Beyond the Cheque: how venture philanthropists add value (original) (raw)
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Social Entrepreneurship and Venture Philanthropy: A Conceptual Framework
The SAIMS 27th Annual Conference Proceedings, 2015
We set out to develop a conceptual framework that integrates the social entrepreneurship and venture philanthropy literature. We rely on entrepreneurship theory to do this: in particular, the perspective of entrepreneurship as an individual-opportunity nexus. This perspective is fitting since individuals interested in social entrepreneurship require the resources of venture philanthropists to exploit opportunities in the social space. In the move to understand how social entrepreneurs interact with venture philanthropists to solve social problems in a variety of contexts – within developed and developing countries, for example-we hope that our conceptual framework can serve future research as a basis to examine and compare this interaction against different contexts. We provide the " what " of this interaction so that researchers can proceed to better understand the " how. "
Beyond Philanthropy: When Philanthropy Becomes Social Entrepreneurship
Among traditional beneficiaries of philanthropy, non-profit organizations have always enjoyed a central place. Along with historians, it is easy to argue philanthropic behaviours are among the very roots and probably the stronger root of the non-profit sector. In the last two decades however, this traditional and very close relation between philanthropy and the non-profit sector has been revisited and has begun to be partly reshaped by new forms of philanthropy, especially what is increasingly named "venture philanthropy" (VP) as well as by new businesslike actors, often called "venture philanthropists" (VPs), who are driven by an entrepreneurial spirit focused on achieving social impacts while borrowing their specific practices and vocabulary from finance and venture capital references. Since they want to break away from old-fashioned ways of giving, VPs are described as concentrating their support on innovative answers to social challenges, often carried on by "social entrepreneurs". Moreover, venture philanthropists desire "a close relationship with the social entrepreneur" (Pepin, 2005: 167). They invest, not only money, but also time, skills, talent, expertise, strategic thinking, and management experience (Wagner, 2002; Knott, McCarthy, 2007). Consequently, VPs establish long-term support and relationship for fewer projects, sometimes even only one launched by a highly promising social entrepreneur.
The aims of this paper is to systematize the approaches to the problems of contemporary changes in the relations between venture philanthropy and others social entrepreneurship. The paper is going show differences between American (USA) and European conceptions of venture philanthropy. The study is trying to approach opportunity of using Anglo-Saxon strategies for supporting development of VP in Central and Eastern Europe (including Poland). The analysis attempts to identify the concept and scope of venture philanthropy as well the relationships between VP and others social entrepreneurship. This study examines as well importance of venture philanthropy in the less economically developed countries. The paper is trying to analyze the benefits of VP and the challenges facing philanthropy in its transformation. The study focus on finance of venture philanthropy and on new, results-oriented strategies.
The real venture capitalists: a review of research on business angels
2008
Business angels are high net worth individuals who invest their own money, along with their time and expertise, in unquoted companies in which they have no family connection in the hope of financial gain. They are a distinctive source of finance for entrepreneurial businesses, making significantly more seed, start-up and early stage investments than venture capital funds. Governments are now increasingly targeting business angels as a means of increasing the supply of early stage venture capital. It is therefore puzzling why angel investing has attracted less attention from scholars than its significance deserves. This paper starts by making the case why entrepreneurship scholars should devote more attention to angel investing. It then reviews the research that has been undertaken on business angels and their investment activity since the seminal work of William Wetzel jr. published in 1981. The review covers definitional and measurement issues, angel profiles, the investment process (deal flow, screening and evaluation, negotiating and contracting, and post-investment relationships) and the evolution of the market. The paper concludes by suggesting priority areas for future research on the topic.
2010
This paper uses emerging findings from an ongoing study of contemporary entrepreneurial philanthropy. It considers the historical and theoretical antecedents of such philanthropy and its current practice. The paper seeks to develop theoretical understanding of contemporary entrepreneurial philanthropy by considering the relevance of Capital and Agency theories. The paper contributes empirically by presenting a discussion of the capital possessed by 100 UK entrepreneurs involved in philanthropy and considering the implications of these for their engagement in philanthropy. The paper contributes to current discourse regarding the nature of entrepreneurship while developing understanding of contemporary entrepreneurial philanthropists.
Finance or Philanthropy? Exploring the Motivations and Criteria of Impact Investors
Purpose – The growing prevalence of social entrepreneurship has been coupled with an increasing number of so-called “impact investors.” However, much remains to be learned about this nascent class of investors. To address the dearth of scholarly attention to impact investing, this study seeks to answer four questions that are central to understanding the phenomenon: What are the defining characteristics of impact investing? Do impact investors differ from traditional classes of investors and, if so, how? What are the motivations that drive impact investment? And, what criteria do impact investors use when evaluating potential investments? Design/methodology/approach – A partially inductive study based on semi-structured interviews with 31 investors and ethnographic observation was conducted to explore how impact investors differ from other classes of investors in their motivations and unique criteria used to evaluate ventures seeking investment. Findings – This study reveals that impact investors represent a unique class of investors that differs from socially responsible investing, from other types of for-profit investors, such as venture capitalists and angel investors, and from traditional philanthropists. The varied motivations of impact investors and the criteria they use to evaluate investments are identified. Originality / value – Despite the growing practitioner and media attention to impact investing, several foundational issues remain unaddressed. This study takes the first steps toward shedding light on this new realm of early-stage venture investing and clarifying its role in larger efforts of social responsibility.