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Resources of Social Entrepreneurs


3.3. The Nature of Social Entrepreneurs

3.3.4. Resources of Social Entrepreneurs

essential to combat social issues. Sustainability is another key challenge for not only social but also commercial entrepreneurs. In this direction, the determination of sustainable solutions is required to create social value eventually.

According to Braga et al. (2014), there are many challenges, difficulties, or obstacles that faced by social entrepreneurs when they not only creating but also developing a social enterprise. As claimed by the same scholars, these obstacles are emerged by the reason of unfulfilled expectations. These founded similar obstacles are can be listed as;

“the mobilization of human resources”, “the mobilization of financial resources”,

“time management”, “communication management”, “the process of decision making”, “lack of credibility”, “lack of experience”, and “bureaucracy”.

Figure 3.6. Resources of Social Entrepreneurs Source: Asılsoy (2016)

According to this, employees are referred to as the first members of non-financial resources that used by social entrepreneurs. These employees undertake a distinctive role in opposite to other employees who work in commercial enterprises. According to Kümbül Güler (2010:70), employees who work in social enterprise are more loyal, dedicated, embedded in social purpose, and focus on the quality of output they create instead of the income they earn. In general, these employees also referred as a beneficiary of social value which is created by social entrepreneurs. As second, volunteers play an essential role in the entrepreneurial activities of social entrepreneurs to maintain the venture. As stated by Sharir and Lerner (2006) these volunteers accept to work in social enterprises for free or below-market wages. Lastly, social capital stands for acting together to achieve goals and developing a network based on mutual trust and relationships. According to Stoll (2002), social capital is a network that does not consume away when it is used, on the contrary, it increases. Not surprisingly, social capital depletes when it is not used by members of this social network. As asserted by Thompson (2002), social capital consists of community-based intangible and tangible assets. According to this, tangible assets can be buildings, services, and support networks whereas intangible assets symbolize recognition, fame, and respect.

Resources of Social Entrepreneurs

Financial Resources

Market-based Resources Non-market-based


Non-financial Resources

Employees (Labor Force)

Volunteers Social Capital

3.4. The Difference Between Traditional Entrepreneurship and Social Entrepreneurship

As understood from the previous parts, traditional (also known as; commercial or business) entrepreneurship and social entrepreneurship differ in several ways. In other words, as being representatives of traditional entrepreneurship and social entrepreneurship; commercial and social entrepreneurs display not only similar but also dissimilar features within the business environment. As demonstrated in Table 3.4., the differences between commercial and social entrepreneurs were examined in detail by numerous scholars in related business literature (Barendsen and Gardner, 2004; Austin et al., 2006; Özdevecioğlu and Cingöz, 2009; Kümbül Güler, 2010;

Braga et al., 2014). These differences are explained as follows;

Table 3.4. Traditional Entrepreneur vs Social Entrepreneur Traditional Entrepreneur Social Entrepreneur Objective Build or start a new business Create a social change

Linkage Indirect Direct

Target Investors or shareholders Disadvantaged, neglected or underserved actors of society Profit Motives Desire to gain personal profits Desire to gain social profits Value Creation Financial value creation Social value creation

Risk Taking Take a risk at individual level Take a risk at community level Decision Making Decide for financial issues Decide for social issues

Measurement Quantitative (Tangible) Qualitative (Intangible) Innovation Discover the ideas and methods Unify the resources of society

Feedback Always - Certain Rare - Uncertain Return of


Economic Return Social Return

According to this comparative table, the objectives of these two sides (traditional entrepreneurship vs social entrepreneurship) are totally different. As mentioned before, building or starting a new business is the foremost objective of commercial entrepreneurs. In opposition to this, social entrepreneurs aim to benefit society (Tan et al., 2005; Peredo and McLean, 2006; Martin and Osberg, 2007; Certo and Miller, 2008) through the creation of social change, social transformation, or social impact (Barendsen and Gardner, 2004:43; Shaw and Carter, 2007). In this regard, it can be stated that social entrepreneurs link to the social problems directly while commercial entrepreneurs associates indirectly. Undoubtedly, the missions of entrepreneurs influence their profit motives too. More clearly, the primary purpose of a commercial entrepreneur is to build a business and gain financial personal profits from it (Knight, 1921; Martin and Osberg, 2007; Abu-Saifan, 2012; Tan et al., 2005), while social entrepreneurs aim to create social profit (e.g. social capital and social benefit) and change the structure of the existing social system (Kümbül Güler, 2010:58). As understood from those, social entrepreneurs target disadvantaged, neglected or underserved actors of society instead of investors or shareholders (Martin and Osberg, 2007). At the end of these processes, financial values (progress of economy) and social values (progress of society) occur respectively in traditional and social entrepreneurship (Austin et al., 2006). Risk-taking propensity is another crucial topic that causes a remarkable difference between social and traditional entrepreneurial behaviors. As declared by Özdevecioğlu and Cingöz (2009), the risk is taken by entrepreneurs individually to gain personal profit in the scope of traditional entrepreneurship. But in contrast to this, the risk is taken at the community level to respond to unmet social needs or social problems in social entrepreneurship. Similarly, decisions that are made by entrepreneurs display another striking difference among traditional and social entrepreneurs. For instance, social entrepreneurs make decisions on social issues (social needs or social problems), while commercial entrepreneurs primarily focus on financial topics (maximization of profits). In addition to these, performance measurement (success) is another essential topic for both social and traditional entrepreneurs. As stated by Dees et al. (2001), performance is measured qualitatively (how well: e.g. social impact) in social entrepreneurship whereas quantitatively (how much: e.g. profit margin, customer satisfaction, market share) in commercial entrepreneurship. Furthermore, the resources of innovation vary between

the concepts of social and traditional entrepreneurship. For instance, social entrepreneurs try to unify the diverse resources of society to get more with fewer resources (Kümbül Güler, 2010:58). On the other hand, in commercial entrepreneurship, innovation is done through discovering new ideas and methods.

When the entrepreneurial process is completed, social entrepreneurs need to determine new objectives and follow new opportunities with an aim to ensure the sustainability of their social enterprise. However, in commercial entrepreneurship, it is not necessary to undertake a new purpose to ensure continuity of business. The way of receiving any feedback constitutes another difference between traditional and social entrepreneurship. In traditional entrepreneurship, entrepreneurs are rewarded by the degree of profit as feedback. But oppositely, social entrepreneurs are rewarded rarely in social entrepreneurship (Dees et al., 2001). In this regard, it can be stated that feedback is uncertain within the border of social entrepreneurship. Furthermore, the return of investment demonstrates the last distinguishing factor between commercial and social entrepreneurs. In this regard, it can be said that social entrepreneurship concludes with a social return while commercial entrepreneurship ends with a financial return (Austin et al., 2006; Braga et al. 2014).