Smart money for social ventures: An analysis of the value-adding activities of philanthropic venture capitalists
Publication typeJournal article with impact factor
JournalVenture Capital: An International Journal of Entrepreneurial Finance
Publication Begin page349
Publication End page378
MetadataShow full item record
AbstractPhilanthropic venture capitalists (PhVCs) provide social entrepreneurs with financial and nonfinancial resources. This paper studies how and why PhVCs engage in value-adding activities. Employing an inductive case study method, our study shows that value-adding activities engaged in by PhVCs are similar to the activities carried out by traditional venture capitalists. Further, we find self-efficacy and goal setting theories to be particularly relevant in studying why PhVCs engage in value-adding activities. Concretely, PhVCs engage in value-adding activities that are in line with their efficacy beliefs and that facilitate the achievement of lower-order goals related to professionalization, self-sustainability, and expansion. As such, they aim at reaching the higher-end goal of scaling the social venture.