(Illustration by Adam McCauley)
The social sector has traditionally relied on noncommercial means, such as donations, grants, and volunteers, to pursue civic goals. But over the past three decades, as charitable resources have dwindled and social problems have grown, so-called hybrid ventures, which incorporate revenue-producing activities with nonprofit work, have become increasingly popular. Such ventures are the subject of debate and research, but until recently, their relationship with gender norms has not been carefully studied.
Women have disproportionately been associated with work that advances social welfare, while commercial activities have been stereotyped as male. How do evolving gender norms in society and the business world influence social ventures? Are newly launched nonprofits with female founders less likely to pursue commercial activities as part of their missions?
Stefan Dimitriadis, a doctoral candidate in organizational behavior at Harvard University, and three coresearchers investigated hybrid social ventures through the lens of gender. They wondered whether cultural norms about gender made female social entrepreneurs less likely to found hybrid ventures. They also wondered whether local community factors, such as a greater prevalence of female business leaders, might dampen such a cultural influence. “The creation of a hybrid social venture by a woman still requires breaking some gender stereotypes,” Dimitriadis says. “We were intrigued to understand the extent to which this was happening.”
The researchers hypothesized that the presence of female business owners in a community would have a positive impact on how women in business were viewed in that community, and that this attitude, in turn, would increase the likelihood that female social venture founders would create hybrid, rather than non-revenue-producing, ventures. To explore their theory, they analyzed a data set of 584 nascent US-based social ventures and their founders, spanning 104 communities in 44 states, during 2007 and 2008. Each venture pursued an explicit social mission, was independent, and was less than two years old. By focusing on newly launched ventures, researchers could avoid survivorship bias, such as the decisions of an organization’s founder or past leaders unduly influencing its current leader.
In creating a model for analysis, each startup studied was coded according to the degree that it used commercial activity, and each community was scored according to the prevalence of female business ownership. Control variables included the local availability of alternative funding sources, the area of social action that the venture addressed (some sectors might be more amenable to commercialization than others), whether the founder was a member of a team, and whether the project could draw on local beneficiaries. The founder’s work experience, education, and race were also controlled for.
The data set revealed that social ventures with any degree of commercial activity were more likely to be founded by men. But it also indicated that the presence of female business owners in the local community correlated positively with a greater number of female hybrid-venture founders. In fact, as the proportion of female business owners increased, the probability that a female-founded social venture would incorporate significant money-making activities increased substantially.
“This suggests that women who operate commercial ventures play an important role as role models and standard setters for women who launch noncommercial ventures,” says Susan Coleman, the Ansley Chair of Finance at the University of Hartford. “Having a higher percentage of women business owners bends the curve in terms of what is ‘normal’ and acceptable in a given community—suggesting that, at the local level, context trumps culture.”
The researchers also tested for the potential effect of the presence of women in noncommercial leadership positions in the local community, such as female congressional representatives. But they found no evidence of an effect. “It was quite surprising that the presence of women in a different sector, in this case the business sector, could influence how gendered behaviors play out in the social sector,” says Dimitriadis.
“The robustness of the findings gives added credence to the authors’ conclusions and opens a door to further research on the ways in which culture and context influence the launch, structure, and survival of womenowned social ventures, as well as their willingness and ability to employ commercialization practices,” says Coleman.
Stefan Dimitriadis, Matthew Lee, Lakshmi Ramarajan, and Julie Battilana, “Blurring the Boundaries: The Interplay of Gender and Local Communities in the Commercialization of Social Ventures,” Organization Science, 28, No. 5, 2017, pp. 819-839.
Read more stories by Marilyn Harris.