Proceedings of 11th International Business and Social Science Research Conference
8 - 9 January, 2015, Crowne Plaza Hotel, Dubai, UAE. ISBN: 978-1-922069-70-2
Connecting Impacting Investing with Social
Entrepreneurship through Collective Impact Actualization
Yi Wang
‘Impact Investing’ and ‘Social Entrepreneurship’ are two new terms developed in the
past decade which draw unusual attention and change the game rules in both public
and private sectors. The former refers to financial investments, apart from government
and philanthropy, that seek to produce social and environmental benefits; the latter, in
a general term, means ventures that aim at scalable social changes. However,
stepping away from their popularity and public fascination, both face serious
challenges such as field boundary/definition, impact measurement, interest
conflicts/tradeoffs, etc., especially since they are nascent areas where there is no
existing model for the validation in economic theories and actual practices. My goal in
this paper is to make sense and explore how to channel impact investing capital and
social ventures together to generate transformative and scalable social benefits with
market returns. Interestingly, most studies concentrate on the needs of either impact
investors or social entrepreneurs as a one-sided wish list. What I want to achieve is to
integrate viewpoints from both sides and explore common grounds with feasible
actions for betterment. I will start with defining the scope of social entrepreneurship as
scalable impact-oriented business practices, and then analyze in depth the reasons
for the success of the publicly and financially recognized cases. Apart from using case
studies and reports reviews of social ventures, foundations and firms from past
decades as qualitative data, I’d also like to leverage insights and findings from more
quantitative measurement systems and metrics such as IRIS and GIIRS to present
how the benefits are evaluated and harvested. What I’d like to propose is that the
most scalable and transformative benefits of social ventures, socially and financially,
are driven by collectives impact. Collective Impact, rather than isolated venture
activities, looks at the formation and development of community, sector and value
chains. Ventures series, or individual venture within existing collective impact loop that
strives for a common goal, can leverage resources and benefits even if they are not in
the same sector. The implication for social entrepreneurs is to tackle social issues
from root-cause analysis and scenario modeling, and position one’s business into a
value chain within an organizational network. The implications for impact investor are:
1) not only evaluate venture performance on individual social and market returns, but
also compare it with related sectors and situate it in a value network and measure the
connectivity within; 2) not only diversify portfolios in different sectors, but also form
portfolios of social ventures that generate mutually reinforcing benefits in the same
value chain and shared measured system.
Track: Management
_________________________________________________
Yi Wang, Independent Researcher (graduated from University of Pennsylvania in May 2014), USA,
Email address: yiwang9228@gmail.com