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Nonprofit organizations (NPO) have suffered from two interrelated bottlenecks: lack of funds and difficulties to grow and operate at scale. Business model innovation (BMI) has been found to be important to overcome those bottlenecks, but the extant literature is limited and lacks a solid empirical foundation. To explore this topic, we conducted a retrospective analysis of a single case study, tracking the evolution of an organization's business model as it went from being a traditional, donation-based NPO, to a dynamic sales-driven social enterprise (SE). As a result, the organization gained financial autonomy, scaled up operations and increased impact. Our findings add to the literature by identifying BMI change drivers and outcomes. We show how a platform-inspired business model can enhance value creation and value capture in a SE.

PurposeThe purpose of this study is to identify how the value dynamics of the freemium business model (BM) play out in a social enterprise.Design/methodology/approachWe draw on a multiple case study of two social enterprises –one nonprofit (Aravind Eyecare) in Asia and one for-profit in Latin America (Biodent)– to analyze the implications of applying the value architecture of a freemium BM to social enterprises.FindingsThe freemium BM departs from standard practice when applied in social enterprises. Meaningful differences include the feasibility/desirability of converting free users to paying ones, the presence of significant variable costs –which requires balancing the ratio of free and paying customers– and the use of nontraditional pricing schemes to enhance value capture. The social freemium BM can increase scalability, value creation and value capture. Under this model, “beneficiaries” can be more than passive recipients of value and contribute to a venture's success in various ways –such as lowering its operational costs or enhancing its value proposition toward third parties.Originality/valueWhile in the past years commercial enterprises have been disrupted by the emergence of freemium platforms, the social enterprise field has barely taken notice. We extract lessons and implications from this paradigmatic change for the theory and practice of business model innovation in social enterprises, of particular relevance to Latin America, where social and environmental disequilibria remain a recurring feat.

Does responsible leadership matter when assembling an inclusive supply chain at the Base-of-the-Pyramid (BOP)? Current literature implicitly assumes that it does not. BOP scholars initially focused on the importance of shaping innovative and disruptive offerings, with radically improved price–performance ratios. Subsequent studies tended to focus on barriers to implementation of large-scale ventures at the BOP. Their common characteristic was the fact that the attributes and roles of the individuals involved were deemed unimportant. If the opportunity was there, provided barriers were removed and the right value proposition was offered, the inclusive venture should take off. We evaluate three cases of leaders who succeeded in building inclusive ventures at the BOP, in contexts marked by institutional voids—where formal markets were weakly structured or nonexistent. Building a viable business under those circumstances entailed two tasks: imagining what is possible and then turning that vision into a reality. We found that, in carrying out those tasks, individuals do matter. Sampled cases show that working with nontraditional partners in inclusive supply chains requires more than aligning material incentives. Our analysis suggests that responsible leadership (RL) with a strong ethical foundation can provide powerful leverage to ensure buy-in and commitment from the various actors involved. We show how RL can impact organizations and external stakeholders through positive upward spirals. Our analysis contributes to the literature on BOP and RL by confirming, extending, and challenging existing knowledge. We propose two novel attributes (catalyst and social innovator) and argue that context matters, influencing how RL is operationalized and defined. Understanding the critical role of RL in the construction of inclusive supply chains adds a critical missing link that sheds light into the micro level of new business creation, development, and consolidation at the BOP.

Purpose The purpose of this paper is to explore the extent to which hope and perceived goal attainment can be developed in subsistence entrepreneurs through the right training tools. Design/methodology/approach A longitudinal study of a subsistence entrepreneurship training program in three Central American countries was carried out. Participants were divided on the basis of their exposure to training (yes, no), and of the type of training received (none, business plan, business model). The authors carried out three assessments (just before the program, six months and one year after the program) of participants’ business goals and their hope of attaining them. Information was analyzed using linear regression. Findings Participants exposed to training reported significant increases in perceived goal attainment and in their hope levels. Training based on the business plan affected hope agency in the short term, as predicted by the logic of causation theory. Training based on the business canvas affected hope pathways, as predicted by the logic of effectuation theory. Research limitations/implications Given the data collection process (a non-random sample and selection of participants), the findings are not generalizable without stringent procedures and further replication. Practical implications If hope is a reliable predictor of goal attainment, it should be promoted and measured. Given the limited means of gathering data and making reliable projections that most entrepreneurs endure, the business canvas’ contribution to entrepreneurs’ “emotional equipment” ceteris paribus should be more valuable for subsistence entrepreneurs. Originality/value This is the first study comparing the short- and long-term effects of two entrepreneurial learning devices on entrepreneurs’ hope and business goal attainment.

The purpose of this article is to advance research on sustainable innovation through a business model (hereafter, BM) perspective. We consider the BM as a boundary-spanning system that encompasses various firms, in which value is created, exchanged and captured. More specifically, we look at the changes called for by the imperative of sustainable development, through the perspective of the BM. When companies coalesce around well-entrenched BMs, sunk costs and lock-in effects emerge as formidable barriers for sustainable innovation. We posit that the multiple dimensions in which sustainable innovation creates value for BM participants have not been adequately studied. In this article, we seek to address that gap by exploring the following research questions: What mechanisms enable transactions in boundary-spanning BMs that seek to bring about sustainable innovation? Are there synergies or otherwise meaningful connections between the different collaboration mechanisms? Are there enabling mechanisms that may facilitate or hinder those mechanisms? We look at the BM of three green innovators: new entrants that created a niche in their industries with clear social and environmental advantages over imperfect substitutes. Our main contributions to the literature on sustainable innovation are: (1) the integration of social and environmental collaboration mechanisms in addition to the economic ones used by extant studies; (2) the identification of the connections among these social, economic and environmental collaboration mechanisms; and (3) the identification of a set of enabling conditions within the focal firms that facilitate collaboration at the BM level. We close with propositions about enabling conditions, collaboration mechanisms and outcomes (sustainable innovations).

In our research, we examine the efforts made by Latin American business schools in the last decade to deliver a value-based education. We carry out a survey with a sample of faculty members and program directors from the whole region. We find that societal demands influenced the direction of managerial education toward values and social responsibility, changing contents and teaching methodologies in the process. Our research shows that the teaching of value-based contents—social responsibility, business ethics and environmental sustainability—has gained ground in the region in the last decade, and that the emphasis on value-based contents goes hand-in-hand with a more intensive use of active learning methodologies—the case method in particular. From the perspective of respondents, the emphasis on active learning seems to correlate positively with observed changes in students’ civility.

Successful cases of base of the pyramid (BoP) ventures in large corporations remain hard to find. The BoP literature has identified external and (to a lesser extent) internal barriers to implementation. However, this literature has treated barriers as isolated and discrete elements, overlooking the fact that most often those are integrated as part of the organization’s business model. In fact, the challenge of implementing a BoP venture within the umbrella of a large corporation can be framed as a challenge to achieve organizational ambidexterity. We apply that frame to the study of a critical incident, a “most likely” case where 12 large corporations received every incentive to implement BoP ventures, yet only 3 survived. We looked at both failures and success cases, and extract lessons from them. Our findings go against the grain of some prescriptions of mainstream BoP literature and the practice of funding agencies. We finish with recommendations for policy.

Management of different types of partnerships plays a decisive role in company performance. Complex business ventures, such as those created to serve low-income populations, usually include both cross- and same-sector partnerships. However, the initial diversity featured in these alliance portfolios diminishes as companies take their ventures up to scale. This article develops theoretical propositions about the evolution and configuration patterns of portfolios that include both cross- and same-sector partnerships. Two longitudinal case studies serve to illustrate the theoretical framework developed for alliance portfolios that include both types of partnerships. Companies that create such portfolios adopt partnership strategies that follow paths also identified in the evolution of portfolios only made up of partnerships with other private firms: i.e., an evolution from adapting to shaping and exploiting strategies.