Judging a Book by Its Cover: The Role of Corporate Form in Social Enterprise Start-Ups

29 Pages Posted: 8 Dec 2014

See all articles by Elizabeth A.M. Searing

Elizabeth A.M. Searing

University of Texas at Dallas - Public and Nonprofit Management

Date Written: September 30, 2014

Abstract

The demand for social goods not met by the government has traditionally been met by the nonprofit sector; over the last decade, however, rising social awareness in the private sector and the use of earned revenue models in the nonprofit sector have led to a new type of organization: the for-profit social enterprise. Many new corporate forms have been born to exploit this new market niche; however, the factors that will determine which of these new species will survive and thrive are unknown. This paper explores the role of corporate form in a small geographical niche of social entrepreneurs with enterprises under two years old. First, contrary to expectations, we find a lack of interest and uptake in specialized corporate forms compared to general ones. Second, once the characteristics of the enterprises have been mapped, the wide within-form variation reinforces the generalist conceptualization of the most popular form. Finally, we develop a scale to compare the forms across the mission-market spectrum and find evidence that justifies the inclusion of existing corporate forms such as the LLC as an essential part of the organizational form discussion in social enterprise.

Keywords: social enterprise, ICSEM

Suggested Citation

Searing, Elizabeth A.M., Judging a Book by Its Cover: The Role of Corporate Form in Social Enterprise Start-Ups (September 30, 2014). Available at SSRN: https://ssrn.com/abstract=2534782 or http://dx.doi.org/10.2139/ssrn.2534782

Elizabeth A.M. Searing (Contact Author)

University of Texas at Dallas - Public and Nonprofit Management ( email )

800 West Campbell Road
Richardson, TX 75080
United States

HOME PAGE: http://www.elizabethamsearing.info

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