The Manila Model: Exploring the Junction

of Social Entrepreneurship and the

Supporting Ecosystem
A Study of New Generation Social Enterprises in the Philippines

MASTER THESIS WITHIN: Business Administration

NUMBER OF CREDITS: 30 hp
PROGRAMME OF STUDY: Strategic Entrepreneurship
AUTHORS: Axel Lundberg & Jonathan Lennström Nyström
JÖNKÖPING May 2018
Master Thesis in Business Administration
Title: The Manila Model: Exploring the Junction of Social Entrepreneurship
and the Supportive Ecosystem
Authors: A, Lundberg & J, Lennström Nyström
Supervisor: Annika Hall
Date: 2018-05-21

Key terms: social entrepreneurship, social enterprises, entrepreneurial ecosystems,

developing countries

Background: Social entrepreneurship has lately gained wide recognition as a promising

avenue to develop market-driven solutions to improve lives of the
marginalised. While identified as an emerging topic in academics, literature
is still limited and heavily biased towards the context of western countries.
Further, little is known about how social enterprises interact with the
supportive ecosystem to develop their organisations and ensure financial
viability while attending their social mission. Thus, the Philippines was
chosen as the location of the study, a developing country plagued by social
problems, but simultaneously harbouring a growing ecosystem that support
social enterprises in their quest to address them.
Purpose: The purpose of this study is to explore how the development of New
Generation Social Enterprises (NewGen SE) is enabled by the surrounding
ecosystem in the context of the Philippines. It further aims to identify factors
constraining the progress of NewGen SE, and how the ecosystem can be
enhanced to better support these enterprises.
Method: The data for this qualitative study has been collected using in-depth, semi-
structured interviews. In total, twenty interviews were conducted: ten
entrepreneurs from three different development stages (start-up, growth &
mature), and ten ecosystem actors. The data has been analysed and
interpreted using a general inductive approach.
Conclusion: The networks of both the entrepreneurs and the ecosystem actors enable
social enterprises to access resources, expertise, and foster collaboration.
Challenges on both the macro and micro level are hindering social
enterprises to grow, resulting in only a few success stories. To enhance the
support for social enterprises more collaboration within and outside the
ecosystem should be fostered through the implementation of more
intersections such as physical and online spaces where people can connect.

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Acknowledgements
Submerging ourselves into the realm of social entrepreneurship has been a research journey we
will cherish until the end of our days. Our quest for knowledge has taken us down a windy
pathway rich in obstacles and challenges, but even more abundant in delight and enlightenment.
Therefore, we would like to fill this page with words of outmost gratefulness, appreciation and
sincerity to those who have helped us along the way.

First and foremost, we would like to express our deepest gratitude to SIDA, the Swedish
International Development Cooperation Agency, who through their generous MFS scholarship
made our field study in the Philippines possible. We also want to thank Jönköping University
and its helpful staff for facilitating and approving our application.

Next, we want to show our profound appreciation to ISEA, the Institute of Social
Entrepreneurship in Asia, and especially to Dr. Lisa Dacanay, who gracefully accepted our
request to host us in Manila. We also want to acknowledge the help from Ana Tan at ACSENT,
Ateneo Center of Social Entrepreneurship. The expertise and network provided from both
organisations were invaluable to us.

We also want to reach out to our eminent supervisor, Annika Hall, who went above and beyond
her responsibilities to assist us through the jungle of literature reviews, research paradigms,
and analysis writing. The quick response rate, constructive feedback and relentless positivity
made a big difference to us.

Further, we feel immensely thankful to the 20 inspiring people who gave up their precious time
to be interviewed for the purpose of this research project. In addition to their contribution to
this study, we personally received invaluable insights about social entrepreneurship that we
will carry with us in our future careers and lives.

Also, we feel deeply humbled by the “Humans of Manila” who showed unparalleled hospitality
during our two-month stay. Salamat Po!

Lastly, I, Axel, would like to express the honor and privilege I have felt to share this experience
with my companion Jonathan. Also, I, Jonathan, would like to express a genuine thank you to
my research partner Axel, whom I was lucky enough to share this experience with.

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Table of Contents
1 INTRODUCTION .................................................................................. 1
1.1 Background ......................................................................................................................... 1
1.2 The Context of the Philippines ......................................................................................... 2
1.2.1 Current Environment of Social Enterprises in the Philippines........................................................3
1.2.2 Identified Challenges and Opportunities ............................................................................................4
1.3 Problem statement ............................................................................................................ 4
1.4 Purpose ............................................................................................................................... 5
1.5 Perspective ......................................................................................................................... 5
2 LITERATURE REVIEW ......................................................................... 6
2.1 Social Entrepreneurship .................................................................................................... 6
2.2 Social Entrepreneurship in Developing Countries .......................................................... 8
2.2.1 Institutional Voids ...................................................................................................................................9
2.2.2 Hybridity................................................................................................................................................ 10
2.2.3 Social Capital and Local Embeddedness........................................................................................... 11
2.2.4 External Support Environment .......................................................................................................... 13
2.3 Entrepreneurial Ecosystem ............................................................................................. 14
2.3.1 Social Entrepreneurial Ecosystem ..................................................................................................... 15
2.4 Social Entrepreneurship Research in the Philippines ................................................... 18
2.4.1 The Support Environment in the Philippines .................................................................................. 19
2.4.2 Policy Environment .............................................................................................................................. 20
2.5 Summary Literature Review ........................................................................................... 21
3 METHODOLOGY / EMPIRICAL RESEARCH .................................. 23
3.1 Research Philosophy ........................................................................................................ 23
3.2 Research Design ............................................................................................................... 24
3.2.1 Research Approach ............................................................................................................................. 25
3.4 Literature Review............................................................................................................. 25
3.5 Primary Data Collection ................................................................................................. 26
3.5.1 Qualitative Interviews ......................................................................................................................... 27
3.5.2 Observations ........................................................................................................................................ 32
3.5 Data Analysis .................................................................................................................... 33
3.6 Ethics ................................................................................................................................. 35
3.6.1 Broader Ethical Concerns for Society.............................................................................................. 36
3.7 Research Quality .............................................................................................................. 36
4 EMPIRICAL FINDINGS ....................................................................... 38
4.1 Identified Categories........................................................................................................ 38
4.2 Enabling Factors ............................................................................................................... 38
4.2.1 Entrepreneurs ...................................................................................................................................... 39
4.2.2 Ecosystem Actors ................................................................................................................................ 42
4.2.3 Summary of Enabling Factors ............................................................................................................. 44
4.3 Challenges ......................................................................................................................... 44
4.3.1 Entrepreneurs ...................................................................................................................................... 44
4.3.2 Ecosystem Actors ................................................................................................................................ 47
4.3.3 Summary of Challenges....................................................................................................................... 48
4.4 Opportunities/Overcoming Challenges ......................................................................... 49
4.4.1 Entrepreneurs ...................................................................................................................................... 49

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 4.4.2 Ecosystem Actors ................................................................................................................................ 51
4.4.3 Summary................................................................................................................................................ 53
4.5 Additional Contextual Influences ................................................................................... 54
4.5.1 Government ......................................................................................................................................... 54
4.5.2 Collaboration........................................................................................................................................ 56
4.5.3 Culture .................................................................................................................................................. 56
4.5.4 Summary of Contextual Influences ................................................................................................... 58
4.6 Summary Findings ........................................................................................................... 58
5 ANALYSIS............................................................................................. 59
5.1 Enabling factors ................................................................................................................ 59
5.1.1 Intersections as a gateway .................................................................................................................. 60
5.1.2 Network as a facilitator ...................................................................................................................... 61
5.2 Growth Vacuum ............................................................................................................... 63
5.2.1 Resource and Expertise as Constraints ........................................................................................... 63
5.2.2 Government and Cultural Constraints ............................................................................................ 64
5.3 Opportunities ................................................................................................................... 65
5.3.1 Collaboration........................................................................................................................................ 66
5.3.2 How to Foster Collaboration through Intersections .................................................................... 67

6 DISCUSSION........................................................................................ 69
6.1 The Growth Challenge .................................................................................................... 69
6.2 Managing Multiple Partnerships ..................................................................................... 70
6.3 Diversifying the Ecosystem ............................................................................................. 70
7 CONCLUSIONS & IMPLICATIONS ................................................. 72
7.1 Practical and Theoretical Contributions ....................................................................... 73
7.2 Limitations and Future Research ................................................................................... 74
LIST OF REFERENCES .......................................................................... 76
APPENDICES .......................................................................................... 83

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List of Figures, Tables and Abbreviations
List of Figures

Figure 1. Entrepreneurial ecosystem............................................................................................... 14

Figure 2. Ecosystem actors in the Philippines ................................................................................ 20
Figure 3. A general inductive approach to analysing qualitative data ......................................... 34
Figure 4. Process of analysing the data ........................................................................................... 35
Figure 5. A relational model of ecosystem influences on social enterprises ............................ 60
Figure 6. The Manila Model: the reciprocal micro and macro ecosystem ................................ 66

List of Tables

Table 1. Summary literature review ................................................................................................ 21

Table 2. Interview summary ............................................................................................................. 28
Table 3. Overview entrepreneurs ................................................................................................... 30
Table 4. Overview ecosystem actors .............................................................................................. 31
Table 5. Overview of observations ................................................................................................. 32
Table 6. Identified categories ........................................................................................................... 38
Table 7. Summary findings ................................................................................................................ 58

List of Appendices

Appendix 1 – Challenges................................................................................................................... 83
Appendix 2 – Ecosystem Actors ..................................................................................................... 84
Appendix 3 – PRESENT Bill .............................................................................................................. 86
Appendix 4 – Topic Guide Entrepreneurs ..................................................................................... 88
Appendix 5 – Topic Guide Ecosystem Actors .............................................................................. 89
Appendix 6 – 2nd Level Codes ........................................................................................................ 90
Appendix 7 – Informed Consent ..................................................................................................... 91
Appendix 8 – Proposal Letter .......................................................................................................... 92

Abbreviations

NewGen SE New generation social enterprises

SEPPS Social enterprises with poor as primary stakeholder

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1 Introduction
Ten years after the financial crisis the global economy is in a buoyant mood; displaying
evidence of robust, resilient and continuous growth. Nonetheless, widespread inequality and
poverty are still stark realities in countless of places around the world. According to the United
Nations (2015), nearly 800 million people live below the poverty line, whereas income and
wealth are more unequally distributed than ever (World Inequality Report, 2018).
Consequently, "Ending poverty" and "Reduce inequality" are two of the sustainable
development goals, also known as Agenda 2030, set up by the United Nations to address these
pressing issues (United Nations, 2015).

By nature, such monumental challenges are often complex and multifaceted and need to be
approached in various ways, involving many actors. As expressed by Muhammad Yunus,
Nobel laureate and Grameen Bank founder, “Aid alone cannot be our response. Global
sustainability and the nature of the economy will be shaped by entrepreneurship and the terms
on which we create and do business with each other” (Think Global Trade Social Report, 2015:
2). This quote directly refers to the concept of social entrepreneurship, which has lately gained
wide recognition as a promising and effective avenue to develop sustainable solutions to
improve lives of the poor and marginalised (Think Global Trade Social Report, 2015).

Particularly in developing countries, often suffering from weak governments and limited
welfare systems, social enterprises can play significant roles where state and other institutions
have failed to make a substantial difference. One such nation is the Philippines, seemingly
encapsulating both the economic challenges and the simultaneous opportunities for social
entrepreneurship – hence making it an intriguing setting for this study. While showcasing
strong economic growth, the country is ceaselessly plagued by social challenges such as,
widespread poverty and huge inequalities (World Economic Forum, 2018; World Bank, 2017).
Social enterprises are rising to the challenge of solving these problems. However, as
emphasised in an OECD report (2015), their success is arguably hinged on the presence of a
significant support system, also known as an entrepreneurial ecosystem, that among other
actors include financers, networks, enablers as well as appropriate policies and regulations that
encourage social enterprises to scale and make significant impacts.

1.1 Background
In today's society, the private sector mostly consists of for-profit ventures with a purpose of
maximising shareholder value. However, in the past decades, the same private sector has
experienced a rise of organisations with an embedded social goal (Austin, Stevenson & Wei-
Skillern, 2006; Dees, 2007). Entrepreneurial activities with a primary focus that is social rather
than financial can be classified as concepts of "social entrepreneurship" or “social enterprises”
(Austin et al. 2006). These two terms will be used interchangeably throughout the thesis since
the entities carrying out social entrepreneurial activities are generally classified as social
enterprises. This new global phenomenon has challenged the status quo of how social problems
are addressed and financed by governments, non-profits, and businesses. A prominent example

1
is the Grameen Bank started by Muhammad Yunus in 1983, a microcredit institution offering
small loans and other financial services to the impoverished previously excluded from the
financial markets (Yunus, Moingeon & Lehman-Ortega, 2010). By providing microloans and
business education, many people were able to set up micro-entrepreneurial ventures, and in
that way work themselves out of poverty, while contributing to the local economy through
taxation and job creation. Driven by the fact that these social entrepreneurs have proven to be
robust social transformers in our society, research has started to dedicate significant attention
to the phenomenon of social entrepreneurship and social enterprises (Peredo & McLean, 2006;
Short, Lumpkin & Moss 2009).

From the perspective of a developing country, social enterprises operate under different
circumstances in comparison to the ones in a developed country. Many of these emerging
markets, like the Philippines, suffer from insufficient governance and social unjust regarding
poverty, inequality and financial exclusion (Kolk & Lenfant, 2015). Therefore, the purpose of
many social enterprises is to contribute to the alleviation of poverty and inequality (Seelos,
Ganly & Mair, 2006; Dacanay, 2012). To address the issue of poverty and inequality, the social
enterprise movement in the Philippines has gained support, and is today among the leading
countries in Asia when it comes to promoting social entrepreneurship and social enterprises
(Ballesteros & Llanto, 2017).

Despite the increased interest in the field, knowledge of the broader socio-economic, cultural,
and political factors that influence what type of social enterprises that will emerge in a
particular context remains infantile (Hazenberg, Bajwa-Patel, Mazzei, Roy & Baglioni, 2016).
As explained by Hazenberg et al. (2016), the types of enterprises that emerge differ depending
on the institutional context present in a given country. As a result, in each “ecosystem”,
institutional and stakeholder networks influence social enterprises differently. Due to political
and economic struggles in developing economies like the Philippines, the local ecosystem is
likely to influence social enterprises differently in comparison to ecosystems in developed
nations.

1.2 The Context of the Philippines

The Philippines is an archipelago made up of over 7,000 islands with a tropical climate and
great access to natural resources. Despite its notion as a paradise, it frequently experiences
natural catastrophes such as typhoons, earthquakes and volcano eruption, having caused
widespread destruction in recent history. The Philippines today has a population of around 104
million people (BBC, 2018). During the last 300 years the country has been colonised by both
Spain and America until became independent after the World War II in 1945. The Spanish and
the US influences remain strong until today, especially in terms of religion and language where
the majority of people are Christian, and English is their second language. Their current
president is Rodrigo Duterte who took the presidency in June 2016.

The Philippines is one of East Asia´s top growing economies. According to the World Bank
(2017), the GDP has since 2012 grown at an average rate of 6,5%, and is estimated to grow at

2
by 6,9% in 2018. Despite recent growth, the World Bank estimated in 2015 that around 22%
of the population was living in poverty. To tackle this problem, the country is aiming for
inclusive growth to increase household consumption as well as reducing poverty in the country.
According to the government's sustainable development plan 2017-2022 (2017), the goal is to
reduce poverty to around 14% by 2022 - equivalent to about 6 million people that would be
lifted out of poverty. Furthermore, in the same development plan, the government has also
acknowledged that social enterprise business models should be more promoted as a tool to fight
poverty and inequality in the country. However, even though the aspirations are high for an
inclusive growth, there is still a significant wealth gap in the country. In 2016 it was reported
that the 50 wealthiest Filipinos (Chung, 2017) accounted for 24,4% of the nation's entire GDP,
and they together have a cumulative value of US$73.9 billion (Dela Paz & Schnabel, 2017).
According to the same article, the same people are also expected to grow richer under the
presidency of Rodrigo Duterte, indicating that the wealth gap will remain high in the country.
Thus, social enterprises can play a pivotal role in promoting more inclusive growth in the
country.

1.2.1 Current Environment of Social Enterprises in the Philippines

In the report "Reaching the Farthest First", hereafter referred to as “RFF Report, 2017”,
published in collaboration between the European Union, British Council, United Nations
ESCAP, CSO-SEED and Philippine Social Enterprise Network (PhilSEN) it was estimated that
the total amount of operating social enterprises in the country today is over 164,000. The
previous number reported was 30,000 back in 2007. Even though these measurements are just
an estimation, it indicates that it is a fast-growing scene. However, as outlined in the next
section, it is worth to mention that social enterprises in the Philippines take many shapes and
forms and the study only provides an overview of the sector as a whole and do not differentiate
between the different types.

In a study conducted by the Institute for Social Entrepreneurship in Asia (ISEA) and Oxfam in
2015, they identified five different forms of social enterprises, namely: social cooperatives,
microfinance institutions (MFIs), fair trade organisations (FTOs), trading development
organisations (TRADOs) and finally, new generation social enterprises (NewGen SE). Social
cooperatives are organisations that are composed of the poor while also serving them. MFIs
are corporations or NGOs offering financial services such as insurances and microcredits to the
poor. FTOs are enterprises guided by fair trade principles that through partnerships aim to
provide access to markets and improve conditions for poor producers. TRADOs are non-
government development organisations (NGDOs) engaged in economic activities such as
trading and marketing of goods, or provision of development services. Lastly, NewGen SE are
enterprises commonly initiated and led by the youth. What characterises this type of social
enterprises is their goal to design scalable solutions aimed at alleviating poverty. Further, in
contrast to some of the previously mentioned forms, NewGen SE tend to come from business-
related backgrounds and thus emphasise commercialisation faster (Ballesteros & Llanto, 2017).
Currently, this is one of the fastest growing segments of social enterprises in the Philippines,
yet literature on these is limited (ISEA & Oxfam, 2015; Ballesteros & Llanto, 2017). Their

3
potential to scale and create widespread impact make them highly interesting, both from a
practical and theoretical viewpoint. Therefore, for this study, we have chosen to focus on
NewGen SE.

Not only the amount of social enterprises has increased significantly in the Philippines during
the past decades, but also the number of actors from different support segments, which further
contributes to the development of the sector (Ballesteros & Lianto, 2017). These actors are
considered to make up a majority of the physical elements of the existing ecosystem and play
different roles in supporting and influencing social ventures at the various stages of their life
cycles.

1.2.2 Identified Challenges and Opportunities

As manifested in the RFF Report (2017), there exists a sense of progress and optimism about
the social entrepreneurship sector in the Philippines. However, it is also evident that social
enterprises face substantial barriers to growth. Looking at the statistics of the RFF Report
(2017), it can be concluded that there are three major challenges currently preventing social
enterprises to reach their full potential (Appendix 1). The number one challenge is the limited
supply of capital, which appear to stem from several underlying issues such as unrefined
business plans and a lack of professional contacts, ultimately hindering access to finance. The
second challenge relates to human resources, as accessing, attracting and retaining skills and
talent, both technical and managerial, are reported as factors preventing social enterprises to
grow. Thirdly, the government and the policy environment put up hurdles for social enterprises
in the form of policies, taxation, red tape and regulation compliance.

As highlighted in the RFF report (2017), there is a pressing need for the government to formally
recognise social enterprises and their business activities that so actively contribute to economic
inclusion and social cohesion in the country. This is in line with the view of Poon (2011), who
argues that the political and legal environment play a crucial role in providing opportunities
and support for social enterprises. However, as the RFF Report (2017) concludes, also the
private sector has a vital role to play in supporting and facilitating the integration of social
enterprises into the market. Poon (2011) argues that social entrepreneurs require a range of
supporting institutions to conceptualise ideas, provide resources and execute business plans
into eventual success. These different institutions, together with government and individuals,
make up the ecosystem in the Philippines. As acknowledged by Poon (2011), the ecosystem
has potential to assist social enterprises in overcoming identified challenges in the form of
financing, expertise and networking opportunities. Despite its promising existence in the
Philippines, there appears to be a gap between the potential of the ecosystem and the current
effectiveness of the social enterprise sector.

1.3 Problem statement

The continuous global problems of exclusive development, poverty, and inequality indicate
that there will be demand and necessity for social enterprises to operate in the marketplace as
creators of both financial and social wealth (Doherty, 2014). As suggested by Dacanay (2012),

4
social enterprises in developing countries have the potential to act as catalysts together with
state and market actors to provide sustainable, positive change. However, scrutinising the
literature shows a geographical bias towards the West (Doherty, 2014). As a result, there is
limited knowledge how different institutional frameworks and contexts influence the
development of social enterprises. Therefore, the same author strongly suggests additional
research in Africa and Asia because of the high potential of social enterprises in those regions.
The RFF Report (2017) referred to in the background, and later in the literature review, does
provide an initial, comprehensive understanding and mapping of the ecosystem supporting
social enterprises in the Philippines, while also concluding that the sector is both promising
and challenged. With a significant portion of the recent upsurge attributed to the increasing
number of NewGen SE, the research on this particular type of social enterprise is still in its
infancy. Moreover, the report is merely an overview and does not offer an in-depth analysis of
the interaction between social entrepreneurs and actors within the ecosystem. The factors of
the ecosystem that influence development and scalability of NewGen SE are yet unexplored.

1.4 Purpose
The purpose of this study is to explore how the development of New Generation Social
Enterprises (NewGen SE) is enabled by the surrounding ecosystem in the context of the
Philippines. It further aims to identify factors constraining the progress of NewGen SE, and
how the ecosystem can be enhanced to better support these enterprises.

To clarify the terminology in the purpose of our research, development refers to a number of
different aspects. Firstly, it refers to the birth and initiation phase of an enterprise. Secondly, it
refers to the growth and scale of the enterprise in terms of tangible measures such as revenue
and number of customers. Lastly, it refers to the expansion of intangible measures such as
knowledge. Based on our purpose, we aim with this study to answer the following three
research questions:

1. How does the ecosystem enable NewGen SE to develop?

2. What are the constraining factors hindering NewGen SE to develop?

3. How can the ecosystem be improved in order to assist NewGen SE to overcome

challenges and better support the development of NewGen SE?

1.5 Perspective
Considering the purpose of our study, we have chosen to take a double-sided perspective of
both the social entrepreneurs and the various supportive players in the ecosystem. We believe
that the social entrepreneurship scene exists and develops in symbiosis with all actors, and
therefore deem that both viewpoints are equally important and relevant.

5
2 Literature Review
This chapter aims to provide a comprehensive theory-based research framework to deepen the
understanding of the topics related to our purpose. To set the scene, we first dive deep into the
phenomena of social entrepreneurship by critically analysing some of the most influential work
in the research field. Secondly, we introduce the social entrepreneurship concept in the context
of developing countries. Thirdly, we introduce the concept of entrepreneurial ecosystems
before critically analysing it in relation to social entrepreneurship. Finally, the current state
of social entrepreneurship literature in the context of Philippines is presented. Here, we
decided not only to limit ourselves to theoretical work as we found substantially important
work outside the scope of academic literature.

2.1 Social Entrepreneurship

The concept of Social Entrepreneurship is said to have its roots in the early 1990s when Bill
Drayton popularised the idea after establishing the social entrepreneurship organisations
ASHOKA (Light, 2006). Despite its growth during the same decade, it did not become a
scholarly phenomenon until the late 1990s. Since then, many notable scholars have adopted a
keen interest in the field (Short, Moss & Lumpkin 2009). Nonetheless, the research field of
social entrepreneurship is still a novel and underexplored area. Although the volume of research
produced has increased significantly, much of the published literature has been conceptual
work trying to define the concept (Short et al. 2006). As a result, different opinions from
different scholars have emerged, and the establishment of a unified definition of social
entrepreneurship is still lacking (Mair & Martí, 2006; Short et al. 2009; Dacin, Dacin & Matear,
2010). Even though opinions on how to define the phenomenon are widespread, there seems
to be an agreement that social entrepreneurship differs enough from commercial
entrepreneurship regarding motivation and mission to deserve its deserves its existence in the
literature (Austin et al. 2006, Weerwandena & Mort, 2006; Santos, 2012).

In contrast to traditional entrepreneurship, many scholars argue that it is the motivation and
commitment to provide social over economic value that makes social entrepreneurship unique
(Dees, 1998; Mair & Marti 2006; Peredo & McLean, 2006; Zahra et al., 2009). For example,
Peredo and Mclean (2006) argue that social entrepreneurship is different because it involves
sacrificing profits to achieve a social mission. Further, economic value creation should only
work as a by-product (Mair & Marti, 2006) to ensure that a venture can sustain its social
mission (Dees, 1998; Dacin, Dacin & Tracey, 2011). Weerawardena and Mort (2006) argue
that because of its mission, social enterprises face different types of obstacles in contrast to the
ones faced by commercial enterprises. Additionally, Austin, Stevenson and Wei-Skillern
(2006) highlight that opportunities exist for both social and commercial entrepreneurship, but
due to the large volume of social problems in society the opportunities for social
entrepreneurship are much greater than the capacity of social ventures. Further, social
entrepreneurship also lacks an infrastructure for access to capital, especially during the
development stages (Sharir & Lerner, 2006). Despite these differences, some researchers
believe that there is no need to distinguish social entrepreneurship from conventional
entrepreneurship (Chell, 2007; Dacin et al. 2010). For instance, Chell (2007) argues that both

6
social and commercial entrepreneurs recognise and pursue opportunities regardless of the
resources available to them. Similarly, Dacin et al. (2010) state that social entrepreneurship is
indistinguishable from commercial entrepreneurship as it also involves profit making by
innovatively pursuing a mission.

After reviewing some of the most cited articles on the topic, it is easy to confirm the lack of a
unified definition. In an attempt to review the literature Dacin et al. (2010) identified over 40
different articles trying to define the concept. They suggest that definitions holding the most
promise focus on either the mission of the social enterprise or the processes and resources
utilised.

As mentioned in the beginning, many scholars have defined social entrepreneurship based on
its primary mission to provide social value (Dees, 1998; Mair & Marti 2006; Peredo & McLean,
2006; Zahra et al., 2009). Dees (1998) states that it is the mission of the enterprise that
determines whether it is a philanthropic activity or a commercial business. Thus, in the pursuit
of a social mission, some authors have disregarded the economic activity in their definitions
(Weerawardena & Mort, 2006), whereas some authors include it although it is not the primary
mission (Mair & Marti 2006; Zahra, 2009). For instance, Zahra et al. (2009) state that social
entrepreneurship "encompasses the activities and processes undertaken to discover, define, and
exploit opportunities to enhance social wealth by creating new ventures or innovatively
managing existing organisations" (Zahra et al., 2009: 522). This definition embraces the fact
that enterprises have distinctive ways of attending to social problems whilst ensuring the
creation of both social and financial wealth. Santos (2012) challenges the mainstream view that
social entrepreneurship should address social problems by pursuing a social mission. He argues
that a “rigorous definition of social entrepreneurship should avoid using the word social”
(Santos, 2012: 336). Instead of addressing so-called ‘social problems’, social entrepreneurship
should focus on addressing neglected problems that the market and government have failed to
address. He defines social entrepreneurship as “addressing neglected problems with positive
externalities” (Santos, 2012: 337). Externalities refer to the spillover effect that is created
because of economic activity (Rangan et al., 2006). Instead of creating products or services
that may have negative externalities such as over-consumption or increased wealth gap, a social
enterprise ensures positive externalities (Santos, 2012). Although social enterprises can play a
crucial role in a country's economic development while solving neglected problems, these
enterprises are much more likely to face challenges when acquiring resources needed for
growth (Santos, 2010).

The processes utilised by entrepreneurs are interlinked with the organisation’s capability to
manage resources to address a specific social problem (Dees, 1998; Mair & Mair, 2006; Peredo
& McLean, 2006; Chell, 2006; Sharir & Lerner, 2006; Dacin et al., 2010). Due to the difficulty
of acquiring right resources, some authors describe social entrepreneurship as the ability to take
action without being limited to resources currently at hand (Dees, 1998; Sharir & Lerner, 2006).
Further, Mair and Marti (2006) state that it involves the innovative use and combination of
resources. The process of social entrepreneurship involves the distinction of whether social

7
entrepreneurship should focus on economic value creation or social value creation (Mair &
Marti, 2012). Some authors place social entrepreneurship as social mission driven
organisations within the non-profit sector, purely focusing on solving a problem
(Weerawardena & Mort, 2006). Other authors do not distinguish the “mission” of creating
social value over different sectors. Instead, it can occur across government, business or the non-
profit sector (Austin et al., 2006; Dacin et al., 2011). Moreover, Zahra et al. (2009) argue that
social enterprises aim to create ‘total wealth’, which is the sum of social and economic wealth
created, where the social wealth is the dominator. Similarly, Santos (2012) highlights that
social enterprises engage in both activities but emphasise value-creation (mission) over value-
capturing (economic return). Even though many authors agree that defining the concept based
on its primary mission accompanied by the processes and resources utilised is promising, few
authors outline the contextual factors that influence social entrepreneurship.

Similar to commercial entrepreneurship contextual factors will affect the nature and outcome
of any social initiative. These contextual factors may include the macro economy, regulatory
framework including taxes and the socio-political environment. Austin et al. (2006) argue that
if social enterprises are more aware of the contextual factors they are much more likely to have
a successful outcome. Depending on the geographic location, contextual factors are likely to
affect social enterprises in different ways. For instance, Dacin et al. (2010) stated that contexts
with strong institutional resources, which include political and legal aspects, could enhance the
organisational development. However, these contexts are present in developed countries where
social problems are minimal in comparison to many developing countries where social
problems are at large (Mair & Marti, 2009). After reviewing the social entrepreneurship
phenomenon, it is evident that a majority of the most influential articles published on the topic
look at the concept in the context of developed countries. Thus, there is a geographical bias in
the current state of the literature (Doherty et al., 2014).

2.2 Social Entrepreneurship in Developing Countries

Noting the importance of context when reviewing the phenomenon of social entrepreneurship,
we chose to narrow the search by focusing social entrepreneurship in a “developing country”.
32 articles were deemed relevant. Clearly, this is still a very broad context, as developing
countries can possess vastly different characteristics. However, we concluded social enterprises
would address somewhat similar problems in such settings, regardless of geographical location.
We observed that a majority of those studies that explicitly state where the study was performed
come from India, Bangladesh as well as various African countries.

Many scholars argue that one of the major reasons why the definitional debate lingers within
social entrepreneurship research is because the concept is inherently dependent on contextual
factors (Chen, Saarenketo, Puumalainen, 2016; Sengupta & Sahay, 2017; Zhao & Lounsbury,
2016). In their literature review, Sengupta and Sahay (2017) call for more qualitative research
on how different contextual factors influence social enterprises from achieving their financial
goals and social missions. In one qualitative study conducted in Egypt, Ghalwash, Tolba and
Ismail (2017) emphasise the importance of understanding the socio-cultural and economic

8
context to fully grasp the phenomenon of social entrepreneurship. Similarly, in a quantitative
study by Zhao and Lounsbury (2016), an institutional logic approach is used to highlight the
influences of economic and cultural forces that the social venture is locally embedded in. It has
further been noted that social enterprises are perceived to address different issues depending
on the context. In a comparative study between India and Australia, it was observed that social
enterprises in a developing country focused primarily on raising living standards for the poor
at the bottom of the pyramid. In contrast, in a developed country setting, social enterprises
address matters such as the environment and healthy eating (Haski-Leventhal & Mehra, 2016).

To further examine social entrepreneurship in a developing country context, we note that the
literature broadly looks at this phenomenon through four different lenses; namely institutional
voids, hybridity, social capital and local embeddedness, and the support environment.

2.2.1 Institutional Voids

A significant difference compared to developed countries is the level of institutional support,
which is argued to influence the development of social enterprises (Ault, 2016). It has been
identified numerous times in the literature that developing countries are frequently
characterised by so called ´institutional voids´, where market institutions are either absent,
weak or fail to accomplish their role (Roy & Karna, 2015; Ghalwash et al., 2017; Mair & Marti,
2009;). Perhaps most relevant from an entrepreneurial perspective are formal and informal
commercial institutions that support business activity. Those include, but are not limited to
capital markets, banking regulations, legal systems, educational systems, and labour markets
(Dutt, Hawn, Vidal, Chatterji, Mcgahan, & Mitchell, 2016). Institutional voids are said to
hamper market access, development and functioning, resulting in operating challenges for
entrepreneurial actors (Mair & Marti, 2009; Chen et al., 2016). As identified by Dutt et al.
(2016), when gaps are left by commercial institutions, problems related to regulation
compliance, financing and corruption take hold – ultimately protecting established, often
politically connected, companies. Additionally, it can also negatively influence behavioural
patterns and hinder progress on a larger scale, as “dysfunctional institutions imprison societies
in webs of self-fulfilling expectations that not only create but also reinforce the cycles of
poverty” (Khavul & Bruton, 2012: 288).

However, it has also been noted that institutional voids can in fact promote and encourage
social entrepreneurship. In such an environment, characterised by inefficient governments and
the absence of influential NGOs, the result is unsatisfied social needs and hence, the emergence
of more social entrepreneurial opportunities (Chen et al., 2016). Put differently, Diochon and
Ghore (2016) agree that perceived barriers do not necessarily have to be a constraining factor,
but can rather stimulate social entrepreneurs to act on an opportunity. Consequentially,
entrepreneurial ventures are more likely to be socially oriented in developing countries due to
failures from state and market to address such issues (Chen et al., 2016). Through innovation,
social entrepreneurship presents a viable method to reduce institutional inefficiencies and
develop new capabilities (Rao-Nicholson, Vorley & Khan, 2017). Because of their prosocial
motivation, social entrepreneurs act where others would not, to introduce solutions that remove

9
barriers and hence facilitate access to markets for others (McMullen & Bergman, 2017). To
summarise, it appears that the negative effects on social entrepreneurship activity, due to
dysfunctional or absent institutions, coexist with the positive effect on social entrepreneurship
activity such an environment brings (Chen et al., 2016).

Much of the literature seems to agree that social entrepreneurship has the potential to bridge
the gaps left by inefficient markets and institutions. While acknowledging this, Hacket (2016)
warns that one must also appreciate the limitations to alter deeply entrenched political and
economic realities that characterise developing countries. This was concluded after a study on
a well-established social enterprise, Grameen Shakti in Bangladesh, which further highlights
the difficulties. Zhao and Lounsbury (2016) dwell even further into the challenges involved.
While recognising the need to develop a strong market logic, with free market solutions to
create a favourable business climate and encourage capital flows, they proceed to stating that
fertile markets for social enterprises are not just determined by political and economic policy,
but also elements such as culture and religion. They claim that markets are social institutions
in themselves, are intertwined with other social institutions, and need to be understood on a
fundamental level.

This inevitably leads to the question posed by Mair and Marti (2009): How do entrepreneurial
actors overcome such institutional challenges and impairments for market access and
participation? Roy and Karna (2015) also recognise this challenge and propose that social
entrepreneurs need to leverage the institutional environment as well as resources to enhance
effectiveness of the business model and increase their impact on society. Correspondingly,
Mair and Marti (2009), in an attempt to answer their own question, noted that entrepreneurs
apply strategies of bricolage to create something out of what is at hand, while refusing to accept
the current situation as unchangeable. Further, the subsequent sections below discusses other
ways for social enterprises to deal with contextual as well as other challenges.

2.2.2 Hybridity
To successfully scale their social mission and, simultaneously, reach financial sustainability,
social enterprises must adapt their structure, processes and business models in both areas
(Battilana & Lee, 2014). Consequently, they often apply a multiple stakeholder structure in
which they navigate through different contexts and take on different organisational forms and
identities (Easter & Dato-On, 2015). The multitude of coexisting objectives and institutional
logics are said to be characteristics of a hybrid organisation (Pache & Santos 2013; Huybrechts,
Nicholls, & Edinger, 2017). Thus, it has been suggested that social enterprises are naturally
associated with issues of hybridity given their mix of organisational objectives and activities
that traditionally either belong in a business setting or the world of non-profits (Battilana &
Lee, 2014; Holt & Littlewood, 2015). It has further been suggested that ‘hybrid organisation’
is a broader term than ‘social enterprise’, as it embraces a wider heterogenic spectra of various
legal forms, missions, contexts and business models (Holt & Littlewood, 2015). ‘Social
franchising’ is one example of such a business model appearing in the literature (Bradley et al,
2012; McKague, Wong & Siddiquee, 2017). In a case study from Bangladesh, the franchisor

10
provided market coordination and support systems to small enterprises in rural areas, which
allowed them to widen their social impact while simultaneously, build entrepreneurial capacity
in previously neglected areas (McKague et al., 2017).

It appears in the literature that hybridity is particularly well suited, and often essential, in a
developing country context. A case study in sub-Saharan Africa found hybridity that was
deployed to deal with the complexity of multi-sector partnerships. Building relationships with
various partners were needed to overcome the numerous gaps in resources, skills and
knowledge (Holt, & Littlewood, 2015). In another study by Kistruck, Beamish, Qureshi and
Stutter (2017), focusing on fair trade oriented social enterprises; the authors investigated their
willingness to cooperate with commercial actors. Some, labelled as “sector solidarity”,
exclusively chose to deal with likeminded, socially focused organisations. On the contrary,
those labelled as “active appropriation”, embraced hybridity and were open to also build
relationships with purely commercial actors. Although unethical practices occurred within
those mainstream businesses, the advantages were judged to outweigh the negative aspects as
awareness and visibility of fair trade grew, as well as sales - which ultimately benefited their
producers and contributed to their social mission. However, a potential risk with this approach
is the so-called “mission drift”, where social enterprises over time lose focus of their social
mission in exchange for a more profit-driven business model (Ault, 2016). The same author
claims that this is more likely to happen in for-profit social enterprises. Also, the relatively
higher cost of serving the poor in nations with weaker institutions make mission drift more
likely to happen in developing countries (Ault, 2016).

One type of partnership social enterprises need to develop is the one with local communities.
Here, Manning et al. (2017) emphasise the importance of context and introduce a concept they
call ‘community based hybrids”, where organisations rely on resources from local communities
in which they are deeply embedded in. While benefiting those communities they also serve
clients locally, regionally and potentially internationally. However, the authors also highlight
the importance of community organisations, often filling the roles of intermediaries, to
facilitate the extraction of resources the hybrid firm needs. Navigating such a varied landscape
described in this section is challenging for the social enterprise, with risks of losing reputation,
legitimacy, and “license to operate” if doing it wrong (Holt & Littlewood, 2015). Much of the
literature concerning hybridity highlighted the importance of building relationships with a
variety of actors to fulfil its mission. As a way to accomplish this, the next section will proceed
to build on the aspects of social capital and local embeddedness.

2.2.3 Social Capital and Local Embeddedness

The concept of social capital has been described as the potential and actual benefits that can
derive from a person’s social connections (Maas, Seferiadis, Bunders, & Zweekhorst, 2014). It
can be accessed within the organisation but also through external links to other individuals,
organisations and communities – often referred to as bridging social capital (Easter & Dato-
On, 2015). It has been pointed out that in environments with scarce resources the importance
of social capital increases (Bhatt & Altinay, 2013; Maas et al., 2014). Building on that notion,

11
the same authors suggest that social entrepreneurs in a developing country context are
dependent on social capital to a higher degree than their developed country counterparts.
Khavul and Bruton (2012) provide an explanation stating that in environments where
institutions are absent or not providing enough support, the importance of the local network
increases as reciprocity among individuals provide a sense of safety and trust. For instance, in
a qualitative case study in India, it was observed that social capital was leveraged by social
entrepreneurs to mobilise resources and overcome limited access to finance (Bhatt & Altinay,
2013). Further, in a longitudinal case study in Bangladesh, necessary resources such as capital,
labour and ideas appeared to be readily available in the local environment, but networking was
a key ingredient to ultimately stimulate entrepreneurial activity. Thus, it is suggested that
entrepreneurial opportunities are not merely found, but rather embedded and created (Maas et
al., 2014).

We note that a significant portion of the literature tends to focus on a social enterprise’s ability
to build social capital with those who would potentially benefit from the social mission.
Communities in developing countries are often characterised as “tight-knitted” and are subject
to social norms, which determines daily life to a higher degree than in western countries
(McMullen & Bergman, 2017). Therefore, it is vital for the social enterprise to understand the
environment in which the target group is embedded in (Khavul & Bruton, 2012). Operational
models in such a setting need to “reflect, be adapted for, and address the opportunities created
by specific local environmental conditions” (Holt & Littlewood, 2015: 121). If local context
and local networks are ignored it becomes difficult for social entrepreneurs to make an impact
even if the initial intention was good (Khavul & Bruton, 2012). Expanding on this idea, it is
suggested that a more profound engagement of beneficiaries - those who benefit from the
activities of social enterprises - through stages of implementation, development, and scaling,
increases the chances of a successful social innovation (Bhat & Altanay, 2013). Similarly, it is
argued that social enterprises addressing poverty cannot only connect to individual consumers,
but also need to involve families and the surrounding communities to make a sustained impact
(Khavul & Bruton, 2012). To succeed as a social enterprise, Roy and Karna (2015) propose
that a previous, personal, affiliation to the underlying cause of the problem is crucial. Only by
doing this, awareness and expertise about the subtleties of culture and social dynamics can be
developed. Manning et al. (2017) agree by stating that origin does play a role, as locally grown
firms can more effectively use resources through their established community ties.

It appears most of the literature suggest a correlation exists between the level of success and
the level of local embeddedness of the social enterprise. However, in a case study conducted
in Vietnam by Easter and Dato-On (2015,) it was proposed a higher degree of local
embeddedness reduces the ability to effectively function and manage social ties in other
contexts to scale their social impact – simply because insufficient connections and expertise
had been developed outside the immediate boundaries. On a related note, Maas et al. (2014)
found that strong ties, from friends and family in the immediate context, had negative effect on

12
entrepreneurial activity in the beginning. On the contrary, so called weak, or bridging ties,
provide links to other actors which had a positive effect on the development of the business.
This leads us to the next section, which focuses on the influence of an external support system.

2.2.4 External Support Environment

In congruence with authors in previous section, Lan, Zhu, Ness, Xing and Schneider (2014)
observe that connections and support from internal stakeholders and cooperation with local
communities are vital to grow the social enterprise. However, equally important is the network
with external stakeholders that can provide support in terms of knowledge, financing, policy
advice and marketing. Maas et al. (2014) especially highlight its importance when facing
scepticism from the direct environment, as external actors can play an essential role in
providing support and building linking networks. Following that logic, it has been observed in
the literature that social entrepreneurs, just like conventional entrepreneurs, cannot act
singlehandedly in the pursuit of an opportunity (Diochon & Ghore, 2016; Rao-Nicholson et al.,
2017). It is further pointed out that social entrepreneurship is not a linear process but one that
requires detours, adaptation and support from various actors (Diochon & Ghore, 2016). Kolk
and Lenfant (2015) also emphasise the need to look beyond one’s immediate environment.
They identify cross sector collaboration as a way to overcome challenges such as the lack of
governance and trust, which is often lacking in weak states. These partnerships can help set
“the rules of the game”, promote respect for contractual agreements, facilitate relationship
building and create a culture of trust – thus fostering social capital. Rao-Nicholson et al. (2017)
agree that this is important to support and encourage social innovation, but emphasise these
partnerships must involve both private and public actors to successfully overcome institutional
voids. Another form of support are so-called ‘intermediaries’, which tend to emerge when
market institutions are absent (Dutt et al., 2016). The authors outline two types; firstly, market
infrastructure development intermediaries which focus on services that support general
commercial activities, and secondly, business development capability intermediaries which
focus on the support and improvement of specific organisations. The role of mindful
governmental support in emerging economies has further been underlined in the literature,
where policymaking should strive to legitimise, acknowledge and facilitate operations of social
enterprises in their quest to address social problem and build institutions (Roy & Karna, 2015;
Hall, Matos, Sheehan & Silvestre, 2012)

Examples of actors that could support social enterprises seem plentiful; Lan et al. (2014)
mention both public and private institutions, but also corporations, scholars and NGO’s as
potential avenues to obtain capital, capability building, training, technical skills, business
advice and mentoring. It can be argued that these actors, combined with contextual
characteristics and social networks, make up a support environment necessary for social
enterprises to thrive. This is also referred to as an entrepreneurial ecosystem, which will be
further reviewed below.

13
2.3 Entrepreneurial Ecosystem
The concept of an entrepreneurial ecosystem, as a group of actors that support and facilitates
new ventures in a specific community, was first introduced in academia in 2006 by Boyd Cohen
(Alvdalen & Boschma, 2017). Nonetheless, the idea of entrepreneurship as a system made up
of different actors was introduced much earlier (Dubini, 1989). Much of the current literature
on entrepreneurial ecosystems has focused on identifying and understanding different types of
actors that support the development of new ventures (Roundy, 2017; Alvedalen & Boschma,
2017). For instance, Baharami and Evans (1995) highlight the importance for a new venture to
have access to venture capital firms, skilled labour, a service infrastructure, educational and
research institutions as well as an entrepreneurial spirit. More recently, Isenberg (2010)
identified that an entrepreneurial ecosystem where new ventures can thrive consists of six
essential domains: supporting policies and leadership, encouraging culture, availability of
financial capital, skilled human labour, venture-friendly markets for products and services, and
lastly, different types of institutional and infrastructural support (Figure 1).

Figure 1. Entrepreneurial ecosystem (source: adopted from Isenberg, 2011)

Isenberg (2010) outlines that although each ecosystem is unique and has its own features and
elements, it still consists of general factors that make up the socio-cultural (e.g., institutional
support) and economic capabilities (e.g., availability of venture capital firms), which determine
the nature of the ecosystem.

14
Even though Isenberg’s model (2011) has received a significant portion of attention, other
scholars have also attempted to conceptualise the idea of an entrepreneurial ecosystem. For
instance, Stam (2015) outline that an entrepreneurial ecosystem is structured around two types
of conditions: systemic conditions and framework condition. The systemic conditions are at
the heart of an ecosystem, and consist of the entrepreneurs own network, leadership, finance,
talent, knowledge, and support services. Stam (2015) argue that it is the presence and
interaction between those elements that determine the success of an entrepreneurial ecosystem.
The framework condition consists of four different social and physical components: formal
institutions, culture, physical infrastructure, and demand. These conditions are either enabling
or constraining the interaction between humans within an ecosystem. Although the concept has
been popularised in the academic field of entrepreneurship, the literature looking at it from the
perspective of social entrepreneurship is still limited (Roundy, 2017).

In an attempt to review the current state of the literature on social entrepreneurial ecosystems,
we identified 11 articles that were relevant. All articles were published after 2016, indicating
that the topic is on the rise but still very limited. After reviewing these articles, three key themes
evolved: A few articles were concerned about the definition and the design of a support system
for social enterprises. Other articles looked at the factors influencing a social entrepreneurial
ecosystem. Lastly, some articles analysed the role of collaboration and interaction between
actors within the support environment.

2.3.1 Social Entrepreneurial Ecosystem

As already established, social enterprises pursue missions that are different to those of
traditional businesses. Hence, different types of stakeholders and support institutions make up
the environments in which they operate in (Hazenberg et al., 2016; Barraket et al., 2017; Surie,
2016). Similar to Isenberg’s (2011) view on the entrepreneurial ecosystem, Barakett et al.
(2017) identified six domains of the ecosystem in their study on the social enterprise sector in
Australia, namely: communities, NGOs, governments, entrepreneurs themselves,
intermediaries, and educational institution. Even though there are some overlapping domains,
differences exist. For example, they outline NGOs as a crucial actor because of their
involvement in, and knowledge of, communities where social problems are present (Barraket
et al., 2017).

2.3.1.1 Defining and Designing a Social Entrepreneurial Ecosystem

In two articles, it was identified that a social entrepreneurial ecosystem could be divided into
macro and micro levels (Hazenberg et al., 2016; Surie, 2016). In her study on social innovation
ecosystem in India, Surie (2016) argues that to design a social entrepreneurial ecosystem
efficiently, different aspects on both the macro and micro level need to be considered. Firstly,
formulating an ecosystem on the macro level involves the establishment of specific government
institutions, favourable policies, and institutional support to facilitate the sharing of knowledge
and capabilities. Secondly, attention on the micro level should be directed towards facilitating
the entry of social entrepreneurs into the ecosystem, enabling access to additional resources
through the creation of stronger links with external for-profit organisation, and lastly, creating

15
a technology platform where the exchange of skills and collaboration can be promoted (Surie,
2016). Similarly, Jha, Pinsonneault and Dubé (2016) outline that an information and
communication technology (ICT) based platform in an ecosystem enables better performance
to solve complex social problems.

Hazenberg et al. (2016) takes this idea further and add two more layers: the statist and private
level. In their study on ecosystems in ten different European countries, they identified four
types of social entrepreneurial ecosystems: statist-macro, statist-micro, private-macro, and
private-micro. These types vary on the different levels of state, third party, and private sector
support combined with the geographical placement of the ecosystem, either national, regional
or local (Hazenberg et al., 2016). Barakett et al. (2017) outline that in its infancy, state support
is crucial in establishing a social enterprise sector as interest from merely the private sector is
insufficient. Contrary, Hazenberg et al. (2016) state that for instance, in a private-macro
ecosystem, the support from the state is inadequate and social enterprises are reliant on private
sector support through social investors, businesses and other actors. Even though similarities
exist between commercially focused ecosystems and socially focused ecosystems, different
factors influence the performance of social enterprises within an ecosystem, which will be
explored in the next section.

2.3.1.2 Factors Influencing a Social Entrepreneurial Ecosystem

Roundy (2017), in an attempted to conceptualise the interrelationship between an
entrepreneurial ecosystem and social entrepreneurship, argues that on the one side of the
spectrum, there are factors of an ecosystem that have an impact on the effectiveness of social
entrepreneurship. These factors include the diversity in resource providers support
infrastructure, a conducive culture, and opportunities for vicarious learning (Roundy, 2017).
Similarly, Hazenberg et al. (2016) outline that the diversity of stakeholders is crucial in shaping
the development of an ecosystem. Nonetheless, lacking some of these factors can also have
negative consequences. For instance, Scheuerle and Schmitz (2016), in their qualitative study
on increasing impact of social enterprises in Germany, found that it is difficult for social
organisations to establish themselves in a market if there is no supporting culture in the sector.
Further, the same authors identified three features of an ecosystem in their study that enable
social impact to be scaled up. Firstly, the willingness of stakeholders to provide support.
Secondly, the ability to access resources needed. Thirdly, admission from the formal and
informal institutional environment, meaning that both provide a favourable environment for
scaling. In their study, what hindered the scaling process was that stakeholders were hesitant
to provide capital, there was a tight budget of local municipalities, and they operated in a sterile
institutional environment (Scheuerle & Schmitz, 2016).

On the other side of the spectrum, Roundy (2017) also outlines that there are factors of social
entrepreneurship that have an impact on the effectiveness of an ecosystem. He argues that a
diverse set of social enterprises increases the diversity of support actors participating in the
ecosystem. Similarly, Surie (2016) argues that the more diversity of social enterprises present,
the more significant the impact on the ecosystem will be as it increases the availability of

16
resources for social enterprises. Further, Roundy (2017) also proposed that a higher density of
social entrepreneurial organisations increase the attractiveness and attention of the ecosystem.

With preliminary evidence that social enterprises can be useful in both addressing social
problems while remaining profitable, the sector has seen an increased interest from
stakeholders such as private and institutional investors as well as policymakers (Irene, Marika,
Giovanni & Mario, 2016). However, from the perspective of these stakeholders, the objectives
of supporting social enterprises are different. One the one hand, social investors are concerned
with both the social and financial impact created by the social enterprise. On the other hand,
policymakers and government bodies are concerned with indicators that assess the total
contribution to communities and people. For instance, how social impact created by a social
organisation can lead to savings for the government. Thus, there is a lack of shared and
recognised indicators to assess social enterprises, which hinders the growth of the sector (Irene
et al., 2016). Whereas there are many factors influencing the establishment of an ecosystem,
the willingness of actors within the system to collaborate is crucial in order to sustain and grow
it.

2.3.1.3 Collaboration within the Ecosystem

A central feature of a social entrepreneurial ecosystem is to foster collaboration and
partnerships to improve the capacity of social enterprises to ‘act’ and thus create more social
impact (De Bruin, Shaw & Lewis, 2017). Although this is a critical element for providing social
value to a community, the research on how, why and when collaboration takes place (De Bruin
et al., 2017), or how partnerships are formed within a social entrepreneurial ecosystem is still
limited (Slimane & Lamine, 2017). In a resource-constrained environment, the ecosystem tends
to be very weak. Thus, it is challenging for social ventures to accomplish both its social and
financial mission (McKague, Wong & Siddique, 2017). As a result, social enterprises are in
those circumstances likely to try and form partnerships with external stakeholders, such as
social accelerators. Pandey, Lall, Pandey and Ahlawat, (2017) identified in their qualitative
study on social accelerators that the likelihood of a successful collaboration is dependent on
the founding teams’ human capital. For instance, they identified that founding teams with task-
specific human capital (e.g. accounting, management and organisational skills) in comparison
to teams with generic human capital were less enthusiastic about collaboration. Instead, they
were only using the social accelerator to access funding (Pandey et al., 2017). Another way to
build capacity through partnerships in a resource-constrained environment is through social
franchising as it allows enterprises to make use of an already existing and more robust
ecosystem (McKague et al., 2017). However, for social entrepreneurial ecosystems to sustain,
certain aspects need to be fulfilled. Slimane and Lamine (2017) outline that a social
entrepreneurial ecosystem is based on the continuous and repeated interaction between
different actors. For continuous collaboration and partnership to exist within an ecosystem,
trust and shared values need to be established among its members. As a result of this, new
actors can be “co-opted by an existing member who vouches for the newcomer” (Silmane &
Lamine, 2017: 238). Lastly, as mentioned previously, the introduction of a technology-based

17
platform can also increase the participation and collaboration between different actors within
a social entrepreneurial ecosystem (Jha et al., 2016; Surie, 2016).

2.4 Social Entrepreneurship Research in the Philippines

The concept of social enterprises in the Philippines has been around for quite some time and
can be traced back to have its roots in the early 1990s (Dacanay, 2017). During this time, the
Philippines experienced a substantial growth of NGOs engaging in income activities due to the
limited availability of donations and grants (Dacanay, 2004). The increase of economically
active NGOs combined with the heightened global attention to the social enterprise movement
sparked the sector in the Philippines. As a result, new organisations supporting social
enterprises in the country were established such as the Philippine Social Enterprise Network
(PhilSEN) and ISEA. Also, educational institutions started to include the concept in their
curriculum (Japanese Research Institute, 2016, hereafter referred to as “JRI, 2017”). Since then,
social entrepreneurship has gained recognition as a way to reduce poverty and inequality in the
country. However, there is still no official definition of the concept in the country (JRI, 2016;
Ballesteros & Llanto, 2017).

Dr. Lisa Marie Dacanay (2012) argues that social enterprises in the Philippines often consider
the poor as beneficiaries, and refers to these as Social Enterprises with Poor as Primary
Stakeholders (SEPPS). She defines SEPPS as follow:

“SEPPS are social-mission-driven, wealth-creating organisations that have at

least a double bottom line (social and financial), explicitly have as principal
objective poverty reduction/alleviation or improving the quality of life of specific
segments of the poor, and have a distributive enterprise philosophy” (Dacanay,
2012: 51).

Dacanay (2012) explains that there are three critical aspects describing the nature of SEPPS.
Firstly, SEPPS are social-mission driven corporations that have an explicit aim to alleviate
poverty or to improve the quality of life for the poor. The poor themselves are involved in a
variety of ways, either as workers, clients, suppliers or as partners in a social enterprise value
chain. Secondly, SEPPS are also wealth-creating organisations with both a social and financial
mission. Just like any for-profit company, SEPPS are engaging in economic activities with the
intention of achieving financial sustainability. Lastly, SEPPS have a distributive enterprise
philosophy, meaning that the goal of the company is to generate economic and social value for
the poor as their primary stakeholders. SEPPS are, therefore, using any surplus profit to either
reinvest it into the enterprise to sustain its social mission or to distribute it to their stakeholders
(Dacanay, 2012). However, all SEPPS are not alike and some differ regarding initiatives,
organisational form or type of services provided to the poor.

Dacanay (2012) identifies that SEPPS assist the poor by providing transactional and
transformational services to foster both transactional and transformational roles. On the one
hand, social enterprises offer transactional services such as providing loans, sharing new

18
technologies, or providing necessary training so that the poor can take the role as workers,
clients, suppliers or owners. On the other hand, transformational services include activities
aimed at empowering the poor to take the role as change agents to lift themselves out of poverty
or improve the quality of life in their communities. These services typically include leadership
training and organisational development as well as experiential learning opportunities (ISEA,
2015; ISEA, 2017). Further, Dacanay (2017), in a cross case-analysis of SEPPS, suggested
three models of stakeholder engagement with the poor: control, collaboration, and
empowerment. Out of these three models, the empowerment model was discovered to have the
most significant qualitative impact on the poor to escape poverty. The rationale of this model
is to provide transformational services to engage the poor as transformational partners. Thus,
Dacanay (2017) suggests that it is crucial for SEPPS to provide transformational services to
increase their impact.

Even though SEPPS have received a significant level of recognition within the social enterprise
sector, some actors define the concept differently (Ballesteros & Llanto, 2017). For instance,
PhilSEN, define social enterprises with marginalised sectors as their primary stakeholder rather
than the poor (Padong, 2018). They define the concept as:

“A social mission driven organization that conducts economic activities providing

goods and services directly related to its primary mission of improving the well-
being of the poor, basic and marginalized sectors and their living environment.”
(PRESENT Bill, 2017: 1).

This definition considers the broad aspects of social enterprises as it includes not only
corporations with a social mission but also non-profits and NGOs with income-generating
activities (Padong, 2018). Contrary to both definitions, Ballesteros and Llanto (2017) argue
that current definitions are too broad and consider too many different types organisations, and
as a result, the concept is muddled. Despite the fact that there is no set definition of the concept,
the popularity of the social enterprise sector is continuously increasing, and more and more
actors are joining the movement.

2.4.1 The Support Environment in the Philippines

Historically, social enterprises and the surrounding ecosystem have primarily focused on
poverty alleviation efforts initiated by NGOs, cooperatives and microfinance institutions. More
recently, the same sector has experienced a rise of young entrepreneurs with more traditional
business mindsets (JRI, 2016). As a result, there has been a growing number of intermediaries
offering business-related services and other types of support. In an effort to map out the
ecosystem the RFF report (2017) identified eight different types of actors that were considered
as leading supporters of the sector (see figure 2 & appendix 2).

19
 Educational
Institutions

Social Non-profits &

Investors NGOs

Incubators & Social Industry

Accelerators
Enterprises Associations

Research &
Forums &
Support
Networks
Organisations
Government
Institutions

Figure 2. Ecosystem actors in the Philippines (source: Adopted from RFF Report, 2017)

In a quantitative study conducted by ISEA and OXFAM (2015) on poverty reduction and
women economic leadership in Asia, four types of stakeholders need to be engaged in building
a vibrant social enterprise sector: Civil society organisations, education and research
institutions, business sectors and social investors, and lastly, local and national government
bodies. This is supported in the RFF report (2017) where it is stated that there is a need for
increased private sector and government involvement. However, Ballesteros and Llanto (2017)
in their case study on NewGen SE argue that definitions need to be harmonised before enabling
government bodies to provide incentives for social enterprises. Further, the same authors
suggest that additional support is needed to provide incentives for mixed financing. For
instance, a more conducive environment for grant makers, international aid, CSR, and social
investors should be fostered. In a country analysis report made by JIR (2016), two gaps in the
existing ecosystem were identified: lack of human capital with business-related skills such as
financial or management skills, and lack of access to capital for each stage of social enterprise
development. After reviewing these articles, it became evident that substantial attention was
given to the policy environment in which the social enterprise sector operates in, and will be
further examined in the next section.

2.4.2 Policy Environment

Previous research describes the current policy environment in the Philippines as unresponsive
to the nature and potential of social enterprises to address and solve societal problems such as
poverty and inequality (ISEA, 2012). By tailoring policies, social enterprises would be enabled
to fully maximise their potential and reach more of their beneficiaries (RFF Report, 2017). As
written in the report from ISEA and Oxfam in 2015, there is no official recognition of the social
enterprise sector in the Philippines and its ability to play a critical role in fighting poverty.

20
Instead, the government differentiates between the size and number of employees of the firm.
For micro, small and medium-sized companies (MSMEs) there are various policies and
programs in place to promote and support such businesses. These incentives are primarily made
available through the 2008 law named "Magna Carta for MSMEs" and the "Barangay Micro
Business Enterprises (BMBEs) Act" of 2002. However, social enterprises are primarily
classified as any other conventional firm and do not receive any additional benefits, incentives
or support (ISEA, 2012; Ballesteros & Llanto, 2017). As a result of this weak policy
environment, a proposed bill for social entrepreneurship development, labelled "Poverty
Reduction through Social Entrepreneurship" or "PRESENT Bill," is debated in Congress (see
appendix 3) (ISEA & Oxfam, 2015). The PRESENT bill has been an ambitious work in the
making since 2012 when social entrepreneurs joined forces with practitioners, academe, NGOs,
institutions, and advocates to form the PRESENT coalition (ISEA & Oxfam, 2015; Ballesteros
& Llanto, 2017). Since then, the coalition has been engaged in discussions, promotion, and
lobbying to make the bill successfully go through the legislative process. Essentially, the bill
aims to support and incentivise social enterprises serving marginalised groups as primary
stakeholders, but also to recognise them as major vehicles for poverty reduction (ISEA &
Oxfam, 2015). Examples of provisions proposed in the bill include benefits such as; financial
and program support, preferential treatments in government procurement, tax incentives,
increased ability to obtain non-collateralised loans, initiation of development fund to distribute
resources for capacity development and the establishment of an insurance system to protect
social enterprises affected by natural disasters (Senate Bill No. 176; Ballesteros & Llanto,
2017; ISEA & Oxfam, 2015). Furthermore, the bill is seeking to raise awareness of social
enterprises among the general public.

2.5 Summary Literature Review

The get a clear image of the relevant topics for our purpose, the table below summarizes the
main areas discussed in the literature review.

Table 1. Summary literature review

Topics Covered Summary

Social entrepreneurship Although the research on social entrepreneurship has increased
significantly in the past decade, there are still disagreements of how the
concept should be defined. The most influential work come from
western countries disregarding contexts in developing countries.
Social entrepreneurship in Many scholars argue that the reason for why the concept has not yet
a developing country been appropriately defined is because social entrepreneurship is
different depending on the context in which it works.
Institutional voids On the one hand, institutional voids harm social enterprise as it often
makes it more difficult to acquire the necessary resources. On the other
hand, it promotes social entrepreneurial activities as the demand
increases due to weak or insufficient institutions.
Hybridity A challenge for many social enterprises is to balance its hybridity. At
the same time as social enterprises are a non-profit organization solving
social issues, they are also for-profit organisations concerned with
financial sustainability.

21
Social capital & local Social capital and the social connections within an entrepreneur’s
embeddedness network is an essential factor to overcome resource constraints. Building
social capital is fundamental when working with smaller communities
as it can have positive effects on trust.
External support environment For social enterprises to grow and make a sustained impact the support
from local stakeholders is crucial. As a social entrepreneur, it is
imperative to look beyond the immediate environment for support.
Entrepreneurial It refers to the social and economic environment surrounding enterprises
ecosystems within a specific region. Typically, an ecosystem consists of formal
support actors as well as a culture and network that influences social
enterprises.
Social entrepreneurial Although similar to an entrepreneurial ecosystem, social enterprises are
ecosystems likely to operate in environments with different actors.
Defining and designing an A thriving social entrepreneurial ecosystem must consider aspects on
ecosystem both the macro- and micro-level. Driving forces behind an ecosystem
are either private or state actors.
Factors influencing an ecosystem If there are more diverse resource providers, it will have a positive
influence on social enterprises. Similarly, if there are more diverse
social enterprises the more attractive the ecosystem will be.
Collaboration Collaboration within an ecosystem is an important factor to increase the
success of social enterprises. With the use of technology, the
collaboration between social enterprises and external actors can be
increased.
Social entrepreneurship in Although the concept has been around for quite some time, there is still
the Philippines no official definition of the concept in the country. Definitions so far
consider social enterprises as serving the poor or marginalized
communities.
Support environment With the rise of young social entrepreneurs in the country, there has also
been an increased amount of actors trying to support these
entrepreneurs. However, social enterprises are still struggling to access
financial and human capital.
Policy environment The government so far has not been active in creating a conducive
environment for social enterprises. As a result, private actors are now
pushing for a Bill to give social enterprises recognition but also
incentives.

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3 Methodology / Empirical Research
This section aims to explain our methodological reasoning in relation to our purpose. First,
we explain our research philosophy and elaborate on why we have chosen to follow an
interpretivist research paradigm. After that, we continue to clarify the exploratory nature of
our study and the reasoning for choosing an inductive approach as well as outlining why we
have chosen qualitative semi-structured interviews as our primary method of collecting our
data. Furthermore, we comprehensively outline the steps taken to collect and analyse our data
using a general inductive approach. Lastly, we discuss the ethical considerations of our study
and how we can assure the quality of our research.

3.1 Research Philosophy

Upon embarking on our quest for knowledge we must first establish our philosophical
standpoint regarding how we view the world and how knowledge is developed. Our values and
beliefs can have a big impact on the research, and clarifying our perspectives is critical if we
are to make any meaningful contributions to the field (Easterby-Smith, Thorpe & Jackson,
2015; Saunders, Lewis & Thornhill, 2009). The set of basic beliefs that represents a worldview
and guide research is often referred to as a research paradigm, and consist of ontological,
epistemological and methodological assumptions (Guba & Lincoln, 1994). Here, we embrace
a research paradigm often referred to as interpretivism. Consequently, we reject the notion of
positivism which seeks to unveil universal laws and explain behaviour through external causes
(Easterby-Smith et al., 2015; Guba & Lincoln, 1994). We firmly believe the nature of our
research topic within the realm of entrepreneurship is too complex to be explained in such
ways. Rather, we place focus on the meaning people assign to their experiences, the way they
think and feel, and how this is communicated. The main goal is to understand and appreciate
different experiences people have in the context our study is conducted (Easterby-Smith et al.,
2015).

In our study, we are primarily concerned about social enterprises in the Philippines and how
the entrepreneurial ecosystem enables these organisations, and how their support can be
improved. We firmly acknowledge there is not a singular answer to this question. For example,
we believe there are various ways to view, interpret and define an effective entrepreneurial
ecosystem. Translating this to an ontological point of view, we approach the research through
the lens of relativism. Hence, according to definition, we believe multiple truths exist
(Easterby-Smith et al., 2015). As Saunders et al. (2009) state, ontology deals with inquiries
about the nature of reality and existence. Since the entrepreneurial ecosystem, the social
enterprises and their beneficiaries are made up of a wide range of groups and individuals, we
adhere the belief that this reality is dependent on social actors and that people continuously
contribute to this social phenomenon – therefore embracing the view that reality is in fact
socially constructed (Wahyuni, 2012; Saunders et al., 2009; Guba & Lincoln, 1994). We
believe that depending on context, background and previous experiences, people will have
shaped different views of the world and assigned different meanings to things. Consequently,
they will possess different perspectives and provide different answers to our research questions.

23
The next question to contemplate concerns the sources of knowledge, also known as
epistemology (Easterby-Smith et al., 2015). Alternatively, epistemology can be explained as
the study of the criteria which we, as researchers, use to classify what and what does not
constitute as acceptable knowledge (Hallebone & Priest, 2009; Wahyuni, 2012). Here, we take
a subjectivist stance. Since we have previously acknowledged that reality is socially
constructed, we simultaneously accept that truth and knowledge lie within the human
experience. In accordance with Chilisa and Kawulich (2012), we approach our research with
the mindset that knowledge is bound to culture, dependent on history and influenced by context.
Accordingly, we conclude that the phenomenon of social entrepreneurship in the Philippines
is shaped by a multitude of factors, making it unique in its own sense. As a result, the only way
to fully develop an understanding, and draw out knowledge, of this subjectively formed reality
is to take the standpoint of the individuals who are participating in it (Scotland, 2012). Further,
the subjectivist stance means that interaction between humans and their world is what
constructs reality and knowledge (Crotty, 1998). It is therefore assumed that our potential
findings will be created through the actual interaction between us as researchers, and the object
of investigation (Guba & Lincoln, 1994).

3.2 Research Design

Considering the nascent nature of the topic in the developing country context of the Philippines,
no clearly defined problem has previously been formulated. Therefore, we have opted for a
qualitative exploratory research design where the predominant aim is to gain a deeper
understanding of the phenomenon at hand, a style often used where little research has
previously been conducted (Sounders et al., 2009). A qualitative study tends to be oriented
towards discovery and exploration, and is likely to focus on description, search for meaning
and theory building (Rudestam & Newton, 2014). This seems to align with our context-specific
setting where limited research has been performed. Further, it appears scholars agree there is a
need for such studies, considering that contextual factors heavily influence the field of research.
As identified in their recent literature review, Sengupta and Sahay (2017) call for qualitative
efforts to explore the phenomenon of social entrepreneurship within specific local and regional
contexts to generate conceptual frameworks and general theories. As we strive to gain a deep
understanding of the environment in which social enterprises operate, we must “tune in” to
multiple actors to gain different perspectives, and closely investigate their stories and the
meaning they assign to them. We conclude that semi-structured interviews are the best way to
do this, which we will expand upon in the method section below.
It has been noted that exploratory research does not aim to provide conclusive answers to
research questions, but rather seek to form an initial base that subsequent research can build
upon (Saunders et al., 2009). Sandhursen (2000), differentiate exploratory research from
conclusive research, which aim to identify a singular solution to an existing research problem.
On the contrary, we set out to explore our research questions to find a range of alternative
options how the ecosystem enables and can better support social enterprises to develop. To
accomplish this research purpose, we find it suitable to look at what is happening, seek new
insights, ask questions and assess the phenomenon in a new light - all features of an exploratory
study (Robson, 2002). This logic is shared in a study by Mair and Schoen (2007), where they

24
identify features and patterns among successful social enterprise business models. An
exploratory research approach was deliberately chosen because of the limited knowledge of
the topic.

3.2.1 Research Approach

Following our choice to conduct a qualitative exploratory study, the research approach is
consequentially determined. Generally, it is said that research approaches can be divided into
two distinct categories; deductive and inductive (Trochim, 2006). To further clarify, a
deductive approach starts at the top from theory, and then proceeds to formulation and testing
of hypotheses and propositions, to finally examine whether to validate or contradict the theory.
Considering the fact that limited research and theory building has been made concerning our
research question, a deductive approach is deemed unfeasible. In contrast, an inductive
approach starts at the bottom to identify patterns and build broader themes of a phenomenon
using the participants’ views, and through that generate theory and conceptual frameworks by
interconnecting the themes (Thomas, 2006; Cresswell & Plano Clark, 2007; Bryman & Bell,
2015). As we are exploring how the ecosystem is enabling NewGen SE in the Philippines to
develop and grow, a novel phenomenon in a specific context, we have chosen an inductive
research approach. This allows us to explore the topic open-mindedly with a rather blank
canvas as the starting point, and throughout the research process paint a picture of the current
situation. However, as pointed out by Saunders et al. (2009), this does not disregard the fact
we have used theory and literature, both prior to and throughout the process, to draw insights
about the research topic.

3.4 Literature Review

The research process began by conducting a literature review with the aim to gain a deeper
understanding of the topic. Easterby-Smith et al. (2015) outline two types of literature reviews:
traditional literature review and systematic literature review. In a traditional literature review,
sources are included based on what the reviewer considers to be relevant. Contrary, in a
systematic literature review, the reviewer does not choose the sources but rather appraise and
synthesise all relevant sources on a specific topic. Typically, systematic reviews consist of only
peer-reviewed articles, which are found by doing searches using databases such as Web of
Science (Easterby-Smith et al., 2015). Our initial strategy was to conduct a purely systematic
literature review. However, upon analysing the literature it became evident that social
entrepreneurship takes different forms depending on context, and differ to conventional
entrepreneurship in terms of support needed from their surrounding environment. Therefore,
we limited our systematic approach to two out of four sections. In the remaining two sections,
a traditional approach was used by identifying articles we deemed relevant (Easterby-Smith et
al., 2015).

In the first section, where we talk about social entrepreneurship in general, we included 13
articles. 11 of these were selected based on an analytic examination of the most influential
articles in the field of social entrepreneurship conducted by Stanford Social Innovation Review

25
(Hand, 2016). The remaining two articles were selected based on their high number of citations
and their significant relevance to our topic discussion. In the second section, where we examine
social entrepreneurship in a developing country context, we followed the logic of a systematic
review and used the following search query in Web of Science: "social enter*" OR "social
entr*" OR "social business*" OR "social innovation*" AND "developing* count*" OR "trans*
econom*" OR "emerging mark*" OR "developing market*" OR "developing nation*" OR
"emerging nation*" OR "emerging econom*". After conducting the search, we filtered it to
only include business and management articles. However, due to recentness of the topic we
included all relevant journals on management, entrepreneurship, social entrepreneurship, and
economics without regards to their impact factor. This resulted in 45 articles, and after reading
the abstracts of these articles we deemed 32 articles to be relevant. After examining these
articles in depth by reading their purpose, method and findings, 25 articles were chosen to be
included.

The third section looks at the topic of social entrepreneurial ecosystems. To introduce the
phenomenon, we first included a section on ‘entrepreneurial ecosystems’ as this is crucial to
understand before attempting to understand a ‘social entrepreneurial ecosystem’. Here we
examined recent literature reviews as well as influential work on the topic to gain a holistic
overview. We then proceeded to conduct our second systematic search of the literature review,
this time on ‘social entrepreneurial ecosystems’ where we used the following search query:
“social venture*” OR "social enter*" OR "social entr*" OR "social business*" OR "social
innovation*" AND “entrep* ecosystem*” OR “entrepr* system*” OR “ecosystem”. For this
search, we used the same filtering options as for the previous search on social entrepreneurship
in a developing country perspective, which resulted in 15 articles. After carefully reviewing
these articles by reading their abstracts, purpose, method and findings, 11 were chosen to be
included in the literature review. Finally, in the fourth section, we included literature in relation
to social entrepreneurship and ecosystems that has been produced in the context of the
Philippines. In addition to academic literature, we also chose to complement the literature with
country specific reports. These reports assisted us in mapping out and deepen our
understanding of the current sector as a whole, through identifying social enterprises as well as
actors within the ecosystem.

3.5 Primary Data Collection

The most common forms of primary data collection in qualitative research are interviews,
observations, and fieldwork (Myers, 2013). In this study, two different approaches have been
used to collect data. Firstly, we have used in-depth, semi-structured interviews as our main
approach to collect data as it allows researchers to get insights and unfold new dimensions
(Esterby-Smith et al., 2015). Secondly, as a complement to the interviews, observations have
also been made by attending events and immersing ourselves in a practitioner setting. Further,
interwoven in the observations are the numerous informal conversations (Merriam & Tisdell,
2015) we have held with both practitioners and ecosystem players throughout our stay in the
Philippines.

26
3.5.1 Qualitative Interviews
Interviews are one of the most important and widely used techniques when collecting data in
business research (Myers, 2013). Through interviews, the researcher can gather data from
people in various roles, settings, and situations. In comparison to conversations, interviews
follow a set of questions around a particular theme to explore topics or experiences in-depth
(Charmaz, 2014). Easterby-Smith et al. (2015) outline three situations when qualitative
interviews should be applied. First, when a researcher aims is to develop an understanding of
the interviewees ‘world’. Second, when the goal is to understand the constructs of the
respondents’ opinions and beliefs about a particular phenomenon. Lastly, if the subject matter
is sensitive or confidential, in which the participant may not be comfortable in other than face
to face interviews. In our case, the first two situations apply to our research, as we aim to
understand and gain a holistic overview of what factors of the ecosystem act as enablers. Thus,
the use of in-depth interviews is a relevant method for us to apply (Easterby-Smith et al., 2015).

Depending on the nature of the research, there are different types of strategies to utilise when
conducting interviews. These strategies can be classified into three different types based on the
needed extent of structure in the interviews: highly-structured, semi-structured, and
unstructured interviews (Easterby-smith et al., 2013; Myers, 2013). Saunders et al. (2009)
argue that when embracing an exploratory approach where flexibility is crucial, it is more
beneficial to either make use of semi-structured or unstructured interviews as it allows for more
open answers than highly-structured interviews. Furthermore, these two approaches also allow
the interviewer to identify nonverbal cues, which may be useful in making sense of the
participant's answers. Considering that we are taking a double-sided perspective, it could be
argued that some degree of consistency is vital as we aim to compare and contrast the views of
the entrepreneurs and the ecosystem actors. Therefore, we chose to make use of semi-structured
interviews as it allows for some consistency while being flexible to adapt if new questions
emerge during the interview. Semi-structured interviews typically involve the use of pre-
formulated questions without strict adherence to them. These pre-formulated questions tend to
be outlined in a so-called interview schedule or topic guide (Easterby-smith et al., 2015).

Before commencing with our interviews, two different topic guides were created: one for social
entrepreneurs and one for actors in the ecosystem (Appendix 4, 5). As suggested by Esterby-
Smith et al. (2015), there are three things a researcher should consider when designing a topic
guide. First, it is crucial to formulate questions that promote open-ended answers as it allows
the participant to reflect and report on experiences. Second, to keep conversations natural,
researchers may organise topics around stories. Lastly, to create a shared understanding, a topic
guide should include the clarification of any complex concepts used (Esterby-Smith et al.,
2015). These three aspects were incorporated in our topic guides. First, to keep a steady flow
of our interviews, we decided to break down the topic guides into five different parts:
formalities, social enterprise, the ecosystem, challenges, and opportunities. The part including
formalities was used to ensure mutual understanding of the research by providing informed
consent as well defining the concepts of NewGen SE and ecosystem. Then, we moved on to
the social enterprise part, which was used to provide ‘icebreaker’ questions around the specific

27
social enterprise or social enterprises in general, depending on the participant. The three
subsequent sections in the interview were more directly related to our research questions. First,
the ecosystem section was related to our first research question about enabling factors. Second,
the section of challenges was related to our second research question. Lastly, the opportunities
section was directly linked to the third research question while also including closing questions.
To ensure the quality of answers and allow participants to reflect, we only asked open
questions. When needed, ‘probing’ techniques were used to extract further information by
asking follow-up questions (e.g., can you tell me more about that?) (Esterby-smith et al., 2015).
Further, to establish a natural conversation each section included at least one question framed
in a way that the participant could answer it with a story (e.g., can you tell us about a time when
you received/given support from/to the ecosystem/social entrepreneur?).

To summarise, we conducted twenty different interviews with ten different social entrepreneurs
and ten different ecosystem actors (see table 2). In total, we managed to collect over 23 hours
of qualitative data using semi-structured interviews. All interviews were done face to face.
Apart from taking notes throughout the interviews, we also recorded each interview with our
smartphones. After each interview was conducted, we made extensive summaries by looking
over our notes and re-listening to the recordings, and then taking out the most relevant parts of
each interview. However, to ensure the quality of our participants we had to first establish some
criteria, which will be expanded upon in the next section.

Table 2. Interview summary

Organisation Position of Interviewee Date Length of Interview

Entrepreneurs
Big Mike Bike Solutions Founder & CEO 02-21-2018 64 min
Good Food Community Founder & CEO 02-22-2018 52 min
MAD Travel Founder & CEO 03-12-2018 62 min
Habi Footwear Founder & CEO 03-23-2018 108 min
Kalsada Coffee Founder & CEO 03-16-2018 47 min
CITIHUB Founder & CEO 03-07-2018 60 min
Tsaa Laya Founder & CEO 03-12-2018 102 min
Human Nature Founder & CEO 02-23-2018 77 min
Hapinoy Founder & CEO 03-19-2018 68 min
Messy Bessy Founder & CEO 03-10-2018 84 min
Ecosystem actors
Bureau of Small to Medium Managing Director 03-06-2018 67 min
Enterprise Development, - DTI
Office of Senator Bam Aquino Director for Programs 03-21-2018 72 min
Impact Hub Brand Specialist 02-28-2018 50 min
GK Enchanted Farm Co-founder 03-02-2018 80 min
British Council Regional Business Manager 04-04-2018 66 min
Bayan Academy Head of Consultancy & Research 03-22-2018 93 min
Technologies
Xchange Director 03-06-2018 60 min
Ateneo Centre for Social Director 04-05-2018 89 min
Entrepreneurship (ACSENT)
Ateneo De Manila University Professor 03-22-2018 71 min
BPI Foundation Associate Director 03-19-2018 61 min

28
Total 1433 min

3.5.1.1 Selection of Participants

Easterby-Smith et al. (2015) outline two different types of sampling designs: probability and
non-probability sampling. In probability sampling, each member of a population has the same
given chance of participating in a study. The selection of participants is mostly based on
randomisation techniques, which is commonly used when making statistical inferences.
Contrary, in non-probability sampling, participants are not selected randomly, and only some
members of a population have a chance to be selected for participation. Rather than being
selected on a random basis, the selection is based on accessibility and judgement of the
researchers. Because of the nature of our research, we have therefore chosen to adopt a non-
probability sampling design. There are many different types of strategies to use in non-
probability sampling, but we mainly focused on two types of strategies: purposeful and
convenience sampling. Purposeful sampling is a strategy that relies on the judgment of the
researchers when it comes to selecting whom to include. Typically, for participants to be
selected, they must meet the pre-defined eligibility criteria set by the researchers. As a part of
this strategy, researchers can also utilise the maximum variation sampling strategy, which is a
technique used to capture a wide range of perspectives related to the topic (Easterby-Smith et
al., 2015). Before going to the Philippines, we established clear criteria what type of
entrepreneurs and actors to include in our study. Additionally, to get as many perspectives as
possible, we chose to include enterprises at various development stages (start-up, growth &
maturity) and actors from widespread areas of the ecosystem. Convenience sampling is referred
to the selection of participants based on the ease of access (Easterby-Smith et al., 2015). Due
to our limited time frame, network and knowledge of potential units in the Philippines we also
had to choose participants based on the ease of access. The following two sections will go into
more depth of the samples of entrepreneurs and ecosystem actors selected for this study.

3.5.1.1.1 Entrepreneurs
Considering the broadness of the social enterprise sector in the Philippines and the lack of a
unified definition, it is challenging to pinpoint what characterises NewGen SE. Even though
these enterprises tend to be established and operated by the youth, it is not necessarily limited
to it. What mainly distinguishes them from other social enterprises is that they often have a
more traditional business mindset. Therefore, we did not limit our criteria to a certain age.
Instead, we used criteria based on their structure and mission as outlined below:

● The social enterprise should be registered as a company

● Should either be financially sustainable or have the ambition to become so
● Should in some capacity address problems of poverty and inequality

As previously mentioned we aimed to get participants throughout all the stages of the business
development. Our goal was to have at least three social enterprises in each development stage.

29
After setting our criteria, we had to rely on our small number of influential contacts in the
Philippines to identify potential participants. As a result, we received the contact details to 18
founders of different social enterprises. Five of these social enterprises were considered to be
in the start-up phase, six in the growth stage, six in the maturity stage and one in the early stage
start-up with an uncertain future. After contacting the social enterprises that we deemed to be
most relevant concerning our criteria and ease of accessibility, nine agreed to participate in our
study. Four of these enterprises were in the start-up, two in the growth and three in the maturity
stage. Additionally, we managed to acquire one more participant in the growth phase after
referral from one of our other participants. Our final list of participants included ten different
entrepreneurs including enterprises at all stages of development (see table 3).

Table 3. Overview entrepreneurs

Name Founded Stage Descriptions

Big Mike 2015 Early-stage They enrich lives of people living in marginalised communities by
Bike start-up/ giving them access to electricity and clean water through
Solutions uncertain manufacturing a low-cost bike that generates electricity while
future cleaning dirty water. Currently, they have piloted the project in
several marginalised communities around the Philippines.
Good Food 2011 Start-up They aim to create a more sustainable society that benefits small-scale
Community farmers and consumers through a system known as Community
Shared Agriculture (CSA). Through this system, they connect
consumers and producers within a value chain of food production
through a subscription of harvest from a particular small-scale farmer.
MAD Travel 2015 Start-up They empower and inspire marginalised communities by offering
tourists to make a lasting impact through authentic and unique travel
experiences.
Habi 2011 Start-up They promote responsible fashion by offering footwear made by
Footwear mothers in low-income communities using upcycled materials.
Kalsada 2015 Growth They produce and sell coffee while building trust and partnership with
Coffee local communities by offering them machinery and equipment to
produce quality coffee. To increase the livelihood of these farmers
they pay them $1 more per pound than fair trade prices.
CITIHUB 2016 Growth They aim to reduce the living expenses for low-income workers by
providing safe, clean and affordable housing in central areas of
Manila. They do so by creating dormitories built with recycled
shipping containers.
Tsaa Laya 2012 Growth They tap into the indigenous tea culture of the Philippines by
combining different types of herbs, fruits, and tea leaves into unique
mixtures. When producing the tea, they also benefit rural communities
where livelihood is minimal by making them business partners to
produce the tea.
Human 2008 Mature This is arguably the most prominent and well-known social enterprise
Nature in the Philippines. They offer a wide variety of organic beauty and
personal care products sourced with local ingredients from the
Philippines. They work hard to employ low-income individuals from
rural communities to produce their ingredients.
Hapinoy 2009 Mature It is a program that enables small community stores to provide
necessary goods and services to the base of the pyramid. They also
empower these store owners to become successful micro-
entrepreneurs by providing capital, training, and infrastructure.

30
Messy Bessy 2007 Mature They are selling natural and chemical free household cleaning
products made by at-risk teenagers coming from disadvantaged
communities in Manila. These teenagers are offered work-training,
mentorship, value formation, personal development as well as
education through high-school or college diplomas.

3.5.1.1.2 Ecosystem Actors

Our initial aim was to include actors from all the eight different areas that were identified by
the RFF Report (2017) in the literature review (see figure 2). First, we established a list of
essential actors that we assumed relevant for our study. This list consisted of 15 different actors
that we were interested in contacting, including all identified areas except industry associations.
To ensure the relevance of these actors, and to increase our chances for a successful connection,
we shared our list with our network in the Philippines. As a result, we received names and
contact details to representatives for 12 of these organisations. Apart from using our network,
we also identified three other actors that were brought up through interaction with individuals
within the social enterprise scene. In total, we contacted 15 different support organisations
where ten agreed to participate in our study, as seen in the table below.

Table 4. Overview ecosystem actors

Organisation Type of Actors Descriptions

Bureau of Small to Government Institution They are an attached agency to the department of trade and
Medium Enterprise industry. Their mission is to promote and develop micro-,
Development, - DTI small- and medium-enterprises (MSME) in the Philippines.
They mainly initiate different types of programs addressing
the needs of MSME.
Office of Senator Bam Government Institution Sen Bam Aquino is a former social enterprise and co-
Aquino founder of Hapinoy. His office mainly supports the
development of MSMEs in the country, and he was the
first senator to push for the PRESENT Bill.
Impact Hub Incubator/Accelerator It is a global incubator with 81 offices around the world.
They support social enterprises in the country by offering
incubation programs, education, co-working space, and
access to an extensive network and community.
GK Enchanted Farm Incubator/Accelerator Gawad Kalinga (GK) is a community development
foundation that aims to end poverty for five million
Filipinos. The GK enchanted farm offers incubation for
social entrepreneurs as well as education to students
coming from rural areas lacking an opportunity to be
educated in the big cities.
British Council Research & Support Their support to the sector include government engagement
Organisation and policy, capacity building through funding and business
help, educational curriculum and lastly international
development.
Bayan Academy Research & Support Bayan Academy is a social development organisation
Organisation offering entrepreneurship education, mentorship as well as
training programs and services for social entrepreneur’s
development organisations, cooperatives, NGOs, and
MSMe.
Xchange Social Investor This is an incubator and impact investor for early-stage
social enterprises. They are an active investor that closely
work together with their portfolio organisations. Currently,
they have 14 organisations in their portfolio including
some of the most prominent ones in the country.

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Ateneo Centre for Educational Institution It is the university centre for social entrepreneurship from
Social Ateneo De Manila. Their main priority is to support the
Entrepreneurship ecosystem by providing the sector with programs in
(ACSENT) research, education and training, advocacy, and incubation.
Ateneo De Manila Educational Institution Ateneo University offers bachelor students the opportunity
University to create a social enterprise as a part of their thesis course.
It is a voluntary course, but many students each year decide
to take it instead of writing a classic thesis.
BPI Foundation Foundation BPI Foundation is the social development arm of the Bank
of the Philippines Islands. They are the sponsor of the BPI
Sinag event, which is the most significant social
entrepreneurship competition in the country.

3.5.2 Observations
As explained by Saunders et al. (2009), observations are a neglected part of research but have
the potential to enrich the collection of data. When exposed to a new setting, observations can
help the researchers to acclimatise and get a better understanding of a new environment.
Therefore, to gain a deeper understanding of social entrepreneurship and the surrounding
ecosystem within the context of the Philippines, we utilised observational methods as a
complement to our semi-structured interviews. Easterby-Smith et al., (2015) outlined two areas
of observational methods depending on the involvement of the researcher: complete
observation and participant observation. As a complete observer, the researchers maintain a
distance and avoid exposing their role as a researcher. In the latter, the researchers accept their
role as researchers while actively participating or engaging in the field (Easterby-Smith et al.,
2015). The social entrepreneurship community within the Philippines is a very tight-knit
community making it challenging to observe and interact without exposing your role as a
researcher. Further, since we were exposed to a whole new setting, we looked to immerse
ourselves in the community. Thus, we mostly took the role of a participant as observer (see
table 5). The nature of our observations was rather informal, and it did not involve extensive
note-taking.

Table 5. Overview of observations

Type of Host What How we interacted Time Spent

Observation Observing
Events ACSENT Pitch Event - Observation with 2 Hours
participation
- Informal conversations
MakeSense Panel Discussion: Tech x - Observation with 2 Hours
Agriculture participation
- Informal conversations
ISEA Round Table Discussion: - Observation without 3 Hours
Financial Institutions as participation
Catalysts for Women´s - Informal conversations
Economic Empowerment
Impact Hub Fuck up night: entrepreneurs - Observation with 2 Hours
talking about failures participation
- Informal conversations
Field Trips True Manila Visiting slum areas of - Observation with 6 Hours
Manila participation
- Informal conversations

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 Good Food Visiting rural - Observation with 12 Hours
Co. farmers/beneficiaries participation
- Informal conversations
Co-working Impact Hub Working in their co-working - Observation with 6 Hours
space space participation
- Informal conversations
Roots Working in their co-working - Observation with 6 Hours
Katipunan space participation
- Informal conversations

Even though observations were not our primary method for collecting data, they had a positive
impact on the qualitative interviews as it helped us to foster a deeper understanding of the
phenomenon in the Philippines. For instance, it allowed us to understand and relate to certain
context specific associations made by either actors or entrepreneurs during the interviews.

3.5 Data Analysis

Conducting qualitative research tend to result in large volumes of data, which can at times be
overwhelming for the researchers. Unsurprisingly, spending over 23 hours interviewing people,
and making extensive summaries of each interview (as mentioned in section 3.5.1), we
naturally ended up with large amounts of data. To make the process of analysing less
intimidating, Easterby-Smith et al. (2015) highlight that it is first essential to prepare and
organise the data adequately. The same authors suggest a systematic approach where all data
should be labelled consistently so that essential fragments can be identified. After having done
our interviews and written the extensive summaries, we created two separate documents where
we in one gathered all the data from the entrepreneurs, and in the other all the data from the
ecosystem actors. Each interview in both documents was structured similarly, using labels that
followed the logic of our topic guides.

Although the design of our study is closely linked to the concept of grounded theory, the goal
of our research is not to identify a new theory but rather understand and explore the
phenomenon. Thus, instead of using a grounded analysis where the aim is to go from codes to
a theory we have chosen to adopt “an inductive analysis of qualitative data” (Thomas, 2006:
241). This approach aims to uncover core themes or categories relevant to the purpose of our
research and create a framework or model with the most relevant categories. Similar to a
grounded analysis, the categories are derived from the development of different codes. As
suggested by Thomas (2006), the inductive analysis consists of five different steps (see Figure
3): initial reading of the text, identification of specific text segments related to the objectives,
labelling each segment to create first-level codes, reducing the overlaps and redundancy among
the codes, and creating a model or framework incorporating the most important categories.

Initial Reading of the Identification of Label the segments Reduce the overlap Creation of a
text specific text segments of text with different and redundancy framework or model
related to the codes among the codes incorporating the
objective most important
categories

Many segments of the

Many pages of text 30-40 codes 15-20 codes 3-8 categories
texts

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Figure 3. A general inductive approach to analysing qualitative data (Source: Adopted from Thomas, 2006)

We started off by carefully familiarising our self with the data by first skimming through the
texts followed by a more extensive read through while taking notes and keeping our research
purpose in mind. To make the process of extracting text segments simpler and ensure relevancy
of data, we first created an Excel document with two different sheets, one for the social
enterprises and one for the ecosystem actors. We grouped the enterprises based on their
development stage (Start-up, growth or mature) to potentially identify particular themes
amongst the different development stages. We decided to not make any separations amongst
the ecosystem players since we had a wide variety of actors that were all very different. We
also created three columns (top-level categories) that are linked to the objectives of our study:
enabling factors, development challenges, and opportunities for the future/ how to overcome
challenges. Further, after skimming through our material, we identified a lot information that
might not fit under any of our three top-level categories, but still relevant in terms of
understanding the broader context. Therefore, we added the fourth top-level category:
additional contextual influences, where we put all other text segments that were of interest, and
influencing the development of NewGen SE.

Once this document was structured and prepared, we could continue with our analysis. As
illustrated in figure 4, we started off by extracting the most relevant information and placed it
where it belonged in the excel sheet. Once these text sections were identified and extracted we
complemented them with our own informal observation when necessary. After having
extracted the most important sections from each interview we created our first line of codes by
shortening the sections to one short sentence (figure 4, 1st code). This resulted in around 100
different codes. After, we went through all of the codes and reduced the number of codes by
removing the irrelevant ones and grouping overlapping codes together under new codes (1 to
2 sentences). As a result, during our second stage of coding, we ended up with 37 different
codes across all interviews and top-level categories (see Appendix 5). Finally, we went through
all of our codes and seven different key themes emerged from our analysis: network,
collaboration, expertise, culture, intersections, resources, and government.

34
Figure 4.
1 Process
Processof
ofanalysing
analysingthe
thedata
data

3.6 Ethics
When conducting a research study, ethical issues appear at a variety of stages. These issues
cannot be ignored and need to be taken into consideration by the researchers (Easterby-Smith
et al., 2013). To guide us through the process of ethical consideration we followed ten well-
defined principles proposed by Bell and Bryman (2007) that deal with the protection of
participants as well as the integrity of the research community.

In order to ensure the protection of the research participants, several measures were taken into
account. Firstly, to ensure no harm of the research participant we always made sure of not
asking any questions that may be offensive in any way. Secondly, to protect the interviewee's
privacy, anonymity and to respect their dignity, a document describing their rights as a
participant was sent to every participant prior to each meeting (appendix 7). Further, this
document also ensured a fully informed consent, which was signed by both parties before
commencing the interview. Lastly, to ensure the confidentiality of the data, the transcriptions
have been kept in cloud storage only accessible by the researchers.

Regarding the last four principles that deal with the protection of the research community, we
also considered some measures. First, to avoid any deception about the nature of our research,
a brief outline of our study was sent for review to our contact person in the Philippines
(appendix 8). Once it was reviewed and confirmed, we used it as a template to contact our
potential interviewees to establish a mutual understanding. Second, to ensure that there was no
conflict of interests, we declared in the proposal our affiliation with ISEA, and that our study
is partly funded by SIDA. Third, both the informed consent and our research outline were
designed in a way to ensure honesty and transparency about our research. Lastly, to avoid any
misinterpretation or false reporting, all interviews have been recorded and transcribed. Hence,

35
if any doubts arise regarding the content of this study, we have the possibility to go back and
review the original statements.

3.6.1 Broader Ethical Concerns for Society

One of our key drivers and motivations to conduct our study within the field of social
entrepreneurship was our conviction about its incontestable positive effects. As the research
has progressed, it is still our firm belief that it has enormous potential to create long-lasting
positive outcomes in society. However, while being excited about the progression of social
entrepreneurship, we must also acknowledge some of the negative aspects of the phenomenon
that our study indirectly could promote and contribute to. For example, in the past there have
been several scandals in the Philippines involving NGOs and other socially oriented
organisations, which involved deception and corruption (Francisco & Geronimo, 2013).
Ultimately, this lead to the intended beneficiaries being worse off than before, and trust was
eroded from communities. Our study could potentially have implications for policy, perhaps in
the shape of governmental incentives for social enterprises such as tax breaks and preferential
treatment in procurement processes. There exists a risk that opportunistic companies and
individuals would try take advantage of such incentives to start social enterprises, engage
communities, and then leave whenever they find it suitable –without ensuring a long lasting
positive impact has been made. To avoid this, we have been diligent in trying to gather as many
opinions as possible. Hence, if policy makers or others choose to make decisions based our
study; we have to our full ability tried to deliver results that represent a nuanced picture of the
current situation.

3.7 Research Quality

Much of the criticism of qualitative research concerns the difficulty of replicating and
generalising the study, and therefore not being trustworthy. To address these issues, Guba
(1981) developed four criteria for qualitative research to ensure trustworthiness: credibility,
transferability, dependability, and confirmability. When conducting our research, we have
applied these criteria to ensure quality and trustworthiness.

First, as mentioned by Shenton (2004), credibility is a crucial criterion to fulfil in qualitative

research as it ensures that the findings of a study are coherent with its intention. To fulfil the
issue of credibility, Guba (1981) suggested researchers to use triangulation methods, which
involves retrieving data from several sources and using a wide range of informants. Apart from
only relying on interviews, we also gathered information from our observations. Further, to
ensure that experiences and realities were gathered from different viewpoints we included a
wide range of enterprises and actors differing in size, scope, development stage and objectives.

Second, Transferability is dealing with how well and in what ways a qualitative study can be
generalised to different contexts or situations (Shenton, 2004). According to many scholars,
findings of a qualitative study are specific to only a small number of individuals and particular
environments and therefore, cannot be transferred into different contexts. However,
Denscombe (2014) is offering an opposing view by suggesting that, although findings are

36
unique to a specific context, they can also be an example in a broader setting. Thus,
transferability in qualitative research should not be disregarded. Lincoln and Guba (1985) argue
that only a reader can make the transfer of a qualitative study to different contexts. To allow a
reader to make such transfer, the researchers must provide the readers with enough contextual
information about the fieldwork. Some authors add to this by stating that it is also crucial to
give the readers sufficient information regarding the boundaries of the study (Shenton, 2004).
Further, as outlined by Guba (1981), purposive sampling can also be used to address the issue
of transferability, as it tends to result in more in-depth information given by the participants.
To ensure transferability, we included extensive contextual information about the Philippines
as a country in general, as well as the current social entrepreneurship environment. Further,
upon agreement with all interviewees, we included necessary information about each
participating organisation as well as the length of the interviews. Lastly, by adopting a
purposive sampling strategy, we were able to interview individuals with extensive knowledge
and experiences in regards to our topic. Based on these facts, we believe that this study provides
enough information in order to be generalised into similar contexts.

Third, dependability corresponds to the act of ensuring reliability in a qualitative study

(Wahyuni, 2012). It takes all changes that may occur and how it affects the research into
account. Overcoming issues of dependability require researchers to disclose enough
information that the study could potentially be replicated (Shenton, 2004; Wahyuni, 2012). To
ensure dependability, we have included a detailed description of all the processes that we have
gone through during our research. Further, the topic guides including questions for both
entrepreneurs and actors is also fully disclosed in the study (Appendix 4).

Lastly, confirmability refers to the extent to which an external person can confirm findings of
a study and ensure objectivity (Wahyuni, 2012). Similar to overcoming issues of credibility,
researchers may here also apply triangulation methods to reduce the potential for investigator
biases (Shenton, 2004). As previously mentioned, we applied several triangulation methods to
reduce the potential for bias.

37
4 Empirical Findings
This section presents an overview of the empirical findings from our data collection. Firstly,
we explain the categories that emerged during the analysis of our data. After that, the findings
are presented similarly to how our interviews were carried out: enabling factors, challenges,
opportunities for the future, and additional contextual influences. Each section present the
categories of most relevance from the perspectives of both entrepreneurs and ecosystem actors.
However, as the last section was added to fit information relevant to understanding the overall
context, the categories chosen there are presented without making any separation between
entrepreneurs and ecosystem actors. Finally, we conclude the chapter by including a summary
of our empirical findings presented in a table.

4.1 Identified Categories

As previously mentioned in the method section seven different key themes emerged throughout
our analysis (see table 6). We identified that the information we gathered were both directly
related to the ecosystem but also to the broader context in which the ecosystem is located. Thus,
we decided to separate our categories into two different levels: the micro and macro levels.

Table 6. Identified categories

Category Description
The human contacts and connections used to exchange
Network information and experiences. This involves both the personal as
well as the professional network.
The formal, and mutual, relationships, agreements and
partnerships that chiefly aim to enhance the performance of the
Collaboration
organisation. This cooperation can occur within the ecosystem
but also with a multitude of external actors.
The wide range of skills within a particular field such as
business skills and soft skills. It also refers to the possession of
MICRO Expertise knowledge within certain areas deriving from exposure and
experience. Lastly, it also refers to the transfer of this
knowledge through mediums such as education and mentorship.
The financial means, human capital, technology and other assets
Resources that can be utilised by an organisation in order to function more
effectively.
The physical or virtual spaces, events and other forums that
Intersections accommodate interaction between different people and facilitate
the exchange of ideas, expertise and resources.
The intangible factors that directly and indirectly influence
behaviour, mindset and attitudes. Elements of social capital such
MACRO Culture as trust and reciprocity are good examples, but also success
stories and societal norms shapes culture and therefore impact
the ecosystem.
The policy environment and support structures that are imposed
Government by the state and its lawmakers. It also includes governmental
incentives and programs especially targeted to social enterprises.

4.2 Enabling Factors

From the perspective of the entrepreneurs, this section looks at the most critical support that
the entrepreneurs have received from the ecosystem that has enabled them to develop their

38
ventures. Here, five factors were identified as significant, out of which network was considered
the most important. From the perspective of the actors within the ecosystem, this section look
at the factors that have enabled these actors to support social enterprises, as well as other
underlying factors that enable social enterprises from their perspective. Three factors were
identified as important enablers for the ecosystem actors, out of which collaboration seemed
to be the most important.

4.2.1 Entrepreneurs
It was evident that across the three different stages of development the network of the
entrepreneurs was the most significant factor that had a positive influence on their
development. The other four factors identified as important were expertise, intersections,
resources and collaboration.

4.2.1.1 Network
Start-up
The enterprises currently situated in the start-up phase mainly outlined that their network
assisted in introducing them to other actors and people that could support them. For instance,
one of the start-ups said, “When we need support, we use the personal network we have to get
connected with players that could be useful, which has been working well for us so far”.
Another enterprise mentioned that “As a result of our involvement in […] we were introduced
to one of our current board members who have much experience in our industry”. Lastly, one
enterprise mentioned that “A family member of mine acted as a small equity investor in the
initial stages when we were in need of capital”.

Growth
From the growth enterprises, three out of three companies stated that the network played a
crucial part in their development, where one of them mentioned that it helped them to secure
funding whereas another used it for business support. One of the enterprises mentioned that
“After I randomly ran into […], she recommended me about competition in Singapore. I
listened to her advice and participated, which got me a significant equity based investment”
The other venture stated that “I do not need any external actor to help me with business skills;
I have enough people in my network that give me advice when I get confused”. Lastly, one
entrepreneur mentioned that “Because of my previous working experience in the industry I
already have a useful network that have helped me a lot”.

Mature
All mature enterprises highlighted that their network has been crucial in their development. For
these enterprises, the network mainly allowed them access to mentorship, and foster
collaboration. One of the enterprises stated that “Through my professional network I have
managed to receive mentors that have helped me to both ensure financial and social impact”.
The other enterprise stated that “Because my father was the founder of […] we were able to
identify communities to work with”. Further, the same enterprise also stated that “I am also a
member of Ashoka and Schwab foundation”. Similarly, the last entrepreneur also stated that

39
“We are also a member of the Schwab foundation, and they have provided us a lot with
personal support”. The same entrepreneur also stated that the industry of choice was based on
previous experience, “Because of my experience and network within the […] we naturally
decided focus on this industry since I saw a lot potential of how we can make an impact here”.

4.2.1.2 Expertise
Growth
All the growth enterprises outlined that some form of expertise is helping them or have helped
them in developing their ventures. The form of support received from these companies included
expansion of network as well as business model refinement. For instance, one enterprise
mentioned that “Apart from helping to expand our network outside the borders of the
Philippines, […] also helped us to structure ourselves so that we can show these people how
we can have a social impact while generating revenue”. Another enterprise stated that “After
winning a competition we received mentorship from […] and […] and they have mainly helped
us to stay on the path and balance our social mission with financial sustainability”. Lastly, one
of the enterprises mentioned that “The most important thing about the mentorship that we have
received is the connections and referrals to other people”.

Mature
From the mature companies, two out of three highlighted that expertise in the form of
mentorship and advice have helped them along the way to balance the social and financial
mission of being a social enterprise. One explained that “I have a few mentors that have been
very helpful along the way by helping me to ensure that I am reaching both my social and
financial goals”. The other enterprise said, “In terms of our social mission the advice we got
from […] was of great importance. They gave us a new perspective to think long-term when it
comes to working with our communities”.

4.2.1.3 Intersections
Start-up
From the enterprises located in the start-up phase, competitions seemed to help them in various
ways, including exposure to a network and getting their confidence level up. One of the
participants highlighted that because of a competition she became emotionally attached to her
idea and decided to pursue it further. That person stated that “We were a couple of friends that
came together at school to participate in the Hult Prize Competition, we won the competition
and what started as a dream to go abroad turned into a passionate mission”. Another
entrepreneur outlined the importance of competition regarding receiving initial funding and
advice; this person stated that “Winning the British Council I am a change maker got us initial
funding and introduced us to a jury member who became our mentor, and without this guy, we
probably would have never continued to pursue our mission”. Further, one of the enterprises
highlighted that participating in a competition was the initial exposure to a larger network; this
person said, “After participating in a competition abroad we gained much confidence after
various people we met saw potential in our model. Apart from confidence, we were also
through this competition connected to a person who eventually gave us a very beneficial loan

40
when we needed it”. Lastly, one enterprise highlighted the importance of access to online
platforms to generate funds and market themselves; this person stated that “We also tried the
local crowdfunding platform SPARK Project where managed to raise initial capital as well as
getting our name out there”.

Growth
From the growth enterprises, two out of three outlined that competitions played a crucial role
in their development, especially regarding receiving extra benefits after winning. One
enterprise mentioned, “Winning the British Council I am a change maker and receiving
100,000 PHP, helped me to get started and become serious with the development thanks to the
initial funding and confidence it gave me”. Similarly to the previous founder, and to those in
the start-up phase, another stated that “Participating in and winning the BPI Sinag helped us
with the capacity building since we received 500,000 PHP, but the most important thing was
that we also received mentorship afterward”. Further, the same enterprise also outlined the
positive effects of attending networking events, “I am also a member of Impact Hub in Manila
where I have attended many networking events, and many of my team members were found
through these events”.

4.2.1.4 Resources
Start-up
As mentioned in the previous section, participating in the competition and receiving initial
funds was an essential factor in the early stages. For example, one entrepreneur said it “Allowed
us to get enough funding to start and register the company”. Another enterprise mentioned that
even though they believe it is not sustainable to rely on grants, “The grants are beneficial for
us when working on developing the communities which we work for rather than developing
ourselves as a business”.

Growth
For the growth enterprises, access to resources mainly helped them with capacity building. One
of the enterprises stated that “The investment from […] helped us to provide our communities
with the necessary machinery needed to produce”. Further, another enterprise also highlighted
that “Access to financial capital has for sure been the biggest factor for me during my
development as it has allowed us to make machinery investments as well as engaging more
with our partners”. Apart from capacity building, one enterprise highlighted that resource
acquisition through the use of online platforms was an important enabler for them; this person
said that “We used both Kickstarter and Kiva to raise money for investments in machinery”.

4.2.1.5 Collaboration
Growth
For the growth enterprises, it was identified that some form of collaboration helped them to
access markets or resources. One of the enterprises explained that “To access land we made
joint-ventures with property owners, and together with them we also have a shared revenue”.
The same entrepreneur also highlighted that they are currently looking into a partnership that

41
will lower their costs significantly; “We are now looking to partner with […] because they
have over 17,000 abandoned containers which could be used for our operations”. Another
entrepreneur highlighted the importance of having a partnership with big corporations to access
bigger markets; this person said, “We are working together with some big corporations here
and in total we have over forty cafes and hotel in the country selling our products. We have
noticed that these companies are interested in the trend sourced locally”.

Mature
All mature enterprises mentioned that collaboration or partnerships had been a crucial enabler.
One of the enterprises pointed out that “Our collaboration with a microcredit bank has allowed
us to identify many community members to work with”. Another enterprise highlighted the
importance of collaboration both from the social and the business aspect; this entrepreneur
stated that “Our partnership with universities makes it easy for us to work with our students
since they are so flexible and accommodating with our student’s needs”. Further, the same
entrepreneur said, “Through collaborating with big companies we have received many
volunteers that help us with our financial side of our business”. Further, it was outlined that
“Our international partnership with […] have been beneficial since they helped us to define
our impact measurement”. Lastly, one entrepreneur mentioned that “Thanks to our
collaboration with […] we have been able to increase our impact and focus on
transformational rather than transactional services.”

4.2.2 Ecosystem Actors

From the perspective of the ecosystem it was evident that collaboration was the most critical
aspect that enabled the actors to support social enterprises. Even though not as consistent, many
actors highlighted their network and expertise as critical enablers.

4.2.2.1 Collaboration
Seven out of ten ecosystem actors highlighted that collaboration was a critical aspect. Many
respondents stated that the collaboration between different ecosystem actors is important when
serving social enterprises as it allows for more diversity and access to more resources. For
instance, one actor mentioned that “We are trying to establish an ecosystem ourselves by
bringing different actors together with the same mission of supporting social enterprises in the
country”. Similarly, another actor also stated that “When we are running our programs we are
always trying to combine different actors and work together with a variety of partners to get
diversity as well access to more resources”. Further, one other actor also highlighted the
importance of diversity when serving social enterprises; this person said that “For some of our
programs we are collaborating with […] since they are located in the city, and we focus more
on the rural. This creates an ‘exchange’ of opportunities, which we believe is important”.
Another actor who is also operating in more rural areas highlighted the importance of
collaborating with local government bodies to access more resources; this person said “We
have created a collaboration with DTI in this region. They have been supporting us by
providing technical support to some of the enterprises, which we are working together with”.

42
Lastly, one respondent mentioned that “One of our strengths as a small actor is that we know
our limitations. We know that we can only achieve things in collaboration with others”.

Some actors also mentioned that they are dependent on partnerships with other actors to sustain
their operations. For instance, one actor mentioned that “Our main source of income comes
from the partners whom we are collaborating with on certain programs”. Another actor stated
that “Since we are a small actor we naturally try to establish partnerships with big private
actors to access more financial resources”. Apart from accessing resources through
collaboration some actors also mentioned it as an important factor to create more awareness
and education about social entrepreneurship as a concept. For example, one actor mentioned,
“Together with […] we create case studies on all the participants in the competition that we
use for educational purposes for the following years batch”. Lastly, one respondent stated that
“We have to collaborate with media for our competitions as it is important to get the stories
out there and create more awareness”.

4.2.2.2 Network
Some actors emphasised their network as important when it comes to supporting the social
enterprises. It was evident that the networks enabled the social enterprises in various ways. For
instance, two actors highlighted that their network gave social enterprises access to a stable
market. One of the actors said the following about one of the social enterprises that they are
working with; “By introducing them to our network, they now have a strong collaboration with
Robinsons Supermarkets”. The other actor mentioned that “With our wide network of
communities and farmers we help our entrepreneurs to develop their supply chain and give
them access to a market.” Some other actors stressed the importance of their network as a way
to connect social enterprises with financial capital, where one of the actors stated that “Even if
we are not looking to invest in a company, we are always trying to connect them with other
potential investors within our network”. The same actor also mentioned that “Our network is
something that we have nurtured for an extended period and without it, it would be challenging
to help our partner social enterprises to scale”. Lastly, one actor stated that “To work with
government requires patience and that you have to know the right people”, highlighting the
importance of having an influential governmental network if you are looking for state support.

4.2.2.3 Expertise
Lastly, when speaking about NewGen SE, many actors identified expertise as an enabling
factor when developing the enterprises. It was suggested that many of them have obtained it
from previous experience, with one saying that “Almost all of the “successful” social
enterprises are coming from corporate backgrounds”, and subsequently reflected, “Maybe
that it is the learning curve of a social entrepreneur”. Another actor said, “My view is that
most entrepreneurs that have developed social enterprises either come from the corporate
world or as a newly graduated from University”, and another adding that “Some of them have
already had contact with entrepreneurship. They are all educated and have previous working
experiences”.

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4.2.3 Summary of Enabling Factors
After looking at it from both perspectives, it is evident that the network, as well as
collaboration, play the most important roles. From the perspective of entrepreneurs, the
network allowed them to reach out and connect with other people who might be beneficial for
their development. Further, through observation and conversations we noticed that the mature
enterprises had a much more comprehensive professional network both within the Philippines
and abroad including big corporations and well-established NGOs. Apart from being larger and
having operated for a more extended period, the mature enterprises were run by entrepreneurs
who all had previous corporate experience and connections to the development sector. Further,
it was apparent that from the perspective of the entrepreneurs, collaboration was a crucial factor
in the development to access a market and to lower the cost of operations. Similarly, the same
factor was an obvious enabler also for the ecosystem actors as it contributed to more diversity
while also allowing them to tap into more resources when supporting social enterprises.
Although not explicitly stated, we observed and understood that collaboration and partnership
were often accessed through the networks of the entrepreneurs or the actors. Lastly, an
additional interesting finding was that intersections enabled start-ups and growth enterprises to
get exposure to the ecosystem in terms of generating contacts, but also as a source of gaining
expertise and raising initial funds.

4.3 Challenges
From the perspective of the entrepreneurs, this section outlines the most significant challenges
faced in terms of developing their enterprises. Three significant challenges were identified, out
of which access to resources and the lack of expertise were seen as the two major hurdles.
Further, the government was also identified as a constraining factor. From the perspective of
the actors within the ecosystem, this section looks at the perceived challenges hindering
individual enterprises from developing, but also challenges faced by the sector as a whole.
Similarly, they also highlighted lack of expertise as a critical challenge. However, equally
important to many actors were some of the cultural aspects surrounding the social enterprise
sector in the Philippines.

4.3.1 Entrepreneurs
Apart from access to resources and the lack of expertise, the growth and mature stage
enterprises also highlighted the government as an obstacle.

4.3.1.1 Resources
Start-up
From the start-up perspective, accessing and retaining human capital was outlined as the
primary challenge, with all four of the enterprises emphasised it. Many of the enterprises
outlined the difficulty in competing with higher salaries from traditional companies. One
entrepreneur said: “We have many people that are willing to help out but not ready to commit
since we cannot compensate them”. Another entrepreneur similarly stated that “Keeping
quality people in the team is a hard challenge because for them to stay, we need to pay them

44
well.” Further, one entrepreneur also mentioned that “Hiring people with the right mindset and
low expectancy of salary is challenging for us”.

Growth
Two out of three enterprises in the growth stage outlined both human and financial resources
as significant challenges. One of the growth enterprises who had not yet received any
investments highlighted the challenge of accessing financial capital, whereas the other one who
was already invested in, outlined the difficulty of accessing skilled human capital. The first
entrepreneur stated that “One major problem is access to funding because we cannot lend from
banks and it is difficult to get good deals with impact investors”. The other entrepreneur said
that “It is expensive to employ mid-level managers and to compete with other firms that can
pay better. Many likeminded people want to work with us, but few with the talent required”.

Mature
From the perspective of the mature enterprises, two highlighted human capital as their biggest
challenge. Similar to the start-ups, one of the entrepreneurs stated that it is challenging to
compete against traditional corporations when it comes to salaries. This entrepreneur stated,
“We require people with certain skills and experience, but it is difficult to compete with salaries
of bigger companies”. The other entrepreneur emphasised that sustaining human capital is
more difficult than attracting it by stating “We are lucky that we have managed to attract that
many people that are likeminded, but the question is for how long we can sustain them”.

4.3.1.2 Expertise
Start-up
All four start-ups highlighted that working and dealing with partner communities were big
challenges. Some of the enterprises mentioned that due to their lack of experience and
knowledge they were struggling to maintain and build relationships. For example, one of the
entrepreneurs said that “Since we started out without any knowledge of how communities work
– going there and trying to build a relationship was difficult, and we have had to quit some
community partnership because of this reason”. Another entrepreneur said that they were
struggling to “Establish partnerships with communities since it is difficult to communicate with
them sometimes”. However, one entrepreneur highlighted that “It is less demanding if we work
in a community where an NGO is present because they already have the know-how of working
with that particular community. Whereas, when we work with communities without NGOs it is
tough to build relationships with them”. Lastly, one former student who started the social
enterprise during the time at university pointed out the challenge to earn trust from communities
as a young person. This person said that "Failures of so many projects have eroded trust from
the community. They think: here is another student who gives hope but does not act”.

Growth
The three growth enterprises mentioned that there was mainly the lack of some business skills
that are hindering them or have hindered them in the past to develop their ventures further. One
of the entrepreneurs explicitly stated that “Since my background is in development work,
efficiently making informed business decisions is a huge challenge for me”. Further, one of the

45
entrepreneurs also mentioned that “During the years 2012 and 2014 we were struggling a lot
with the development of our product”. Another entrepreneur added to this by also highlighting
the difficulty in having the expertise needed for both the social and financial mission, which
can make it difficult to attract investors. This person stated that “A traditional enterprise only
has to measure one thing, and that is profit. We as a social enterprise have to continuously
measure two things, social and financial, which has been difficult for us and during talks with
potential investors this question always comes up, how do we ensure both financial and social
success?”.

Mature
From the perspective of the mature enterprises, it was evident that one big challenge they are
facing is the lack of soft skills such as leadership and communication skills. For instance, one
of the entrepreneurs stated that “We have now a sales team in the field with over 30 people and
just managing them and teaching them our culture is a big challenge for us”. Another
entrepreneur stated that “Managing the well-being of our staff can be quite challenging at
times, since you as an employee absorb a lot of emotional stories from kids, so it is easy to get
attached to issues, and it affects you”.

4.3.1.3 Government
Growth
All of the enterprises within the growth stage outlined that dealing with the government is a
challenge. The two enterprises who are operating under the Food and Drug Administration
(FDA) mentioned that complying with government regulation is tough. One of the
entrepreneurs said, “If we want to export it is very intimidating to fulfil all requirements set by
the government, and FDA is not straightforward”. The other entrepreneur confirmed this by
also saying that “Bureaucracy is a big challenge here in the Philippines compared to in
America. If we want to export the regulations are very tough and it is difficult to comply”.
Lastly, one entrepreneur mentioned that bribery is a big challenge. This person pointed out that
“For us to be able to build, we need to have a permit and if we do not put in a bribe, the permit
will take ages until it is approved”.

Mature
Out of the three mature enterprises, the two of them who are involved in production pointed
out rules and regulations set by the government as a challenge. One of the enterprise mentioned
that “Instead of working with us it seems like the government sometime is working against us,
and when you as a social enterprise is growing the government makes it difficult for you to
comply with everything.” The same entrepreneur also said that “It is complicated to get
products accredited”. The other entrepreneur similarly highlighted that “The government is not
very supportive, they are rather bureaucratic and make it tough to comply”. The same person
also mentioned that another issue with the government is that they have not recognised social
enterprises as a company form yet. As a result, she explains that “A big challenge for us is the
lack of recognition. Often, people and companies do not understand what we do since we are

46
not a charity nor a traditional business. Because of this, it can be tricky to find good
partnerships or get people to sponsor money for our foundation”.

4.3.2 Ecosystem Actors

From the perspective of the ecosystem, it was evident the lack of specific expertise and a non-
supportive culture were the two most significant challenges faced by social enterprises.
Moreover, the actors also mentioned the lack of resources and dealing with the government as
other challenges.

4.3.2.1 Expertise
When talking about the lack of expertise, some actors highlighted the lack of specific business
skills as a prominent challenge hindering the social entrepreneurs. One of the actors mentioned
that “Social entrepreneurs are brave, but they often don´t know how to bring a product to
market, they lack basic business skills such as the four P´s”. Another actor stated the same but
also linked it to the difficulty to access funding; this person said that “We often hear that there
is a lack funding here in the Philippines. However, there is a lot of funding available out there,
but SE often lacks basic skills such as comprehend a financial statement”. Rather than lacking
business skills some actors also highlighted that the entrepreneurs are lacking certain soft skills,
which are hindering them from developing. One of the supporters mentioned that “Most
entrepreneurs possess the right business skills through mentorship and education, but the soft
skills are still lacking and this is very important for social entrepreneurs”. Another actor added
to this by pointing out that “The social entrepreneurs tend to be shy and are afraid of
interviewing people, also they try to avoid honest feedback”. These skills could be attained if
there were more opportunities to learn, with one actor stating that “Social enterprises do not
have enough opportunities to receive mentorship, training, and education”. Lastly, one more
actor also said that “There is a lack of programs focusing on best practices for social
entrepreneurs”.

4.3.2.2 Culture
It was evident that many of the actors argued that the mindset of individual entrepreneurs and
their families are hindering the development of more social enterprises in the country. For
example, one actor pointed out that “It is challenging for students to commit to their social
enterprises after they finish their education because of the pressure from parents to get
employment and start supporting the family”. Another actor mentioned that “If they are facing
troubles when scaling, many social entrepreneurs tend to give up and go corporate instead”.
Further, one actor who is operating outside the borders of Manila outlined that many social
entrepreneurs in these regions lack self-confidence. This person said, “One reason why many
of the social enterprises in the Autonomous Region in Muslim Mindanao (ARMM) does not
take part in activities or competitions is because they lack the self-confidence to compete with
students coming from the well-educated backgrounds in Manila”. Apart from the mindset
being one challenge, one actor also highlighted that after being successful in competitions many
entrepreneurs become caught up in the fame and change focus. For example, this person stated

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that “We have had a problem with winners of competition who receive free professional
mentorship for an extended period not showing up for meetings and take the help given”.

4.3.2.3 Resources
Some players within the ecosystem highlighted the lack of financial resources as a factor
hindering the development of social enterprises in the country. More specifically, a few
outlined that throughout the growth stage, this is particularly tricky. For instance, one actor
mentioned that “During the development stages access to financial capital tend to be the most
difficult. The reason for this is because at this stage they need to invest for the future, but often
they cannot obtain bank loans without collateral, or they are not yet appealing enough for
social investors”. The same issue was also highlighted by another actor who pointed out
“Opportunities for funding in the growth stage are insufficient, there are not enough social
investors and many enterprises have to little assets which makes lending tougher”. Some
players did not think of this issue as specific to one particular stage but rather that “Access to
capital at all stages of the venture is a challenge”. Lastly, one actor also pointed out that “If
you do get funded through loans, the interest rates are too high, considering that you as a
social enterprise considers a triple-bottom-line and not only focusing on profit”.

4.3.2.4 Government
Similar to the entrepreneurs, a few of the actors emphasised that complying with specific
government regulation is a struggle. One player highlighted that “Complying with the
regulatory framework is very difficult for many social enterprises that are producing and
selling fast moving consumer goods (FMCG)”. Another actor also pointed out that “As a small
social enterprise you do not have the time and resources to comply with all regulations. Even
if you have a great product and a sustainable process you still need to prove to the government
that you are complying. Otherwise, you get penalised”. Further, one player also stated that
“The policy environment is currently framed in such a way that social enterprises have to
compete on the same terms as traditional corporations, which is not fair”. Some actors also
outlined the lack of commitment from government bodies to show support for the sector. For
example, one of the actors mentioned that “[…] take part in some discussions when we invite
them, but they still show limited interest and appreciation for social enterprises”.

4.3.3 Summary of Challenges

In summary, according to both the entrepreneurs themselves and the ecosystem actors, it is
evident that the lack of particular expertise seemed to be the most significant challenge
hindering social enterprises to develop. Interestingly, we have seen that the mature enterprises
outlined soft skills as a challenge in comparison to most of the enterprises in the start-up and
growth phase. These enterprises mainly outlined the lack of specific business skills and dealing
with communities as their biggest challenge. Additionally, both entrepreneurs and actors also
highlighted that access to resources and the government are two other challenges hindering the
development. However, as seen in the findings majority of the actors highlighted that lack of
financial capital was the biggest resource constraint facing social enterprises that are trying to

48
grow. Contrary, the entrepreneurs themselves highlighted the lack of human capital as the most
significant challenge. Another interesting finding, was that the entrepreneurs who highlighted
the government as a challenge were mostly enterprises within the FMCG or production
segment. This was also strengthened by some of the actors who also mentioned that complying
with regulation is difficult.

4.4 Opportunities/Overcoming Challenges

This section is presenting various avenues of opportunities to develop the ecosystem in order
to provide better support for NewGen SE. Both entrepreneurs and ecosystem actors elaborated
on ways to overcome previously identified challenges and general improvements of the sector.
The government was identified by both entrepreneurs and ecosystem actors as important to
overcome some of the challenges in the sector. Additionally, collaboration showed the second
most relevance in relation to overcome challenges and provide more opportunities for
development.

4.4.1 Entrepreneurs
In addition to government and collaboration, the entrepreneurs from the start-up and growth
stages also emphasised the need for more intersections to facilitate their development.

4.4.1.1 Government
Start-up
All four companies in the start-up phase mentioned the government as one of the keys to
develop the ecosystem further. From a policy perspective, one entrepreneur said, “If there were
more incentives for social enterprises, maybe more people would get involved”. Exemplifying
one type of incentive, another entrepreneur said that “I would like if the government could
support us by giving free machines”, while also acknowledging that – DTI (Department of
Trade and Industry) is now increasing market access opportunities which can encourage more
people”. Another one stated that “It would be useful for us to have a different governmental
body where we could seek help with business skills such as accounting and other financial
skills”.

Growth
Two out of three companies mentioned the role of the Government. One entrepreneur reflected
on the fact that “Social enterprises naturally do not make as much money as a regular
business”. Hence, incentives such as tax breaks would be useful, further arguing that “The
government should see this as a way of boosting the economy. Because if they invest in more
companies like this, they will have to spend less money on problems”. Another entrepreneur
thought back to the difficulties and costs involved in complying with regulations, such as export
requirements. As a way to facilitate this “It would be very good to have some (governmental)
program set up where SEs can share the cost and get advice how to follow regulations”. Also,
to facilitate access to funding, a proposition was made to “Try to pass a bill for equity
crowdfunding in the Philippines, as it currently only allows reward-based crowdfunding”.

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Mature
All three companies in the mature stage brought up different aspects of Government activity
that could help the sector. One entrepreneur emphasised that “We need champions in
government and industry”. Consequently, this could inspire “More recognition and a strong
citizen movement where the difference between social enterprises and others are clarified”.
Another entrepreneur highlighted the potential for government to facilitate collaboration by
“Creating a regulatory framework that makes inclusive businesses more interested in working
together with social enterprises”. Another entrepreneur also mentioned “Recognition and a
clear definition” as important, but also suggested the government or private actors to set up a
“Social stock exchange where people can invest”, or “An equity fund where change should be
primary focus, and returns secondary focus. Perhaps where donations are changed to equity”.

4.4.1.2 Intersections
Start-up
All start-ups brought up the importance of having more available intersections to provide more
opportunities to further develop their business. One entrepreneur said: “It would be good if
there was a common platform between all actors. This would facilitate the connection and
collaboration, and would expose us to more actors, and the actors would be able to better see
what social enterprises to support”. A second entrepreneur also suggested a platform listing
all actors in the ecosystem, which could be used to “Match government resources with needs
from social enterprises”. Similarly, another one stated that “I want to have a one-stop shop in
the ecosystem where all the enterprises can get access to a market, getting a network,
information, and experiences. Also, a forum where you can identify key actors who can help
you with the right thing”. Furthermore, it was also stated that “It would have been very useful
to increase the amount of workshops sessions, and have more places where likeminded
entrepreneurs can meet and discuss particular topics”.

Growth
Also among the growth stage companies, everyone mentioned things related to intersections.
Reflecting back to the beginning of the entrepreneurial journey, one said “I think if I knew who
to connect with ecosystem early on as an outsider it would have helped a lot”. Elaborating
further, the same entrepreneur said “Having nodes around the city and create smaller hubs
where people can meet, and not just limited to central Manila, because If you do so many young
and small-scale initiatives might be left out from the network and support they need”. Another
entrepreneur also suggested more physical spaces, where “Like-minded social entrepreneurs
can connect, share, gain market access, network”. A third entrepreneur suggested to form an
association among entrepreneurs where “You get to meet monthly or quarterly where you share
experiences. And when we want to lobby for something we can have a more significant voice”.

4.4.1.3 Collaboration
Start-up
Three out of four enterprises in this phase mentioned collaboration as a key to further grow and
develop. One entrepreneur spoke in general terms about the need to “Streamline the

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collaboration between farmers, SE and the government institutions”. Others spoke more
specifically about identifying partnerships with other businesses, both other social enterprises
but also private corporations. One entrepreneur said “Working with a big company in the real
estate business could potentially allow us create more awareness of social problems in the
wealthier areas”. Another spoke at length about a recent shift in focus to B2B, as “More
corporations are getting more interested in funding social enterprises; they might not be able
to impact us, but they can enable us”. Elaborating on this, the same entrepreneur said that some
companies want to move beyond CSR and rather “Want to integrate social entrepreneurship
aspects in their value chain”, concluding that “social procurement” is a great opportunity for
the future.

Mature
All mature companies brought up the importance of collaboration. The topic was not just
discussed in regard to potential benefits for their own sake, but also for the sector as a whole.
One entrepreneur said “Social enterprises need practical advice and access to bigger markets,
we need to open up our value chains to give them opportunities”. For example, the same
entrepreneur said “We want to nurture other social enterprises and become a platform for
scaling up, as they can use the existing infrastructure of our company”. The motivation behind
this is simply that “We can’t change poverty by ourselves, we need other actors”. Another
entrepreneur described this as a “Netflix strategy, where we sell our content and products by
others. Social enterprises help facilitate others while promoting themselves”. Another
entrepreneur described a different type of collaboration between social enterprises, “We focus
more on young entrepreneurs through workshops. We teach design thinking, and how their
business can be more inclusive. We are happy to share our tools and knowledge, and it is a
way for us to make some money as well – a type of social replication”. On the other hand, it
was also identified that collaboration need to happen with mainstream businesses too, with one
explaining that “It is clear to me that large businesses can become very purposeful because of
their resources and scale. But they do not always have the right intention and passion as the
social enterprises have to address social problems”. Therefore, there are opportunities to
complement each other and “We must find ways for these two actors to work more effectively
together”. One of the entrepreneurs identified one way to do this: “Create a group of business
owners. Look at what core business they have and identify social enterprises within similar
area”.

4.4.2 Ecosystem Actors

In addition to government and collaboration, the ecosystem actors emphasised the importance
of expertise within social enterprises but also increasing the awareness of sector as a whole.

4.4.2.1 Government
Similar to the entrepreneurs, also the ecosystem players repeatedly mentioned the government
as crucial to further develop social enterprises. Overall, it was highlighted by eight out of ten
actors. Some focused on the importance of being better recognised, with one saying that
“Social enterprises need to become recognised by the government so that they can get benefits

51
from doing the governments job in addressing the social problems here in the Philippines”,
and another stating that “The concept needs to find a unified definition”. A third one said, “I
would love if there was a special division under the DTI for social enterprises, to have one
voice from the government”. Others rather highlighted their role to provide support and
incentives. One actor expressed: “I would like to see a one stop shop for all governmental
services for all you need to do for compliance”. To facilitate access to finance, another
wishfully said: “The government could have a special budget only for social enterprises similar
to the maGIC in Malaysia”.

Others recognised the fact that there is already support in place. One example is the GoNegosyo
centres scattered around the country; “The aim of GoNegosyo act was to increase the
mentorship and training towards entrepreneurs as well as giving them access to a market
through the use of a network”. Similarly, another one said “There is a lot of support and grants
available. Each department can help in some way. There are also incubation/accelerators
through government”. However, as exemplified by one actor, “There are incentives even now
but it takes time to implement and for people to be aware. The PRESENT bill would help with
this, more people would be heard”. As the definitional debate continues, “Government could
look into designing new policies that are not limited to a definition”. Hence, there were also
legislative suggestions that would enable more social enterprises to develop. Three such
examples were: Firstly, “An inclusive business bill. This could influence big corps to have a
more inclusive value chain”. Secondly, “A social value bill exactly similar to the one in the
UK. This would allow the government to be a market for social enterprises”. Thirdly, “A bill
that would aim to unlock other forms of collateral. This would make it easier for social
enterprises to access loans to their business”.

4.4.2.2 Collaboration
Also among the ecosystem players, the notion of collaboration turned out to be a frequent
discussed topic as seven out of ten actors brought it up. There were a few different focus areas
with some talking about the importance for social enterprises to work closely together through
the sharing of resources. One actor said, “We want an environment where you can mutualise
as many resources as possible. Shared services needed on marketing, logistics, accounting,
design etc.” Another one further explained saying that “Hiring one accountant is very
expensive. If 15 social enterprises could share one accountant it is much more affordable-
Since most are small they would not need too much time each”.

Most actors, however, focused on the collaboration with conventional companies. One actor
said “The social entrepreneurship ecosystem has to gel with mainstream ecosystem. It is not a
separate galaxy”, and later added that “It would be great if social enterprises could be linked
with big players and add value to their product and value chain“. It was also pointed out that
connections to mainstream business is important since “Corporates are the ones that have the
power to make a big difference”. The reason to do this was further elaborated on by an actor,
saying that “Try and be part of a bigger company’s supply chain. You’ll get economies of scale
and can help more people - Once you get more capacity you can start producing more and sell

52
to more”. An additional avenue to explore is CSR as it is becoming more and more important
for big companies; “Social enterprises can fill a role there”.

Some also looked at the bigger picture and recognised the need for wide collaboration in the
private sector. One actor said “We need to have a much more collaborative atmosphere where
everyone is supporting everyone. We want to really find ways of collaborating with other actors
so that everyone can do a little bit more to help the social enterprises to scale”. Another one
gave an example of how to do this, saying that “There needs to be an umbrella organisation
for organisations interested in investing in social enterprises. In these organisations there
should be a diverse group of people included not only practitioners but also beneficiaries”.

4.4.2.3 Expertise
Five out of ten ecosystem actors brought up the importance of expertise. Most of them spoke
about this in relation to creating knowledge and awareness of the concept itself, and there
seemed to be an agreement that educational institutions are the best avenue to promote this.
One actor said, “There is a need that we have more faculty with real life experience that can
pass on knowledge”. Another one said, “Education is the key to create awareness of social
enterprises, so it is crucial that educational institutions starts teaching students about the
benefits of SE at early stages”. One actor explained what the outcome would be; “If we can
get more young people to choose this path it can have a big effect on the sector in the future
because the government will have to create a space for them”. Furthermore, one actor further
reflected that “Young people are needed to make more noise. Then more actors, like us, can
easier provide technical expertise and help them scale up so they reach a phase of financial
sustainability”.

Others also highlighted the need for technical and personal support from experts. One actor
reflected on the fact there is not a lack of resources out there, “But entrepreneurs are the ones
who have to do it themselves. They can’t be handheld, but they need help and support to be put
in right direction”. Another actor pointed out that “Personal and professional mentorship is
needed. You need right balance between taking care of yourself and the company. We have to
teach and prepare entrepreneurs”. The same actor continued saying that social enterprises
have different needs, and operate from a different standpoint than other companies. Therefore,
there must be “Easy access to subject matter experts that can understand your subject and
needs through the eyes of social enterprises”.

4.4.3 Summary
As understood in the previous section regarding challenges, the government and the policy
environment are seen as constraining factors. However, as seen in our findings in this section,
both entrepreneurs and ecosystem actors acknowledge, perhaps wishfully, that the government
also have potential to play an important role in unlocking many opportunities for the social
enterprise sector. Entrepreneurs want to see more incentives and support whereas the
ecosystem actors to a higher degree seem to recognise that the government in fact does provide
some support. However, they all agree that dealing with government could be easier through

53
gathering their services, for example in a “one-stop shop”. Also, a wider recognition of social
enterprises is crucial to bring the sector forward. Many also identify the promising
opportunities in enhancing collaboration within the sector through, for example, the sharing of
services. Interestingly, mature stage enterprises showed a great willingness to help younger
companies by sharing both knowledge and infrastructure. Both entrepreneurs and ecosystem
players also spoke about the importance of collaborating more with mainstream businesses, as
this could provide plenty of opportunities to scale up operations and increase their impact. Also,
the need for more intersections were identified, especially by the younger companies, as they
offer opportunities to exchange knowledge and experience, and find potential partners to work
with. The ecosystem actors rather focused on the need to develop the sector as a whole, by
facilitating the access to expertise through both educational institutions and service providers.

4.5 Additional Contextual Influences

As two outsiders, initially unaware of the local context in the Philippines, we soon realised that
developing a deeper understanding in which the social entrepreneurs operate was important.
Hence, this section will focus on the contextual factors that we observed, and often expressed
by our interviewees that directly or indirectly influence the development of NewGen SE as
well as the supporting ecosystem in the Philippines. Here, we have gathered voices from both
entrepreneurs and ecosystem actors to gain a collective view of the context they operate in.
Broadly, influencing factors related to government, culture and collaboration seemed to be of
the highest relevance.

4.5.1 Government
The role of social enterprises
One of the more notable impressions of the social enterprise movement in the country is the
ongoing struggle to define the concept itself. One ecosystem actor said “The definitional aspect
of social enterprises is something that has been the problem for many year”, and another,
“There is still a lot of questions about the definition of what a social enterprise is”. Similar
opinions were found among the entrepreneurs, one saying that “There needs to be a clear
definition and recognition of social enterprises”.

A few interviewees went one step further, trying to explain why the definitional debate
continues. To exemplify one of the issues with defining the concept, an ecosystem actor said,
“There is a mindset among some people that you should not make money from a social
enterprise”. Others appeared to boil it down to different opinions how a social enterprise
should operate. One mature-stage entrepreneur identified two positioning strategies; “Firstly,
bring solutions to markets where failure exists. Second, you go to already established markets
with a social purpose”. An ecosystem actor fully agreed with the first proposition, stating that
“Social enterprises should focus on areas where supply is low. In markets already saturated
by mainstream businesses there is no real need for social enterprises”. On the same topic, a
mature-stage entrepreneur reflected upon the difficulty to define the concept because “Many
businesses could call themselves social just by hiring from local communities”, but continued

54
saying that “For me that is more of an inclusive business, which includes almost all companies
in the Philippines are. You need to do more”.

Policy environment
Both entrepreneurs and ecosystem actors, link the definitional issue about the role of social
enterprises to the government. One entrepreneur said, “The government is unaware of the
concept and there is no policy program for social enterprises”. An ecosystem actor also stated
that “The policy sector is still lagging behind”, and another entrepreneur saying that “Nothing
separates us legally from other for-profit companies”. An ecosystem actor reflected on the
state of the social entrepreneurship scene saying that “There is enough happening to create the
spark, but not to get magnitude. For this to happen it is crucial to get Government on board”.

In all interviews we asked about the PRESENT Bill (Appendix 3) which, if passed, would
provide a clearer definition, formal recognition and potentially some incentives for social
enterprises. Although some seemed more engaged than others, eight out of ten entrepreneurs
think such a law would be beneficial, whereas the remaining two do not think it would have
any noticeable impact on their operations. Some were not so engaged saying “Not too much to
say. Would be good but It depends on the incentives we could receive. It is all about
implementation”, and “I don’t know much about it but I think it potentially could influence us
yes, especially concerning being recognised as an SE as it gives us the legitimacy”. Others
were more convinced saying “I think it would have a positive impact, I hope that this can help
to mainstream us” and “If there is some recognition of what a social enterprise is it could help
us to work easier with other companies”. One ecosystem actor identified that “Governmental
bodies have different lenses when looking at a social enterprise”, which make it harder to pass
the law. Another one highlighted the aspect of unfairness in the marketplace as an obstacle,
because “If a social enterprise enters a market with a similar product that is already existing,
and they are to get incentives it is not a fair playing field with mainstream businesses”. The
same actor continues saying that “The main issue is with the definition and distinction. How
do you make sure these social companies are what they claim to be?”. Another hurdle appears
to be the nature of politics as expressed by two ecosystem actors, “Of course in politics there
is more than one agenda”, and another “It is a struggle to get attention when there are so many
other priorities”.

Steering the conversation away from the definitional debate, there were also general thoughts
on the support from the Government. One ecosystem actor observed a lack of prioritisation as
“The Government need to develop a deeper understanding of social enterprises; it seems like
they focus mostly on micro/small enterprises with traditional business models”. However, it
was also expressed that there is in fact support available; “Local government units are offering
incentives but people are not aware of it” and, “There is a goldmine out there, but social
entrepreneurs are just waiting for things to happen”. Although many expressed the opinion
that governmental support is still lacking, there was a noticeable positivism about the
development of the sector as a whole among all interviewees. One entrepreneur said,
“Government are still behind in the development of the social enterprise sector, but in the past

55
decade, there are more private 'actors that are starting to take interest”. Similarly, an
ecosystem player expressed that “there is not so much focus, but there are for sure some
players who are pushing it”, and another saying “there is an increased interest from multiple
stakeholders”.

4.5.2 Collaboration
Although there exists much positivism around initiatives from the private sector there is also a
general recognition that a lack of coordinated collaboration exists. One entrepreneur said, “I
am happy to know that it is growing, but the ecosystem is still very young”, and because of that,
continued saying that “Social enterprise need to be more creative in finding ways to acquire
resources”. An ecosystem actor said, “The ecosystem is very young and needs to be developed”
and another said “At the moment there is too little support for social enterprises in the
Philippines and we need more people that support the fact that business should have more than
just an economic purpose”. Despite the fact support is limited, one entrepreneur highlighted
the sense of goodwill in the sector saying that “There is a lot of people and actors that want to
help and support new generation social enterprises”, but simultaneously said, “There is a lack
of matching support with social entrepreneurs who are in need”. Along the same lines, another
entrepreneur said, “There is support and money available, but in the space between
accelerators and incubators there are few actors”.

There were also some opposing views about the characteristics of the ecosystem, which
influence the collaboration between entrepreneurs and actors. Most interviewees described it
as rather small and only concentrated to certain districts of the capital city, Manila. One
entrepreneur said it is “A small and tightknit community where everybody knows everybody”.
Another entrepreneur said, “I believe that the ecosystem is very limited to Manila which is
unfortunate since there are many other places that would benefit from our micro ecosystem”.
However, an ecosystem actor also described the sector as “fragmented” and that “there is no
one voice”.

4.5.3 Culture
Attitudes and mindset
The rise of NewGen SE seem to reflect changing attitudes in society and a shift in mindset
among the youth. Five out of ten ecosystem actors mention these aspects when describing
NewGen SE, with one capturing this well saying “They have just evolved and I think it has a
lot to do with the time that we live in. We mentor a lot of younger local founders who want to
make an impact with their ventures and that have big beliefs that they can earn from doing
good”. Another ecosystem actor said, “More and more young people are looking for purpose.
Social Enterprises might provide an answer to that”, and continued saying that “Our
generation is starting to challenge CSR, and people start to realise that the social aspect
actually can be successfully implemented in the business model from the beginning, not after
you have been profitable”. As expressed by another ecosystem player, “The NewGen SE are
younger, have vision and try to address problems in more creative and innovative ways”,
whereas another highlighted their “Willingness to risk a lot of time and energy and youthful

56
years to test their social models to see what is possible”. However, it was also mentioned that
the image of social entrepreneurship might not match reality, with one actor saying that “Social
entrepreneurship is sometimes romanticised. At the start, you go to events and competitions
and you meet a lot of people”, and another adding that “Many NewGen SE think it is good
enough to merely include BoP, but there must be more efforts to let them know what exactly it
involves”.

In general, it seems like these entrepreneurs have little difficulty to stay true to the social aspect
of their businesses. It was indicated that many have the right attitude and willingness to do
something good, but are perhaps lacking the knowledge, skills and structure to do so. One
ecosystem actor said, “We see that young people are more socially oriented and very idealistic,
they want to make a difference”, and later added that “NewGen SE seem very committed to
their social mission and they keep going despite facing challenges”. Another ecosystem actor
reflected on what differentiate these entrepreneurs from others and concluded that “They
normally tend to have much more passion and drive for their solutions”. Also, because these
enterprises are generally started by younger entrepreneurs it was identified that “When you are
young there is no urgent need to make money, you can focus more on helping others”.
Consequently, the same person continued saying, “Perhaps, there is even too much focus on
impacts and less on the financial side”. Following this, another ecosystem actor firmly
cemented the position that running a NewGen SE is not the same as running a charity; “A social
enterprise is still an enterprise, they have to make money. It cannot just be a passion - If they
don’t make money, they won’t solve problem. Most people do it out of pity but it can’t be like
that”. Another ecosystem actor concluded that “So in general, they tend to have the right
mindset but lack the knowhow”.

Personal background and social norms

The challenge of balancing the social mission with financial viability seem to influence the
overall characteristics of the social entrepreneurs in the country, with one ecosystem actor
explaining that “Most of the successful SE come from wealthier backgrounds where families
can provide financial resources if necessary”. Another ecosystem player added that “coming
from wealthy backgrounds means you won’t starve if your venture does not succeed”. On the
other hand, it was also identified that coming from a certain socio-economic background could
have a deterring effect in pursuing a social venture. This was exemplified by one ecosystem
actor, saying that “There is a lot of interest but many hesitate to continue. People rather choose
to get a corporate job to make money. There is also pressure from the family to provide”, and
another one further explaining this phenomenon stating that “Parents who invest in their kids
and put them in good Universities expect them to start paying all bills once they graduate”.
Further, the same actor pointed out that “At the top universities most students are shaped in
similar ways – they are not exposed to the real problems in the country and instead shaped to
have a corporate mindset”.

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4.5.4 Summary of Contextual Influences
Evidently, there is a lot of enthusiasm and interest surrounding the social enterprise sector in
general, and the NewGen SE in particular. We observed that knowledge about the concept is
spreading and Universities are starting educational programs on the topic. However, one
ecosystem actor neatly summarised the current state of the sector, expressing that “what we
have noticed is that even though the number of social enterprises and actors supporting have
increased the amount of successful enterprise have not changed. The stories are the same, and
the same people that were the role models five years ago are still the same role models. So, we
are yet to experience more successful social entrepreneurs”. Put in other words, there are many
promising signs but so far it does not quite equate to an abundance of successful social
enterprises in the pipeline.

4.6 Summary Findings

Our empirical findings are summarised in the table below. It shows the relative importance of
categories that have been mentioned in regard to enabling factors, challenges, opportunities as
well as additional contextual influences. The green colour (x) indicates that the category has
been of significant importance. The table also sheds light on the differences between the
various stages of enterprise development (start-up, growth and mature), and the eco system
actors.

Table 7. Summary findings

Micro Macro

Network Expertise Resources Collaboration Intersections Government Culture

Enabling factors
Start-up x x x
Growth x x x x x
Mature x x x
Actors x x
Challenges faced
Start-up x x
Growth x x x
Mature x x x
Actors x x x x
Opportunities/overcoming challenges
Start-up x x x
Growth x x
Mature x x
Actors x x x
Additional contextual influences
All
interviewees x x x

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5 Analysis
This section is devoted to examining our findings in relation to the theoretical framework.
Through analysing the data from various angles and perspectives, we aim to produce an
understanding of the social entrepreneurship phenomenon in existence of a larger ecosystem
within the Philippines. First, we introduce and discuss the factors of the ecosystem influencing
and enabling social enterprises. After that, we analyse both micro and macro challenges
hindering social enterprises from developing. Finally, in light of our findings, a suggestion for
how the ecosystem can be improved to better facilitate the development of social enterprises in
the country is provided.

5.1 Enabling factors

As seen in figure 5, our empirical findings suggest that from a macro perspective the
government and the culture are simultaneously influencing and being influenced by the
ecosystem. One the one hand, the culture, and government are affecting the ecosystem in a
sense that it can either enhance or hinder the performance of the social entrepreneurship sector
as a whole. On the other hand, the performance of the sector can impact the development of a
culture or influence actions from the public sector. From a micro level perspective, our findings
suggest that the networks of the ecosystem actors and the social enterprises are the most crucial
features that allow social enterprises to grow and develop. Therefore, network has been placed
at the centre of our model (see figure 5). As outlined by many, the network appeared to be an
essential enabler to foster collaboration, to access resources and to retrieve necessary
expertise, which are other enablers for social enterprises. Further, as depicted in figure 5, our
findings also suggest that during the initial stages of the social enterprise development,
intersections are essential enablers as they expose enterprises to the ecosystem as well as
allowing access to primary resources and expertise needed to develop their enterprises further.
Although these micro factors were all considered important enablers, they influenced social
enterprises differently depending on the enterprise development stage, which will be further
discussed later in the analysis.

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Figure 5. A relational model of ecosystem influences on social enterprises (Source: Authors)

5.1.1 Intersections as a gateway

Intersections include many different things such as events, physical and online spaces, and
business plan competitions. In particular, our findings identified business plan competitions as
an enabling factor. Similarly, as outlined by both Isenberg (2011) and Stam (2015), the
presence of business plan competitions is a vital support factor in an entrepreneurial ecosystem.
However, neither Stam nor Isenberg explain the relationship between business plan
competitions and other aspects of the ecosystem. Our findings highlight that participating in
business plan competitions exposes entrepreneurs to a broader network of people and actors
within the existing ecosystem. Correspondingly, Motoyama and Knowlton (2018) identified in
a recent case study on the start-up ecosystem in St. Louis, USA, that business plan competitions
enhanced the interaction between competing entrepreneurs and other support actors. Further,
our findings also showed that intersections enabled enterprises in the early stages to access
necessary resources and expertise needed to develop their ventures further. Therefore, our
results suggest that intersections in the context of Philippines could be considered as a gateway
for social enterprises in the initial stages.

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Currently, the Philippines is experiencing a shift in mindset among people in the younger
generations. As highlighted in our findings, younger citizens today are increasingly looking for
purpose and social impact instead of conventional careers, and many see that social
entrepreneurship could provide an answer to those calls. However, while many have plenty of
passion, many of them also seem to lack the know-how. Further, as previously identified,
NewGen SE is the fastest growing segment of social enterprises (ISEA & Oxfam, 2015;
Ballesteros & Llanto, 2017). These two facts highlight the importance of an ecosystem to be
able to facilitate the entry of early stage enterprises and aspiring entrepreneurs. Surie (2016)
mentioned that on the micro-level, easing the access for social entrepreneurs is a crucial aspect
of building a thriving ecosystem. Thus, our findings suggest that intersections as gateways are
essential to successfully integrate new social entrepreneurs into the ecosystem, allow them to
expand their network, and provide easier access to resources and expertise.

5.1.2 Network as a facilitator

As mentioned by Maas et al. (2014), networking is a valuable tool to address challenges for
social enterprises in a resource-constrained environment. The first and the most evident insight
gathered from our findings supports this idea since the network showed the most relevance
among both entrepreneurs and ecosystem players to be a critical enabler. Lan et al. (2014)
identified that a network of external stakeholders that can provide support concerning
knowledge, financing, policy advice, and marketing is imperative to enable growth in a
developing country. Similarly, many of our interviewees highlighted that their network allowed
them to access resources, gather outside expertise, and lastly to foster reciprocity with external
actors through collaboration. From the perspective of an entrepreneurial ecosystem on the
micro-level, Stam (2015) state that networks are one out of six factors centred at the heart of
an ecosystem. Our findings support this argument but suggest that the network is the central
factor that enables other mechanisms of the ecosystem. Thus, our findings correspond with Lan
et al. (2014) and suggest that from a social entrepreneurial ecosystem perspective the network
is the facilitator that enables other relevant growth factors such as access resources, foster
collaboration, and access to outside expertise.

Our results showed that enterprises in the growth and start-up phase were enabled by access to
resources such as financial and human capital build to capacity. Similarly, both Isenberg (2010)
and Stam (2015) highlight that the availability of resources is naturally a central enabler for an
entrepreneurial ecosystem. However, they did not outline how entrepreneurs access resources
within an entrepreneurial ecosystem. Our findings highlight that during the start-up and
development phase resources were accessed either through intersections like events,
competition or online platforms, or as a result of their network. Interestingly, the mature
enterprises did not highlight access to resources as an actual enabler. As discovered in our
literature review, Maas et al. (2014) state that in an environment where resources are scarce the
importance of social capital increases. Further, Bhatt and Altinay (2013) highlight that
entrepreneurs with strong social connections have a better chance of flourishing under resource
constraints. Therefore, we can assume that as a result of the mature enterprises’ strong personal

61
network they already had access to many resources. Thus, resources like financial capital were
not clearly identified as an enabler, but rather perceived as given.

As discussed in our theoretical framework the impact created by social enterprises can be
increased through collaboration between and across sectors (Kolk & Lenfant 2015; McKague
et al., 2017). Our findings support this argument as almost all of the ecosystem actors
highlighted that for them to successfully help social enterprises, collaboration with different
actors is crucial. Further, from the perspective of the entrepreneurs, the more established
enterprises argued that collaboration is crucial to access markets and increase social impact,
whereas the start-ups did not mention collaboration at all. De Bruin et al. (2017) stated that
although it is clear that collaboration is crucial to provide social value to a community, the
research on how and when collaboration takes place is still lacking. Our empirical results show
that in many of the growth and mature enterprises, collaboration took place as a result of
connections within someone’s network. Thus, our findings suggest that collaboration is more
likely to happen during the later stages when the enterprise has established a broader network.

Access to expertise or certain knowledge was found to be essential for social enterprises.
Typically, this included mentorship and advice. From an entrepreneurial ecosystem perspective
mentorship commonly includes business advice and access to financial capital (Isenberg,
2010). Although the business advice is a fundamental enabler for social enterprises, our
findings indicate that mentorship from a social entrepreneurial ecosystem works differently.
Rather, focus is not limited to business advice but to ensure a balance between the social and
the financial mission. Further, as identified by the mature enterprises, some of the most useful
advice for social entrepreneurs are often less formal and more on a personal level. Another
function of mentorship is to provide entrepreneurs with networking opportunities (Isenberg,
2010). Our findings confirm this since it was mentioned to be significant by both the actors and
entrepreneurs. However, as already established, networks and intersections also enable
mentorship to occur. Our findings indicate that the start-up and growth ventures mainly
received their mentorship for a specified timeframe as a result of participating in a competition.
Contrary, the mature enterprises mainly received mentorship and advice from their network.
Therefore, our findings suggest that the mentorship received by the mature enterprises seemed
to be more on a mutual and personal level. Thus, the network is a crucial enabler to receive
impactful outside expertise, as showcased by the mature enterprises.

Although evident across at all stages that the network played an essential part in enabling other
support mechanisms, the effect it had for the mature enterprises appeared to be more influential.
Seemingly, the network of the more mature enterprises is much more comprehensive as a result
of their previous corporate background and already established connections within the
development sector. Therefore, our findings suggest that to grow and make an impact on a
larger scale the social connections within a network is imperative.

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5.2 Growth Vacuum
We found that the above enabling factors have allowed social enterprises to develop. However,
it was simultaneously evident that the rising interest and the current support within the
ecosystem have not translated into a significant increase in the number of successful social
enterprises. Thus, we suggest that the spark is there, but few initiatives manage to grow out of
the early stages to create the impact they initially promised. Hence, a growth vacuum seemingly
exists. Several challenges seem to contribute to this current state of the sector. Firstly, although
resources and expertise were seen as important enablers, it was also identified that acquiring
these proved challenging. Secondly, aspects regarding government and culture further
contributed to challenges faced by social enterprises.

5.2.1 Resource and Expertise as Constraints

On the micro level, our findings showed that the lack of resources and expertise were posing
the biggest challenges for both entrepreneurs and ecosystem actors to develop. Confirming the
RFF report (2017) and JIR (2016), two of the biggest challenges identified for the entrepreneurs
were the difficulty in accessing resources such as financial and human capital. Interestingly,
across all stages, the challenges of acquiring and retaining talent showed higher relevance than
the challenge of obtaining funding. This may be explained by the fact that the majority of
interviewees already had received some financial capital through various sources, and thus
rather perceived that as an enabler. However, funding appeared to interlink strongly with the
challenge of human capital, as it was often mentioned in relation to the difficulty to pay
employees competitive salaries.

Further, our findings also identified the lack of expertise as a hindering factor for social
enterprises to develop. Interestingly, the type of expertise lacking differed across the stages.
For the start-up companies, working with partner communities posed several challenges, thus
correlating with Roy and Karma (2015), who say that expertise and understanding of the local
context and social dynamics in communities is crucial for a social enterprise. Hence, this
explains why their lacking experience and knowledge to build relationships with the
communities could have a negative effect on their development. However, as seen previously,
a more expansive network, as showcased among the mature enterprises, could have the
potential to provide the bridge to overcome this challenge. Additionally, start-ups, alongside
growth companies, faced challenges in regard to business skills, thus confirming the findings
in the RFF report (2017). Further, many ecosystem actors also emphasised that early stage
NewGen SE often lack refined business plans and essential business skills such as basic
accounting, making it harder to acquire resources and develop the enterprise. Lacking these
skills may be explained by the fact that the entrepreneurs in these stages neither had the same
corporate experience nor the comprehensive network as the mature enterprises. Interestingly,
the mature enterprises rather emphasised the lack of soft skills as a minor barrier, suggesting
that the lack of expertise regarding business skills, or community knowledge, were not
significant challenges for them.

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5.2.2 Government and Cultural Constraints
On the macro level, both government and cultural factors appeared to influence development
of NewGen SE. Our findings show that the government seems to have a constraining effect,
most notable as the lack of support through institutions, policy, incentives and recognition. As
discussed in the literature, such gaps could be linked to ‘institutional voids’, commonly said to
hinder progress of social enterprises (Mair & Marti, 2009; Dutt et al., 2016). Generally, these
voids are characterised by a low accessibility to capital markets and human labour, and a non-
friendly policy environment, thus correlating to the identified challenges of low access to
resources and an unsupportive government.

5.2.2.1 State Inactivity

Although an acknowledgement exists that the government provides some support, the general
opinion is that it is not sufficient, and it is difficult to access. Evidently, in the absence of a
supportive government, the private sector has taken several initiatives and currently makes up
the core of the ecosystem. The reliance of private actors to provide support for social enterprises
corresponds with the “private-macro” entrepreneurship ecosystem identified by Hazenberg et
al. (2016). We found the ecosystem to be passion-driven and gradually growing, but it is still
small, tightknit and rather limited to the capital, Manila. This restricted reach could potentially
limit the engagement of ambitious social entrepreneurs outside this sphere.

To maximise the impact of the private sector in a “private-macro” ecosystem, it is also

highlighted that government should strive to adopt policies that facilitate the operations of
social enterprises (Roy & Karna, 2015; Hall, Matos, Sheehan & Silvestre, 2012). The need to
clarify the concept in the country has previously been identified, which was also mentioned in
our literature review (Ballesteros & Llanto, 2017). Correspondingly, we found a clear lack of
mutual agreement about firstly, what constitutes a social enterprise, secondly, the role of social
enterprises in the marketplace, and thirdly, whether social enterprises should be treated
differently to mainstream businesses. Hence, this sense of vagueness mirrors the discussions
in the literature, because the notion of social enterprises inherently seems to be a difficult
concept to pinpoint, contributing to the challenge of creating a legal framework. Although
many actors would certainly appreciate incentives such as tax breaks and preferential treatment,
the main concern was found to be the lack of clarity, acknowledgement and recognition. As a
result, there is lower understanding of the concept among actors in mainstream markets and the
general public, thus leading to the ambiguous context social enterprises operate in.

5.2.2.2 Norms and Success Stories

As mentioned earlier, cultural changes regarding attitudes may have a positive effect on
attracting young people to social entrepreneurship. However, culture could also be a
constraining factor. We found that there is significant pressure, especially if time and money
have been spent on good education, to pursue corporate careers to meet expectation from both
family and society. Also, providing for your family, regardless of the educational level, is of
outmost importance to many people in the country. Hence, many hesitate to fully commit to

64
the notion of social entrepreneurship, since it usually means less stability and less income. This
may be one of the reasons why the mortality rate among early social enterprises is considered
high.

Moreover, another limiting factor appears to be a lack of “success-culture” within the sector.
In fact, only a handful companies have managed to reach any substantial scale, and the success
stories from half a decade ago are still the same today. The three mature stage companies in
this study make up a significant portion of these. As mentioned by both Isenberg (2011) and
Stam (2015), the presence of success stories is a crucial aspect in fostering a conducive culture
within in an ecosystem.

5.3 Opportunities
The current status of NewGen SE can be analysed in two ways. On the one hand, the social
enterprise scene has been gaining momentum for several years, suggesting that the social
entrepreneurs are less concerned with lacking resources and expertise, definitional ambiguity,
policy environment and cultural obstacles. They are rather more interested in things they can
directly influence. Similar to what Mair and Marti (2009) expressed, they are capable of
looking beyond the apparent constraints and deploy strategies of bricolage to make the most
out of the current situation. On the contrary, as mentioned, it seems abundantly clear that
success stories are limited and few manage to further develop past the initial phases. Our
findings suggest that the few companies who have managed to scale did so mainly through
their own ability and personal network, rather than extensive support from external actors.
Thus, we suggest areas of improvement within the ecosystem should focus on addressing the
problem of the growth vacuum in order to enable more enterprises to make impact on a larger
scale.

As identified by Surie (2016), a social entrepreneurship ecosystem can be developed on two

levels. Firstly, on a macro level, it involves the establishment of government institutions and
favourable policies. Across all stages in our findings, government was identified as an
important key in unlocking new opportunities for the sector, and through that develop the
ecosystem and enhance the support for NewGen SE. This top-down approach would certainly
be a favourable scenario in which the sector would get a significant push in the right direction.
However, substantial governmental reforms in the country seem to take more time than social
problems can afford to wait. As long as definitions are not harmonised in the country,
Ballesteros and Llanto (2017) explain that the government is limited in their ability to provide
sufficient support, and thus efforts should be focused in other areas to create a conducive
environment. Hence, many have voiced the need for a bottom-up approach. This leads to the
micro level, the second layer of the ecosystem. Here, Surie (2016) highlights the importance
of creating an easily accessible infrastructure and a collaborative environment with both
internal and external actors. If enough momentum is created on this level the attractiveness and
attention of the ecosystem will increase (Roundy, 2017). Hence, we hope this could eventually
influence the macro level. As seen in figure 6, we propose this would most effectively be done
through focused efforts in fostering collaboration. We believe this can be one way to create a

65
strong pipeline of successful social enterprises that create both economic and social wealth,
and through that, as seen in figure 6, positively impact the existing culture and government.

Figure 6. The Manila Model: the reciprocal micro and macro ecosystem

5.3.1 Collaboration
Collaboration was identified as both as an important enabler and a promising opportunity to
overcome challenges. Thus, we suggest that the formation of more collaboration offer a fruitful
avenue to propel social enterprises through the growth vacuum into more fertile pastures.
Shown in our findings, we identified two types of collaboration that could create the much
needed momentum for social enterprises to leave their peripheral existence behind, and make
a more substantial impact. Firstly, intra-sector collaboration could increase the density of social
enterprises, and secondly, cross-sector collaboration could increase the diversity – both argued
to be crucial in a social entrepreneurship ecosystem (Roundy, 2017).

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Intra-sector collaboration
Intriguingly, we found that within the social enterprise community there is a lot of transparency,
goodwill, and an eagerness to help others. Creating this type of “altruistic culture” is said to
increase the possibility of success, both for the individual enterprise and the overall ecosystem
(Roundy, 2017). Going even beyond this, we observed that some of the mature enterprises
actively take the role in helping start-ups to develop by sharing their infrastructure, resources
and expertise with them, thus removing many of the identified hurdles. Further, some have also
opened their sales channels to younger social enterprises, therefore giving them access to
already established markets. This openness, possibly stemming from similar motivation and
the common objective of doing good, relates to the importance of trust and shared values in a
collaborative ecosystem, identified by Slimane and Lamine (2017). As suggested by both the
same authors and our findings, this results in a willingness by mature companies to vouch for
newcomers in the ecosystem and take them under their wings. Evidentially, this has a positive
effect on their development and could contribute to a higher density of social enterprises which
consequentially leads to an increased attractiveness of the ecosystem (Roundy, 2017).

Cross-sector collaboration
Kolk and Lenfant (2015) emphasise cross sector collaboration as a way to overcome resource
constraints as a result of insufficient governance. Similarly, we found a tendency among some
to look beyond the borders of the social enterprise sector, and engage in cross sector
collaboration with more mainstream businesses. This is a good example of “active
appropriation”, coined by Kistruck et al. (2017), in which relationship building takes place with
actors that are not explicitly labelled as socially oriented. In accordance with the same author,
we found that such collaboration benefitted the operations of the social enterprise and
contributed to an increased awareness of their social mission. More specifically, corporations
have the potential to provide infrastructure and expertise in areas such as technology, marketing
and accounting, but also give the social enterprise legitimacy in the commercial market place
(Domenico, Tracy & Haugh, 2009). Hence, it offers an interesting opportunity to overcome
some of the identified challenges. Apart from benefits to the individual enterprise, it could also
contribute on a wider scale as it relates to the idea of diversity within the ecosystem highlighted
by Roundy (2017). When a larger variety of actors get involved, it increases the awareness of
the sector and could potentially attract new types of ecosystem participants such as investors.
Ultimately, this could further contribute to the development of social enterprises. From the
other perspective, collaborating with a social enterprise could have positive effects on
reputation and trustworthiness of the corporation. Moreover, they can draw on social capital
built up by social enterprises in communities to increase local demand for the products and
services (Domenico et al., 2009). Hence, mutual benefits seem to exist with this type of
partnership.

5.3.2 How to Foster Collaboration through Intersections

The two types of collaborations outlined above are currently implemented by only a few
enterprises, and on a relatively small scale. As seen in our findings, a common problem was to
identify the people they could forge prolific partnerships with. Consequently, a need was

67
expressed to strengthen relationships both inside and outside the sector through associations,
groups or co-working opportunities. Here, because of their wide range of knowledge and skills,
the ecosystem could play a crucial role in facilitating that matchmaking process, both inside
the sector and with external actors, through the development of more intersections.

Earlier, we discussed intersections as an enabler for early stage social enterprises. Here, we
suggest that intersections should not only act as a gateway into the ecosystem, but rather, it
should also be physical as well as virtual spaces where already established players can come
together, share ideas and connect. Hence, we share the opinion of Surie (2016) about the
importance to develop such infrastructure to facilitate collaboration within an ecosystem.
Moreover, as previously established, intersections offer opportunities to expand one’s network,
which was identified as the key enabler to develop NewGen SE. A frequent suggestion brought
forward was the notion of having a technology based platform aimed specifically for the social
enterprise sector. This was supported in the literature where the implementation of such a
platform could enhance participation and collaboration both within the ecosystem, and create
stronger links to external actors (Jha et al., 2016; Surie 2016). Sharing information about both
the offer and the current needs would simplify the process of identifying suitable people to
work with. Thus, a platform could be one way to increase collaboration and overcome the
challenges of lacking expertise and resources.

Consequently, as seen in figure 6, we suggest that intersections should be located as a central

feature in the ecosystem as it offers wide possibilities to facilitate the development of one’s
network which could lead to fruitful collaborations and partnerships. Consequently, this could
result in more social enterprises leaving the growth vacuum, and collectively bring the sector
forward.

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6 Discussion
The broad nature of our research questions allowed us to explore a wide range of factors
influencing the development of NewGen SE. Looking beyond the immediate impact of the
ecosystem we identified three themes that seem to especially characterise and influence the
social enterprise sector. Firstly, the identified growth vacuum is discussed in relation to the
assumption that enterprises should aim for scale. Secondly, we dwell into the challenges and
implications of managing multiple partnerships. Thirdly, the perceived need for diversity
within an entrepreneurial ecosystem is discussed in relation to the current situation. Although
mentioned in the Analysis, we wanted to further explore these themes as they influence our
research purpose.

6.1 The Growth Challenge

The success of conventional businesses is typically determined by tangible measurements such
as profits, revenues or market share. For social enterprises, defining success is arguably more
difficult as they also consider additional intangible aspects such as social wealth creation
(Zahra et al., 2009), and value-creation (Santos, 2012). Hence, our findings pose some
intriguing questions since we identify what we label a “growth vacuum” in the sector and the
need for more “success stories”, indicating social enterprises and the ecosystem should focus
on scaling up. To fulfil the promise of social entrepreneurship to solve complex issues such as
poverty and inequality (Dacanay, 2012; Think Global Trade Social Report, 2015), it seems
relevant to reflect on the notion of growing and scaling and weather they are the most effective
ways to achieve that.

Weber, Kröger and Lambrich (2015) make the interesting point that scaling a social venture do
not necessarily have to adhere to the same principles as a conventional business. In the
traditional arena, scaling may focus on improving efficiency and reach economies of scale.
However, it can be argued that benefits from increased efficiency do not necessarily apply to
complex social issues. Therefore, scaling within the realm of social entrepreneurship put more
emphasis on increasing social impact rather than the relative growth of the enterprise itself
(Weber et al., 2015). Thus, by embracing this notion it seems there is no obvious contradiction
between scaling and ensuring positive, social change.

As mentioned in the literature review, scaling is said to be facilitated after certain preconditions
have been established, namely willingness, ability and admission (Scheuerle & Schmitz, 2016).
Here, relating this to our observations of NewGen SE, and their common characteristics
(Ballesteros & Llanto, 2017), there seemingly exist a willingness to scale among the founders.
The last two conditions relate to our identified growth vacuum, as NewGen SE may want to
grow but lack ability because of the shortage of expertise, resources and capability, both within
the organisation and through the supportive ecosystem. Moreover, our identified macro
influences, government and culture, may contribute to an environment which does not allow
admission to scale.

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6.2 Managing Multiple Partnerships
In our quest to understand the interactions between NewGen SE and the ecosystem, a picture
slowly emerged characterised by a complex web of relationships. Undeniably, social
enterprises cannot act in isolation in the pursuit of an opportunity (Diochon & Ghore, 2016;
Rao-Nicholson, et al., 2017). Rather, to fulfil their social mission while achieving financial
sustainability, social enterprises need to engage a multitude of different stakeholders, often
belonging in very different contexts (Ester & Dato-on. 2015; Battilana & Lee, 2014). At a
glance, it seems like a cumbersome undertaking indeed. Social enterprises must firstly deal
with coexisting identities inside the organisation in their pursuit to satisfy objectives belonging
both in the for-profit and non-profit world (Holt & Littlewood, 2015). Moreover, our findings
advocate the need to build and nurture different types of relationships with a variety of external
actors, further adding to the complexity of their existence. For example, establishing a
relationship in a rural community require a vastly different approach than developing a
partnership with a multinational corporation.

It certainly poses an intriguing query into how social enterprises can manage their hybrid
nature, as they straddle such a multitude of relationships and objectives simultaneously. As
pointed out, navigating through such a broad spectrum is challenging as the social enterprise
risk losing reputation and legitimacy among stakeholders if you cannot fulfil both social and
business obligations (Holt & Littlewood, 2015). Additionally, how do you establish that trust
in the first place without any prior experience? Our findings offer an interesting insight into
how to overcome such challenges. During the formation of a collaboration, Bryson, Crosby
and Stone (2006) note that the existing network is seen as an important enabler as it is often
through these networks that potential partners judge the trustworthiness and legitimacy of
others. Further, building legitimacy is often facilitated by the backing of a credible individual,
or organisation. Here, the ecosystem can play an important role in facilitating this process.
Firstly, a social enterprise can leverage the network established through the ecosystem to form
partnerships. Secondly, if interaction between the potential partners is initiated by a credible
actor in the ecosystem, perhaps through an intersection, legitimacy can be gained more easily.
Therefore, the ecosystem has the potential to enable the relationship building and act as a bridge
between social enterprises and their wide spectrum of partners.

6.3 Diversifying the Ecosystem

Further exploring the notion of Roundy (2017) that diversity among social entrepreneurs
enhances the performance of the ecosystem, provided reason to contemplate the current
situation according to the perception we had gained. A pattern started emerging as it gradually
became clear that most founders were educated at top institutions and came from stable
backgrounds, suggesting a certain level of homogeneity exists among the entrepreneurs. This
image was reinforced as the ecosystem was frequently described as a “tight-knit” community
and “very concentrated” to Manila. At the same time, the majority of the social enterprises
were community-based and operated in rural areas. Hence, it proposes an interesting case of
investigation if linked to the view of Manning et al. (2017), that the effectiveness of community

70
partnerships is enhanced if the social enterprise is locally grown. Hence, it could be suggested
that the development of fruitful relationships with communities in our study is hindered due to
the origin of the founders. To some degree this was mirrored in the findings as start-up
mentioned this as one of their major challenges.

Firstly, this poses a rather controversial suggestion, that solving social problems through social
entrepreneurship is exclusive to those with more affluent and educated backgrounds, where
your family’s financial position provide the necessary stability to develop your enterprise
without the risk of going bankrupt. Secondly, limiting the ecosystem to Manila could have the
consequence that plenty of potential is wasted. Aspiring entrepreneurs living in other areas,
perhaps with a more profound understanding of the social issues and therefore higher capability
to build trust and social capital, may not get the support needed to develop a business.
Therefore, returning to the notion of diversity, it seems to be of vital importance to promote
and support social entrepreneurship not just at the top universities in Manila, but also on a
grassroots level across the nation. Roundy (2017) speaks of the positive feedback loop: the
more social entrepreneurs that emerge, the more attention will be drawn to the ecosystem. The
attention will lead to a higher diversity of interested actors, such as impact investors. Thus, as
the pool of resources increases, it will attract a more diverse set of entrepreneurs into the
ecosystem.

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7 Conclusions & Implications
To begin with, this section provides a conclusion of our thesis by summarising our findings in
relation to our research purpose and questions. It then proceeds to present the theoretical and
practical implications this study has. Finally, the chapter and thesis are concluded by
highlighting the limitations, and giving recommendations for future research.

Both social entrepreneurship and entrepreneurial ecosystem literature have been receiving
scholarly attention in the past years. Despite the increased interest in both phenomena previous
scholars have mostly looked at the topics from individual lenses. Moreover, a majority of
literature on these topics are conducted from a developed country´s perspective, therefore
disregarding the contextual differences present in developing countries. As such, we took upon
us to explore how a new breed of social enterprises, NewGen SE, are influenced by the
surrounding ecosystem in the context of the Philippines. We aimed to gain a holistic overview
of how the local ecosystem is enabling NewGen SE to develop (RQ1). Further, our aim was
also to explore how an ecosystem can be enhanced (RQ3) to overcome challenges hindering
the progress of NewGen SE in the region (RQ2).

First, to answer RQ1, the initial development of NewGen SE is enabled by intersections such
as competitions or networking events whereas the growth social enterprises are mainly enabled
by the entrepreneurs’ and ecosystem actors’ own network. Firstly, the intersection exposes
entrepreneurs to a broader network and allows access to resources and expertise. Further,
changing attitudes and mindsets amongst young adults to engage in more purposeful careers
are also stimulating the development of social enterprises. Secondly, the networks of the
entrepreneurs and ecosystem actors are enabling social enterprises to grow. The network allow
enterprises to foster collaboration, access resources, and retrieve the necessary expertise, which
were considered to be the other top enabling factors.

Second, to answer RQ2, there are both micro and macro factors constraining the growth of
NewGen SE in the Philippines. As outlined by both entrepreneurs and ecosystem actors on the
micro-level, limited resources and lack of expertise are significant barriers for social
enterprises. Regarding resources, the entrepreneurs highlighted human capital as their biggest
constraint, whereas the ecosystem actors perceived funding to be the biggest challenge.
Although perceived differently, funding and human capital are interlinked, since human capital
often was mentioned in relation with not being able to compete with salaries of mainstream
businesses. Concerning the lack of expertise, different stages of development are facing
different types of challenges. During the initial and growth stages, enterprises have limited
business skills and lacking the knowledge of how to form relationships with beneficiaries. The
more established enterprises are often lacking certain soft skills such as social and leadership
skills. On a macro-level, the state inactivity is making it challenging for social enterprises to
compete with mainstream businesses. Furthermore, cultural aspects such as pressure from
family and society to pursue corporate careers, and the lack of successful social enterprises, are
hindering the growth of social enterprises. Influenced by these macro and micro challenges,

72
only a handful of enterprises have been able to grow and make an impact on a larger scale.
Hence, we identified a growth vacuum that currently characterise the overall sector.

Finally, to answer RQ3, the ecosystem should focus on addressing the problem of the growth
vacuum to enable more social enterprises to scale. To do so, collaboration within the sector but
also across different sectors should be increased through the development of more
intersections. These new intersections should be located at the centre of the ecosystem to fill
the gap of limited networking opportunities to facilitate the connection between enterprises,
actors and mainstream businesses. By doing this, we hope that NewGen SE can fulfil their
promise as vehicles for societal change by implementing new solutions on a wider scale. We
believe this will eventually influence the macro level, here referred to as culture and
government, which is imperative for the sector to reach magnitude.

7.1 Practical and Theoretical Contributions

We hope our findings will add to the existing research on the topic and prove beneficial to the
further development of NewGen SE and the surrounding ecosystem in the Philippines. In a
best-case scenario, entrepreneurs and ecosystem actors could draw upon the knowledge we
have collected, analysed and compiled to develop their current operations, and ultimately
enhance their societal impact. Moreover, we also hope that our study will be relevant in
contexts beyond the borders of our host country, perhaps most particularly in other developing
countries. Although the study took place in a very specific context, we have attempted to
provide rich information about our research setting to improve the transferability (Lincoln &
Guba, 1985), and thus give practitioners in other countries the chance to judge its relevance.

As identified in our study, specific factors of an ecosystem contribute to the successful

development of social enterprises. Besides, our study also argues that there are ways to improve
the ecosystem to better support the development of social enterprise. Thus, our study has
theoretical implication on ecosystem literature from the perspective of social entrepreneurship
in a developing country context. Furthermore, our study also has implications for practitioners
including the entrepreneurs themselves, and the actors within the ecosystem.

This thesis has attempted to shed light on social entrepreneurship as part of an ecosystem from
a developing country´s perspective. As such, firstly, our study contributes to the emerging
stream of literature on social entrepreneurship in the context of a developing country,
particularly in the Philippines. Building on the previous work of the RFF Report (2017) our
research extends the mapping out of the ecosystem by looking at relationships between aspects
of the ecosystem, and how they enable social enterprises to develop and grow. Furthermore,
considering the limited research on NewGen SE (Dacanay, 2017), our study contributes to the
conceptualisation of this new breed of social enterprises. Secondly, our study also contributes
to the literature on entrepreneurial ecosystems from the perspective of social entrepreneurship.
The majority of literature on both commercial and social entrepreneurial ecosystems have
looked at general factors affecting enterprises, disregarding the different stages of development
(Roundy, 2017). Our study looks at this phenomena through the lenses of enterprises at

73
different development stages. As expected, our findings indicated that social enterprises at
different stages of development need different types of support from the ecosystem.

Our research suggests several practical implications for both entrepreneurs as well as
ecosystem actors. First of all, entrepreneurs and actors with the goal of strengthening the
ecosystem should direct support to social enterprises that have the ability to scale. As identified,
an increased number of successful social entrepreneurs could enhance the performance and
diversity of the ecosystem, and ultimately, also positively influence the macro-level.
Furthermore, for entrepreneurs in the development stages it is also suggested to seek
collaboration with mainstream businesses as they can provide access to markets and allow
social enterprises to build capacity. To do so, however, more opportunities to foster
collaboration are needed. Considering the extensive knowledge, skills and network that many
of the ecosystem actors possess, they can play a crucial role in facilitating this matchmaking
process through the creation of physical and online intersections.

7.2 Limitations and Future Research

Although we believe that conducting our research as outsiders in the context of the Philippines
had many advantages, it also posed some significant limitations. Due to our limited knowledge
of the social entrepreneurship scene in the Philippines, we solely relied on the judgement of
our network when selecting participants for our study. Although the contacts we had
established prior to departure were reputable and reliable, we cannot guarantee that the
placement of enterprises in different stages are accurate, or weather all social enterprises
actually make a positive societal impact. Furthermore, during our research we did not interview
any beneficiaries. As a result, it is difficult for us to evaluate to what degree the support that
social enterprises received from the ecosystem actually contributed to social impact for their
beneficiaries and society at large. This would require researchers to gather deeper insights of
the operations of social enterprises. Therefore, a first suggestion for future research would be
through single or multiple case studies assess how support received from the ecosystem is
translated into social impact.

Considering our limited time frame and budget constraints we only focused on social
enterprises and actors located within a close proximity of Manila. As a developing country with
widespread inequality, regions outside Manila may differ significantly in terms of accessibility
of resources, personal background of entrepreneurs, and availability of institutional support.
Hence, a more geographically diverse sample group is likely to have generated different results.
Therefore, a second suggestion for future research is to conduct similar qualitative studies
focusing on other regions of the country to identify what enables NewGen SE to develop, and
how their needs for support are different compared to those in Manila.

Considering the identified need for increased collaboration between social enterprises and
mainstream businesses, we believe it would be interesting to examine the outcomes of such
partnerships. Therefore, a final suggestion for future research would be to take a multisided
perspective to see how the social enterprise impacts the mainstream business, and vice versa.

74
Additionally, it could also be explored how these types of partnerships influence customers’
perceptions towards both enterprises.

75
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Appendices
Appendix 1 – Challenges
Access to Finance
Firstly, access to finance is one of the major obstacles for social enterprises. This difficulty
cannot merely be explained by the lack of available cash and funding, but can instead be
described as a collection of several challenges. While 56% of the surveyed enterprises stated
that limited supply of capital is the primary constraint of financing, 34% mentioned that
unrefined business plans as the underlying problem for obtaining finance and 31% said that
their restricted network gives them poor accessibility to investors. Other issues reported include
limited track record of firm, insufficient generation of revenue to attract equity investors and
difficulties in obtaining a loan - often due to collateral requirements from banks (RFF Report,
2017).

Human Resources
Secondly, related to human resources there is a reported shortage of skills and talent. 28% of
the social enterprises say they lack technical skills, while 20% claim there are insufficient
managerial skills. Furthermore, 20% of the firms report that difficulties in recruiting new
personnel is a barrier to growth (RFF Report, 2017). This view was confirmed in an interview
with Ana Tan, director of Ataneo university Centre for Social Entrepreneurship (ACSENT) as
she stated there is a lack of skills and courage among many social entrepreneurs. The problem
of holding onto employees was also identified, as many seek new opportunities after a few
years of involvement. Interestingly, but perhaps not surprising, Ana linked the problem of
accessing finance to the relatively low level of skills among entrepreneurs and other employees.
Although there are funds available, the process of matching an investor or lender with a social
enterprise often becomes more difficult due to the shortfall in necessary skills.

Policy Environment
Thirdly, the policy environment dictated by the Government poses several challenges for social
enterprises in the Philippines. In the report, 20% mention government policies as barriers to
growth. Furthermore, 25% say taxation is a significant hurdle while another 15% state that
government regulations and red tape hinders possibilities to scale up their operations. As
concluded in the RFF report (2017), there is a pressing need for the government to formally
recognise social enterprises and their business activities that so actively contribute to economic
inclusion and social cohesion in the country. This is in line with the view of Poon (2011), who
argues that the political and legal environment play a crucial role in providing opportunities
and support for social enterprises

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Appendix 2 – Ecosystem Actors
Incubators & Accelerators
These are actors focus on giving early-stage social enterprises support regarding business
advice, equipment, network and space to work. The main difference between incubators and
accelerators are the stages in which their services intend to support the enterprises as well as
the timeframe of their support (Pauwels et al. 2016). Accelerators tend to focus on early start-
ups during a short period whereas incubators tend to have longer time frames. In the
Philippines, there are several of organisations offering incubation and acceleration, which of
the majority located in Manila (RFF Report, 2017).

Social Investors
Under the genre of social investors in the Philippines, there are two types of investors namely
impact investors and social investors. Impact investing like conventional investing involves the
lending of financial resources for a financial return (Global Impact Investing Network, 2017).
However, the return is not the sole objective; instead, the goal is to strike a balance between
social impact and financial return. Social investments are similar, but the focus tends to be
more on the social impact, and financial returns should only cover inflation rather than
generating commercial returns (Ashta, 2012).

Non-profits & NGOs

NGOs and non-profits are devoted to supporting the promotion of the population in the
Philippines. Regarding fighting poverty and inequality, they are critical actors for social
enterprises as they provide information, knowledge, and support (RFF Report, 2017).

Business/Industry associations
Within an ecosystem or support environment, business/industry associations should be
designed to promote local sustainable economic activities through different programs and
services. They can also play an important role when it comes to shaping the policy of the social
enterprise sector (RFF Report, 2017).

Educational Institution
The goal of entrepreneurship education is to prepare students with the fundamental knowledge
needed to develop new businesses or grow existing ones (Tracey & Philips, 2007). In the
context of social entrepreneurship education, an institution should teach students to combine
social and commercial objectives. In the Philippines today there are multiple educational
institutions offering students the fundamental knowledge of social entrepreneurship (RFF
Report, 2017).

Research and Support Organisations

These institutions are essential actors in both providing social entrepreneurs with education and
training but also providing both practical and theoretical information that helps to develop the
sector as a whole in the Philippines.

Forums and Networks

In the Philippines these actors are helping to build capacity through different types of services
such as consulting, business development or assistance in financing, they also help to connect
social enterprises with financial resources. Many of these actors are very important for the
growth of the sectors because of their strong support to initiatives aimed at poverty reduction
(RFF Report, 2017).

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Government Institutions
The role of the government is to provide social entrepreneurs with a favourable environment
that supports the growth of social enterprises (Shockely & Frank, 2011). However, to create
such a situation there is a need for specific policies to be in place, which has been a significant
challenge of the development of the sector in the Philippines.

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Appendix 3 – PRESENT Bill

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Appendix 4 – Topic Guide Entrepreneurs
Table 8 Topic guide social entrepreneurs

Topic Questions
Formalities 1. Introducing ourselves

2. Ask for permission to record the interview

Introduction of topic:
3. Our definition of the Ecosystems and NewGen SE here in the Philippines
Social Enterprise 1. Please tell us about your social enterprise, how did you come up with the idea
of starting your social enterprise?

1. If not answered: what was your personal motivation?

2. How is your business helping in solving the social issue of ….

2. If not answered: How do you measure this impact?

3. How have you financed your business activities? (dependent on the stages of
the venture – start-up, growth, maturity)

3. How has it changed over time? Or How will it change in the future?

Ecosystem 1. What is your current understanding of the ecosystem?

2. Could you tell us about a time, in the past or the present, when you received
support from the ecosystem that helped you develop your business?

● If not answered: Was this the only support you have received? or have
you received support multiple times?
● How did it happen, who approached who?

3. How have these actors helped you in reaching your social mission &
financial mission
Challenges 1. Could you tell us about a time, in the past or present, when have you faced a
challenge that hindered you in the development of your business?

● Has this been your main challenge? Have there been others?
● What are your current challenges?
2. If you could wish, what support from the ecosystem do you need in order to
overcome these challenges?
Opportunities 1. If it was up to you to design the support environment to better help you in
growing/developing your business and other NewGen SE, how would you do
it?

2. Are you aware of the PRESENT Bill?

● How do see this influencing your business

3. How do you see the general sector of social enterprises evolve in the future
here in the Philippines?

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Appendix 5 – Topic Guide Ecosystem Actors
Table 9 Topic guide ecosystem actors

Topic Questions
Formalities 1. Introducing ourselves

2. Ask for permission to record the interview

Introduction of topic:
3. Our definition of the Ecosystems here in the Philippines as well as
introducing the concept of new generation social enterprises.
Social Enterprise 2. How do you perceive the new generation social enterprises to be?

● If not answered: what makes them different from other types of social
enterprises in your opinion?

1. Please tell us about your organisations role in the social enterprise ecosystem,
how did it start?
Ecosystem 1. What is your current understanding of the ecosystem?

2. Could you tell us about a case when your organisation have helped NewGen
SE to develop and grow?

● How is your organisation assisting NewGen SE to achieve their social

mission?
o If not answered: How do you ensure that impact is being
made?
● How do you assist NewGen SE in achieving financial sustainability?
3. How does the collaboration with NewGen SE work?

4. What other actors within the ecosystem are you collaborating with to enhance
the support for NewGen SE?

o if not answered: How does this collaboration work?

Challenges 1. In your opinion, what is the most difficult challenge NewGen SE is facing
that hinders growth?

2. What are the main challenge for you as an organisation when assisting or
collaborating with NewGen SE?

● What would be your advice to overcome these challenges?

○ If not answered: How would you change processes in your
organisation or collaboration with entrepreneurs?
Opportunities 1. If it was up to you, how would you design the ecosystem to better support
NewGen SE to develop and grow?

2. Are you aware of the PRESENT Bill?

● How do see this influencing the future of SE Enterprises

3. How do you see the general sector of social enterprises evolve in the future
here in the Philippines?

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 Appendix 6 – 2nd Level Codes

Figure 7 2nd level codes

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Appendix 7 – Informed Consent
Consent for participation in a research interview
New Generation Social Enterprises and the Surrounding Ecosystem in the Philippines
Funded by: SIDA – Swedish International Development Cooperation Agency,
Contact Person in the Philippines: Dr. Lisa Marie Dacanay (ISEA)

I agree to participate in a Master Thesis project led by two students Axel Lundberg and
Jonathan Lennstrom Nystrom from Jönköping International Business School, Sweden. The
purpose of this document is to specify the terms of my participation in the project through being
interviewed.

1. I have been given sufficient information about this research project. The purpose of my
participation as an interviewee in this project has been explained to me and is clear.

2. My participation as an interviewee in this project is voluntary. There is no explicit or implicit

coercion whatsoever to participate.

3. Participation involves being interviewed by researchers from Jönköping International

Business School. The interview will last approximately up to 1 hour. I allow the researchers to
take written notes during the interview. I also allow the recording by audio tape of the
interview. It is clear to me that in case I do not want the interview to be taped I am at any point
of time fully entitled to withdraw from participation.

4. I have the right not to answer any of the questions. If I feel uncomfortable in any way during
the interview session, I have the right to withdraw from the interview whenever I want.

5. I have been given the explicit guarantees that, if I wish so, the researcher will not identify
me by name or function in any reports using information obtained from this interview, and that
my confidentiality as a participant in this study will remain secure.

6. I have been given the guarantee that this research project has been reviewed and approved
by supervisors and teachers at Jönköping International Business School

7. I have read and understood the points and statements of this form. I have had all my questions
answered to my satisfaction, and I voluntarily agree to participate in this study

8. I have been given a copy of this consent form co-signed by the interviewer.

____________________________ ________________________
Participant’s Signature Date
____________________________ ________________________
Researcher’s Signature Date
____________________________ ________________________
Researcher’s Signature Date
For further information after the interview please do not hesitate to contact us at any time:
[email protected]/[email protected]

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Appendix 8 – Proposal Letter

Dear ….

Our names are Axel and Jonathan, two master-level business students from Jönköping
University in Sweden. This letter is endorsed by the Dr. Lisa Dacanay and the Institute of Social
Entrepreneurship in Asia (ISEA). We were recommended by them to contact you in order to
conduct our research study on the topic of Social Entrepreneurship in the Philippines.

Our research will focus on “New Generation Social Enterprises” in the Philippines, or in other
words; Social Enterprises led by the youth. We will look at the main features of the ecosystem
that supports the development of new generation social enterprises. By ecosystem, we refer to
supporting actors such as Government, Universities, private institutions, investors and
incubators. The aim of the study is to see how the ecosystem can better support and develop
new generation social entrepreneurs who are addressing challenges in society such as poverty
and inequality.

We are contacting _________ because ______ and it would be very interesting to hear your
views on _______.

The focus of our master program at Jönköping University is “Strategic Entrepreneurship”, and
during this time we have specifically developed a passionate interest for social
entrepreneurship. We are excited about the possibilities and opportunities within this field,
especially in a developing country setting where social enterprises have the potential to make
a big difference in addressing social challenges. We received a scholarship from SIDA,
Sweden’s International Development Cooperation Agency, in order to collect data for our
master thesis during a 2-month period in the Philippines. We are based in Manila and will be
here between the 7th of February and 6th of April.

We write you to respectfully inquire about your availability to participate in an interview for
above mentioned research purpose. Your time would be much appreciated and we would be
grateful for any assistance you might be able to provide us. The length of the interview will be
approximately 1 hour, and confidentiality is of course kept upon request. In terms of
geographical location we are very flexible, interviews can be done either at ISEA’s office at
Ataneo University in Manila or at a location of your choice.

Thank you so much for you time - any help is greatly appreciated. We look forward to hear
back from you, either by email or phone. Please see contact details below

Contact details:
Email: [email protected] / [email protected]
Phone (whatsapp): +46739960273 / +46731570854
Phone (local number): +639560070468 / +63956 0070469
Best regards,
Axel Lundberg & Jonathan Nyström Lennström

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