not significantly predict outcomes for male founders.

Limitations• Sample

• Cross-sectional ratings (multiple raters and integration

method was used to avoid response biases)

• Did not study actual processes as they developed over

time

• Did not contact initiatives directly

Future ResearchReplicate current study with a larger sample and in-depth data

from the founders and stakeholders and objective indicators of success.

Compare exemplars, such as those in this study, to more mundane yet still valuable initiatives (e.g., food pantries or health clinics—initiatives that are not innovative, per se, but still required resources) to show different results or may show that impact can be achieved in different ways.

Future Research

Understand differences in how men and women approach problems by inventing new methods and technologies, as opposed to relying on new applications of more tried and true methods, should be investigated.

Future ResearchStudy team processes. Organizational theory would suggest that the

more the founding team used exploratory processes to brainstorm and experiment with various possible applications, the more innovative the resulting method would be.

Study how much the initiative evolved from the early conceptualization of the problem(s) and solutions to the current situation.

Identify the partner organizations that were early forms of support. We would want to know the extent to which the social entrepreneur faced opposition or naysayers, had to advocate on behalf of the beneficiaries, and/or garnered others’ support to build the organization.

Open Questions

How do social entrepreneurship teams arrive at their solution, or set of solutions?

How are the methods established and how do they evolve? Were they novel to begin with, and if so, what process did the founders use to generate their ideas?

The source foundations recognize more established initiatives that vary in focus, severity, and project complexity.

Foundations may wish to identify more recent start-ups, those that show promise but have not yet produced results.

Understanding differences between how male and female founders approach problems and what drives identifying new methods and technologies is another area for worthwhile investigation.

Relationships Between Founder Background, Issue Severity, and Innovation in Social Entrepreneurship

Initiatives

Questions or Comments?

Steven Dell’Amore; Mallory Rothstein; Melissa Cuesta;

Katie Stockhammer-DeSimone; Manuel London, Ph.D.

Stony Brook University College of Business