The Formation and Interplay of Social Capital in the ORFE Processes of Crowd Funded Social Ventures
Lehner, O. M. (2014). The formation and interplay of social capital in crowdfunded social ventures. Entrepreneurship & Regional Development, 26(5-6), 478-499.
23 Pages Posted: 1 Mar 2014 Last revised: 19 Nov 2018
Date Written: September 1, 2013
The multi-leveled processes taking place in crowdfunding, when tapping a large heterogeneous crowd for resources, and the often fundamentally different intentions of individual crowd members in the case of highly desirable social ventures with little prospect for economic gains, may lead to a different logic and approach to how entrepreneurship develops. The author therefore seeks evidence and a new understanding of these processes by using the sociological perspectives of Bourdieus’ four forms of capital: social, cultural, symbolic and economic, on 36 cases of social ventures. In the cases, opportunity recognition, formation and exploitation could not be distinguished as separate processes. Crowdfunding and sourcing helps form the actual opportunity and disperse information at the same time. In addition, the ‘nexus’ of opportunity and entrepreneur is breached in crowdfunding of social causes through the constant exchange of ideas with the crowd, leading to norm-value pairs between the funders and the entrepreneurs. Issues of identification and control are thus not based upon any formal relationship but based on perceived legitimization and offered democratic participation. Success in seeking funds from the crowd ventures is based upon the original social capital of the entrepreneurial teams, yet the actual resource exchange and transformation of capital is highly moderated by cultural and symbolic capital. Crowdfunding seems an ideal match for entrepreneurs seeking for ‘societal’ value more than for economic gain. While the entrepreneurs act as catalysts, members of the crowd take over various roles at the same time, from co-founders to funders as well as to customers and co-workers.
Keywords: opportunity recognition, crowdfunding, social entrepreneurship, social capital
JEL Classification: G15, G24, M13
Suggested Citation: Suggested Citation