Press releases | Development Cooperation 26.11.2014

Large-scale exploratory study takes the pulse of social enterprises and their ecosystems in emerging markets.

Panel Discussion „Cultivating an Ecosystem for Social Entrepreneurs”

On Wednesday, the 26th of November, Zeppelin University and Siemens Stiftung presented the results of their recent study on social enterprises and their ecosystems at the Tecnológico de Monterrey in Mexico City. This first large-scale survey in emerging markets with a focus on Colombia, Mexico, Kenya and South Africa provides exploratory information on the organization and financing of social enterprises. The study was conducted with 286 social enterprises and 148 social investors as well as other funders of social enterprises in these specific countries.

The study is a result of the International Research Network (IRENE | SEE) launched by Siemens Stiftung and Zeppelin University in 2011. It will available for download on the Siemens Stiftung and the Zeppelin University websites from the end of 2014 / beginning of 2015. The two-year study was conducted by Lisa M. Hanley, Aline Margaux Wachner and Tim Weiss from the Chair of Prof. Stephan A. Jansen at Zeppelin University.

Amongst many highly relevant findings that seek to ground the debate on social enterprises and their corresponding ecosystems in emerging markets, the study results show that end consumers pay directly for the products or services provided by over 50% of social enterprises. This limits the ability of social enterprises to target the poorest populations. In contrast, those social enterprises mainly generating revenue from donors, NGOs or governments have a stronger focus on the poorest of the poor.

The survey further shows that funders of social enterprise preferably support newly founded for-profit or dual-structured social enterprises. The latter refers to the legal form of a combination of nonprofit and profit organizations. The study reveals that social investors strongly favor highly educated social entrepreneurs: Over 76% of social enterprise founders, who have received financial or technical support, hold either a master’s degree, MBA or PhD. This can be attributed to the complex challenges in the management of social enterprises and provides conclusions on the selection criteria of who is funded in the eco-system.

The authors of the study presented the key findings of the study at the beginning of the panel discussion “Cultivating an Ecosystem for Social Entrepreneurs – The role of Investors, Researchers and Philanthropy” at the Tecnológico de Monterrey at 4.30 pm, 26th November 2014.

Among the panelists were:

  • Jorge Camil (Co-Founder and CDO of the Mexican social enterprise ENOVA),
  • Rodrigo Villar (Co-founder of the incubator New Ventures Mexico and the impact investment fund Adobe Capital)
  • Katia Dumont (Head of the Central American Chapter of the Aspen Network of Development Entrepreneurs, ANDE)
  • Lisa Hanley (Researcher of Zeppelin University)
  • Rolf Huber (Managing Director of Siemens Stiftung).

Siemens Stiftung supports social entrepreneurs serving people in need in developing countries by facilitating cross-sector collaboration as well as in own operative projects. In this context the foundation also supports research on social entrepreneurship through the international IRENE | SEE network and is a presenting partner at the research conference of the Global Social Business Summit 2014 in Mexico City, where members of the research network will be contributing to the academic discussion.

Background Information about the Study

Prior to sending out the online survey, 148 social investors (including facilitators such as incubator and accelerator programs) were identified through Internet research and field visits according to the  snowball principle. These investors constituted the first basis of data.  On this basis, 1,124 portfolio organizations formed the second  basis of data. In total, 36 social investors (24%) and 286 social enterprises (25%) responded. These responses formed the basis for the above-mentioned findings.

International Research Network on Social Economic Empowerment (IRENE | SEE)

Siemens Stiftung and Zeppelin University launched the International Research Network IRENE I SEE (International Research Network for Social Economic Empowerment) in 2011. The aim of the project is to research organizational approaches that foster “Social Economic Empowerment” - understood, in this context, as the process of economic self-empowerment through professional assistance. The main focus lies on entrepreneurial solutions to social problems such as social enterprises, which in the last decades have increasingly been discussed as a promising complement to traditional development cooperation.

Siemens Stiftung

Siemens Stiftung operates in the fields of basic services, education, and culture. As a hands-on foundation, it develops its own projects and implements them with a view to the long term. In its working area Basic Needs and Social Entrepreneurship, Siemens Stiftung empowers people to lead independent and dignified lives. The goal is to reduce existential care needs and strengthen necessary social structures. In developing and emerging countries, Siemens Stiftung focuses on the use of simple yet innovative technical solutions and combines these with training and social entrepreneurial solutions in its project work.

Zeppelin University and the Civil Society Center

Zeppelin University (ZU) is a privately endowed institution of higher education, officially recognized by the federal state of Baden-Württemberg and accredited by the German Council of Science and Humanities since 2003. As a “university between business, culture and politics” with 1,308 students, 49 professors and just under 269 staff at present, it consequently undertakes both education and research in an interdisciplinary, individualized and international spirit. Many awards have been bestowed on it – among others it was the national winner of the “Hochschule in Gesellschaft” award in 2011 for outstanding commitment to society. In the relevant rankings it has been placed in the leading group since its inception. The Civil Society Center | CiSoC was established in 2010 to undertake research into social innovations, social developments and social enterprises in particular, with financial support from numerous foundations such as the Stiftung Mercator, Siemens Stiftung and JP Morgan Chase. Currently with five staff headed by Prof. Dr. Stephan A. Jansen and many international partner universities, it runs national and international empirical projects in post-graduate programs. The Zeppelin University Staff working on the International Research Network on Social Economic Empowerment is composed of Dr. Lisa M. Hanley (project manager), Aline Margaux Wachner and Tim Weiss (PhD candidates).