Academic literature on the topic 'Prosocial venturing'

This study develops an understanding of the role of emotional connectivity for volunteer retention in prosocial business venturing. By embedding it in organizational ambivalence theory, our analysis of four volunteer-dependent community ventures reveals two mechanisms through which entrepreneurs strengthen volunteers’ emotional connectivity. We first identify emotion-focused practices that form volunteers’ emotional attachment to the venture, and then demonstrate how duality-focused practices, in the form of managing inherent organizational duality, complement emotion-focused practices to foster volunteers’ emotional loyalty to the venture. Theorizing from our findings, we introduce a model of managing volunteers’ emotional connectivity, and conclude by discussing its implications for prosocial venture research on volunteerism and affective commitment.

In the context of the humanitarian refugee crisis in Germany, we conducted an 8-month qualitative study of prosocial ventures that emerged during this crisis to build a theory of motivation in prosocial venturing. We identified two venturing paths driven by founders’ distinct motivations. Founders motivated by others’ suffering focused on rescuing refugees, following an execution-oriented approach, and scaling their activities to meet victims’ short-run needs. Founders motivated by entrepreneurial aspirations focused on building an organization, following a foundation-oriented approach, and customizing activities to meet victims’ long-run needs. This study contributes to prosocial venturing and crisis research.

One of entrepreneurs’ key tasks is mobilizing resources from external resource holders. Although we know how entrepreneurial ventures gain initial access to resources, we do not yet fully understand how they maintain their resource mobilization, particularly in the face of potential threats. During our 11-month study of prosocial ventures that emerged to alleviate the suffering of refugees in Germany, four attacks on the European public occurred that were allegedly committed by refugees. These attacks disrupted the German welcoming culture for refugees, potentially threatening the legitimacy of the prosocial ventures’ core activities. Thus, the attacks provide a starting point for examining how new prosocial ventures are able to maintain access to resources in the face of the potential withdrawal of resource holders. Theorizing from our data, we identify three distinct approaches to explain how prosocial ventures responded to the potential threat undermining the legitimacy of their activities to maintain access to resources. These approaches differ in their initial resource mobilization (i.e., based on the venture’s goal for alleviating suffering), threat appraisals, and responses to maintain resource mobilization in the face of the potential delegitimization of their core activities. Our model provides novel insights into resource mobilization and prosocial venturing.

Abstract Despite the relevance of crowdfunding as a financing tool for underrepresented entrepreneurs, prior research pays scant attention to the funding gap for refugee entrepreneurs. Using a composite framework that integrates both entrepreneurship research and signalling theory, the current study investigates how microfinance institutions (MFIs) and refugee entrepreneurs can deploy signals to pursue entrepreneurial opportunities on digital platforms. The results, based on refugee data pertaining to 5615 loans on Kiva during 2015–2018, reveal that when refugee loan campaigns are affiliated with an MFI that itself features lower default rates, achieves high profitability, adopts an entrepreneurial support orientation, operates transnationally and is digitally focused, the campaign achieves better crowdfunding performance outcomes than refugees campaigns affiliated with an MFI that lacks these features. These findings provide clear evidence that when MFIs offer reputational signals, visible to the crowd of lenders, it can increase entrepreneurial financing and democratize resource acquisition among financially excluded refugee entrepreneurs. Plain English Summary Can microfinance institutions boost crowdfunding among refugee entrepreneurs and their small businesses? Yes, they can. Third-party signals may support growth in alternative finance for #refugees. While research on entrepreneurship has largely targeted immigrant entrepreneurs, the refugee context has been neglected, namely how refugee entrepreneurs fund their economic activities. With signalling literature on new venture financing of entrepreneurship being greatly fragmented, we contribute to the understanding of how crowdfunding microfinance boost venture financing of refugees. We study the gain of legitimacy by refugee entrepreneurs displayed through reputational signals intertwined with the reputation of microfinance institutions (MFI). Our results reveal higher success in funding outcomes when the loan campaign is linked with microfinance institutions with lower loan default rates, higher profitability, driven by entrepreneurial support, operating internationally and with a digital presence, compared with MFI that lacks these features. Our work has relevant implications for underrepresented refugee entrepreneurs, crowdfunding actors, policymakers and scholars. Our findings indicate that the affiliation between refugees-microfinance institutions creates certain reputational signals which enhance entrepreneurial finance and shape conditions for societal integration in the host country. For crowdfunding platforms, we show that to develop an effective, self-perpetuating entrepreneurial ecosystem, they should work to build their reputation among lenders, by capitalizing on and making third-party signals more readily available. At the same time, they must conduct due diligence to assess and monitor MFIs’ behaviour. Policy makers are recommended to build up on this digital microfinance experience to enhance new venturing finance refugee programs. We, thus, extend prior findings about the importance of third-party affiliations by establishing a composite framework of third-party signals in the context of new venture financing for financially excluded communities, and refugees in particular. Accordingly, for scholars, we offer cross-disciplinary insights into which characteristics of intermediaries can facilitate links between the supply (crowd of lenders) and demand (refugee entrepreneurs) sides in prosocial crowdfunding.