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Abstract

Social Entrepreneurs address ‘wicked’ societal problems and achieve social impact using innovative practices. This study contributes to the analysis of the role of government in the ecosystem of Dutch social entrepreneurs by looking at the support initiatives that the Amsterdam municipality offers. Our paper reveals how municipal officials and social entrepreneurs position themselves in this ecosystem and how they make sense of their collaboration. We think that these issues are important to dwell on to be able see the limits of collaborative governance approaches in the Dutch Social Entrepreneurship eco-system. The results of qualitative interviews conducted with municipality officials, social entrepreneurs and members of network organizations show that the ties between the municipality of Amsterdam and social entrepreneurs are not strong enough to overcome the institutional barriers and that the relationship between them is disrupted by the different logics used. Social entrepreneurs operate from both a social as well as a commercial logic. Social entrepreneurs see themselves as running noble social enterprises that put impact first, but the municipality values a commercial logic when granting subsidies. This means that the social enterprises do not always fit within the frameworks offered by the municipality because their commercial logic is seen as less legitimate when it comes to support. The results of this study confirm that in the governance of wicked problems, there is an ongoing actor positioning process where, in this case, social enterprises and municipalities, hold on to their actor-based understanding of the nature of issues and collaboration.

Keywords

Social entrepreneurship wicked problems local governance hybridity social entrepreneurship eco-systems social innovators social nurturers

Introduction

The term ‘social entrepreneurship ecosystem’ has crept into the lexicon of policymakers over the past decade (Roy and Hazenberg, 2019). The conceptualization of social entrepreneurship introduced by Mair and Marti (2006) has played an important role in the advancement of research into the definition of social entrepreneurship (Kimmitt and Muñoz, 2018). In the view of Mair and Marti (2006, p. 37), social entrepreneurship can be seen as a process in which resources are used and combined in innovative ways to pursue opportunities that catalyze social change and/or address social needs. Social entrepreneurship differs from conventional entrepreneurship in its primary mission, as it is not about generating private economic profits or shareholder value (Austin et al., 2006; Gupta et al., 2020; Kimmitt and Muñoz, 2018; Mair et al, 2012).

The social problems that social entrepreneurs try to address often result from ‘wicked’ problems such as poverty, lack of water and sanitation, issues associated with gender empowerment and inequality, and climate change (Westley et al., 2011; Guo and Bielefeld, 2014). Literature suggests that these problems are “wicked” in nature mainly because of the fact that they “have no closed-form definition, emerge from complex systems in which cause and effect relationships are either unknown or highly uncertain, and have multiple stakeholders with strongly held and conflicting values related to the problem” (Dentoni et al., 2016: p. 36). Social entrepreneurs, being predominantly motivated by a social purpose, are often perceived as being trustworthy providers of public services making the collaboration between social enterprises and government bodies possible. In line with this, we see that in many places around world, social entrepreneurship policy is translated into programs that focus on strengthening an ecosystem in which social entrepreneurship can flourish (Bosma et al., 2019). Municipalities, local authorities and local communities facilitate social entrepreneurs and social initiatives through the provision of land, facilities, financial support or professional skills (Onyx and Leonard, 2010). Korosec and Berman (2006) argue that there are several ways in which municipal government managers can support the efforts of social entrepreneurs to develop new programs. These include raising awareness, helping social entrepreneurs to acquire resources (including direct municipal support), and coordinating efforts among social entrepreneurs and others in program implementation. In the Dutch context too, we see that municipalities are highly interested to collaborate with social entrepreneurs. In 2015, in the Netherlands, Amsterdam was the first municipality with a Social Entrepreneurship Action Programme. Many activities are now being organized under the name Amsterdam Impact in collaboration with Impact Hub Amsterdam (Social Enterprise NL, 2018). The aim of Amsterdam Impact is to support the development of social entrepreneurship in Amsterdam and to position the city internationally as a prime location for impact-driven companies (Amsterdam Municipality, 2019a). Various policy programs have been developed by the municipality that focus on strengthening, stimulating and facilitating the impact economy and the associated ecosystem (Amsterdam Municipality, 2019a). To help social enterprises grow, incubation programs and challenges for entrepreneurs are also being developed in consultation with network organizations (Amsterdam Municipality, 2019a). The municipality is also working on new models of public-private partnerships to realize an effective ecosystem for impact (Amsterdam Municipality, 2019b). According to the Amsterdam Municipality (2019b), this collaboration facilitates critical conversations between policymakers and entrepreneurs in order to understand each other's needs and promote the relationship.

In this paper, using social network theory and stakeholder theory we will try to map the relational structure between the social entrepreneurs and the government. To date, little research has been done on the relationship between local authorities and social entrepreneurs (Hogenstijn et al., 2018). However, various surveys, including one by Social Enterprise NL, have shown that social entrepreneurs in the Netherlands characterize the relationship with the municipality as far from optimal (Hogenstijn et al., 2018). The authors of this paper believe, just like Head and Alford (2015), that the challenges associated with tackling wicked problems in the public sector are due not only to the inherent complexity of the problems but also to the tendency of public sector policies and procedures to constrain the locus of potential solutions. Cross sector partnerships are much praised in their potential to address wicked problems, but one has to also realize that these partnerships ‘include actors that have fundamentally different core logics, operating principles and goals’ (Dentoni et al., 2016: p. 37).

Informed by these debates; focusing on the support initiatives for social entrepreneurs, we would like to understand how initiatives in question contribute to the ecosystem of social entrepreneurs. We also would like to reveal how actors position themselves in this ecosystem and how they make sense of their collaboration. We think that these issues are important to dwell on to see the limits of collaborative governance approaches in the Dutch Social Entrepreneurship eco-system.

Theoretical framework

Social entrepreneurship is often studied through the lens of stakeholder theory, as social enterprises are generally considered to be organizations in which stakeholders play a major role (Burga and Rezania, 2016; Low, 2006). This is a consequence of the fact that many social entrepreneurs – unlike conventional entrepreneurs – depend on external stakeholders who share funding and information for the benefit of the enterprise’s social mission (Lumpkin et al., 2013; Gupta et al., 2020). A wide diversity of stakeholders can help social entrepreneurs to optimize both the continuity of their business and the financial performance (Bozhikin et al., 2019). A stakeholder can be defined as any individual or group that is affected by or exerts influence on an organization's ability to achieve its objectives (Freeman, 1984). In addition, Freeman (1984) emphasizes that organizations can only be sustainable if they satisfy their (legitimate) stakeholders. Stakeholder theory has ensured that a shift has taken place within organizations in which stakeholder value has become more important than shareholder value.

When looking at organizations from this perspective, the external environment is seen as a driving force acting on the organization, where stakeholders give some form of approval with regards to the actions of the organization (Low, 2006). Stakeholders can thus be defined by Mitchell et al. (1997) by the following characteristics: power, legitimacy, and urgency (Mitchell et al., 1997). Power as a characteristic determines the influence a stakeholder has over the organization. Urgency can be seen as the importance of time that the stakeholder claims over an enterprise. Legitimacy as a characteristic impacts the stakeholder's claim to the attention of the organization (Burga and Rezania, 2016). When a stakeholder possesses this combination of characteristics, it is salient for the organization concerned (Lumpkin et al., 2013).

Social enterprises generally do not have one dominant stakeholder; which means that different stakeholders have multiple conflicting expectations and needs (Crucke and Decramer, 2016; Dacin et al., 2010). The stakeholders of social enterprises come from different sectors: the commercial, public, and social welfare sector (Pache and Chowdhury, 2012). When attracting stakeholders, social entrepreneurs constantly seek a balance between different institutional worlds, therefore they must be able to bridge different institutional logics (Doherty et al., 2014; Karré, 2018; Pache and Chowdhury, 2012; Schultz et al., 2013; Smeets, 2017).

Cots (2011) indicates that a network perspective can help in understanding stakeholder relationships, because it provides insight into how a particular stakeholder group interacts with the organization. According to Aldrich and Zimmer (1986), entrepreneurs often find themselves in social network structures. Networks are essential for the social entrepreneur because they provide access to information and advice (Casson and Giusta, 2007; Hoang and Antoncic, 2001). Given the importance of information for the entrepreneur, it is not surprising that networks are of great importance for the entrepreneurial activities and identifying business opportunities (Casson and Giusta, 2007). What is remarkable about the networks that arise between social entrepreneurs and their relationships is that the closest and strongest connections are often within the local environment (Dacin et al., 2010; Schutjens and Völker, 2010).

The ecosystem as a supportive environment

The concept of an entrepreneurship ecosystem first emerges in the work of Spilling (1996), where he refers to it as “entrepreneurship system”. It can be deduced from the article that the concept for Spilling (1996, p. 91.) consists of “a complexity and diversity of actors, roles and environmental factors, which together determine the business performance of a region or place”. The concept of entrepreneurship ecosystem does not yet have a common definition (Stam, 2015). According to Malecki (2018), this is due to the different ways in which the concept is interpreted and examined. After all, the concept is being examined on different scales and through different research designs. There are common elements in the various definitions that exist of entrepreneurship ecosystems: a supportive culture, a self-regulating network of mutual dependent actors, a shared pool of resources within the region and investors in capital (Isenberg, 2014; Gauthier et al., 2017; Stam, 2015; Spigel, 2017; Vedula and Kim, 2019).

Isenberg (2010) argues that an entrepreneurship ecosystem consists of elements that relate to each other in very complex ways and that these different elements must be there so that the ecosystem can keep itself in balance. The combinations of these different elements are always unique, but the following six domains are required for flourishing entrepreneurship: policy, markets, capital, people skills, culture and support (Isenberg, 2010). Spigel (2017) also mentions this and sees entrepreneurship ecosystems as “interacting social, political, economic and cultural elements within” a region that supports the development and growth of innovative start-ups (Spigel, 2017: p. 50). The entrepreneur can be seen as the central heart of every entrepreneurship ecosystem. Its main objective is to create economic impact. For social entrepreneurs, however, social value creation and social impact are of paramount importance in addition to economic impact (Villegas-Mateos and Vazquez-Maguirre, 2020).

Although conventional entrepreneurs and social entrepreneurs have different forms of impact, Roundy (2017) argues that social entrepreneurs are likely to be influenced by many of the same factors in entrepreneurship ecosystems. Biggeri et al. (2017) also state that it is important for social entrepreneurs, just as it is for conventional enterprises, that there are resources at the local level that promote the development of the enterprise. There are also specific characteristics that ensure a functioning ecosystem for social entrepreneurs. A favorable ecosystem for social entrepreneurs includes a diversity of resource providers, sufficient support organizations and a culture that provides the opportunity for entrepreneurial learning (Roundy, 2014). To achieve more entrepreneurship and growth within the entrepreneurship ecosystem, Spigel (2017) identifies three regional resources that are important for this. First, a shared cultural understanding and an institutional environment is needed. Second, social networks within regions create opportunities for knowledge transfer between companies, universities, and financiers. Finally, government policy can also support these networks by removing institutional barriers for entrepreneurs.

The government as a stakeholder in the ecosystem of social entrepreneurs

According to Dees (2007), the government needs social entrepreneurs because they have a number of clear advantages compared to government agencies. Dees argues that they have more freedom of action and can explore a wider range of alternatives, mainly because they are not limited by bureaucratic rules, legislative mandates, political considerations and a fixed budget (Dees, 2007: p. 3). In addition, independent social entrepreneurs have access to private resources from their network, while private contributions to the government are relatively rare. Governments can provide innovative solutions and support the development of regional and local economies (Cagarman et al., 2020).

In essence, it can be said that social entrepreneurs and the government share the same goal: the pursuit of solving social problems, but in order to achieve this they use different types of logic (Doherty et al., 2014; Karré, 2012; Pache and Chowdhury, 2012; Schultz et al., 2013; Smeets, 2017; Tracey et al., 2011). According to Defourny and Nyssens (2021) government policy is often criticized. Critics suggest that the goals of the government are often formulated in such a way that there is a risk that social enterprises become reduced to mere tools to achieve specific goals that are prioritized on the political agenda. On the other hand, government support can help social entrepreneurs. Jung et al. (2016) state that government support benefits social entrepreneurs in two ways: it empowers them to serve communities and to help them overcome financial barriers. Kim et al. (2014) state that governments can give social enterprises the best support by using an ecosystem-oriented approach, in which the social enterprise is itself in control and is not only dependent on direct financial support from the government. Although legal limits and regulations for social entrepreneurship are usually made at the national level, relationships with government at the local level are most important for social companies (Hogenstijn et al., 2018). In a study into the role of the government in promoting social entrepreneurship, Sullivan (2007) reported that government support provided by cities promotes social entrepreneurship within the community to a great extent.

Ecosystem models often focus on entrepreneurial issues, such as legal frameworks, business development, social impact measurements, networking and other support structures (Andersen et al., 2021). Because all stakeholders jointly influence the entire system, Bozhikin et al. (2019) state that the government should focus their policies on all the most important players within the ecosystem as well as on social enterprises. Defourny and Nyssens (2021) also assert that the support measures that exist within the entrepreneurial ecosystems, such as, hubs, accelerator programs and impact investments, often target only a subset of social enterprises. They prefer a broader approach, in which various entrepreneurial mechanisms are developed to support the ecosystem.

Amidst all these scholarly debates, Wurth et al. (2021) point out that the few empirical studies in the field mean that we still do not know exactly how and to what extent programs that serve to improve entrepreneurship ecosystems are efficient and helping social entrepreneurs.

Methods

This research examines how initiatives from the municipality contribute to the ecosystem of social entrepreneurs in Amsterdam and how these programs are experienced by social enterprises in the hope that we get a better conceptualization of the governance of wicked problems. We chose an interpretive qualitative research method, because this form of research focuses on how social experiences are created and given meaning (Rynes and Gephart, 2004). This research is based on the constructivist assumption that the organizational world is socially constructed and consists of multiple realities (Creswell, 2014).

The research population of this study consists of 18 social entrepreneurs working in the municipality of Amsterdam, 2 officials of the municipality of Amsterdam and 2 people from network organizations that actively collaborate with social entrepreneurs as well as with the municipality. Using purposive sampling we approached social entrepreneurs that were working in Amsterdam. We found our respondents through the websites of Social Enterprise NL and the municipality of Amsterdam. In addition, snowball sampling was used. A total of 90 social enterprises were approached by phone or email to participate in the investigation. Of these, there were ultimately 18 respondents who agreed and subsequently participated. A possible explanation for this low turnout could be the COVID-19 crisis during which this research took place. The respondents who were recruited were mostly the founders of the enterprises, but in some cases it was the employees. Out of 18 respondents, 10 could be classified as social innovators who were working in the production and innovation of sustainable products with a goal of enhancing circular economy, the other eight could be classified as social nurturers with focus on job participation.

As for the municipality officials, the criterion set was that the respondent is actively involved in supporting social entrepreneurs. Early in the research it was found out that within the municipality there are only two organizations that are directly involved in supporting social entrepreneurs. These are Sociaal Werkkoepel and Amsterdam Impact. Sociaal Werkkoepel falls under Social Affairs, and Amsterdam Impact under Economic Affairs. We interviewed one official from each organization out of 10 employees combined in these two departments. There are many more departments within the municipality dealing with social enterprises, but the employees of these departments did not have direct contact with support programs so we did not approach them.

It was decided later on in the research to include another group since our pilot interviews revealed the importance of network organizations for social entrepreneurs. The network organizations interviewed for this study see it as their task to improve the social enterprise ecosystem and see social entrepreneurs as pioneers in the transition to a new kind of economy. The role that network organizations play can be interpreted as representatives of social entrepreneurs. They understand the importance of knowledge and information provision to their target group and provide services such as organizing meetings, setting up accelerator programs and offering legal assistance in exchange for a member or partnership. In the entrepreneurship ecosystem, they therefore fulfill different functions and are therefore not only essential as stakeholders for the social entrepreneur, but also for other parties in the ecosystem. In addition, insight from a third party contributes to better establishing relationship between social entrepreneurs and the government. For sample selection, purposive sampling was used and the network organizations that appeared most frequently in the interviews by the social entrepreneurs were approached A total of four network organizations were approached, two of which agreed. These were Social Enterprise NL and Impact Hub Amsterdam.

In total, the number of respondents for the semi-structured interviews was 22 people including municipality officials (2) and network organization officials (2). The interviews were conducted between February 19 to March 31, 2021 and have an average duration of 45 min. Due to the measures taken during the COVID-19 crisis, most of the interviews had to be conducted virtually via ZOOM and Microsoft Teams.

Semi-structured interviews were chosen to obtain both retrospective and real-time accounts of the people experiencing the phenomenon of theoretical interest (Gioia et al., 2013). For the semi-structured interviews, a topic list was used to guide the data collection process. Three different topic lists have been chosen because the respondents from the different sub-units have to be asked different questions in order to answer the main question. The topic lists used for the interviews are all based on the same overarching concepts and questions were then formulated for each sub-unit. The concepts that were leading in the interviews are: Social entrepreneurship, climate and ecosystem of social entrepreneurs in Amsterdam, stakeholders and social network, relationship with the municipality of Amsterdam, support programs for social entrepreneurship and finally the general role that the government can play in stimulating social entrepreneurship.

The software program Atlas. Ti was used to analyze the qualitative data because the use of computer-aided qualitative data analysis makes it possible to analyze the data systematically, comprehensively and completely (Rynes and Gephart, 2004). Before the interviews were coded and analyzed in Atlas. ti, they were transcribed verbatim. A fixed procedure was used to analyze the data, which aims to increase the qualitative rigor of the inductive reasoning process (Gioia et al., 2013). In the data analysis, building on the work of Gioia et al. (2013), both inductive and deductive analysis techniques were used. In addition, the researchers have taken seceral ethical issues into consideration; the anonymity of the respondents is ensured in this study by not mentioning the names or functional characteristics of the respondents; yet still making it clear to which sub-unit the respondent belongs. Participation in the study was completely voluntary and no compensation was provided. An informed consent has been sent out in which the privacy, confidentiality and anonymity of the respondent is guaranteed. The respondent also had the option to withdraw from the study at any time.

A note on the typology of social enterprises

To understand the relationship between social entrepreneurs and the municipality, it is important to recognize that there are different types of social entrepreneurs and that a social enterprise can focus on different impact areas for their social mission. The data of the research have made it clear that different types of social entrepreneurs use different ways of contacting the municipality. Different types of entrepreneurs are also entitled to different support initiatives. To map these differences, the typology of Dagevos et al. (2015) was used, which classifies social entrepreneurs based on their impact area. Impact classifications are a commonly used classification for social enterprises (Hogenstijn, 2018). The typology of Dagevos et al. (2015) was deliberately chosen because it was specifically developed for the Dutch context. Dagevos et al. (2015) distinguish the following four groups in their typology:

(1) Social nurturers focus on labor participation and ensure that people with a distance to the labor market gain access to work or daytime activities.

(2) Social traders are committed to development cooperation and adopt a position as an intermediary between the target group and the market.

(3) Social connectors focus on quality of life and well-being and connecting people comes first.

(4) Social innovators fully focus on sustainability in their social mission and offer sustainable alternatives to existing activities and/or services.

Although this typology gives a good impression of the impact areas that Dutch social enterprises focus on, Backer (2019) mentions that the social mission of entrepreneurs often spans multiple impact areas. When a closer look is taken on the basis of this typology to the respondent group of this survey, it is striking that a third of the entrepreneurs combine several impact areas equally in their social mission. An example of this is an organization that actively focuses on sustainability as well as on labor participation. In the presentation of the results of this research, social traders and social connectors will not be discussed as a separate group, because the number of respondents in the sample was not large enough to draw conclusions. Social innovators and social nurturers on the other hand will be discussed separately, because clear differences between these groups can be recognized in the relationship, but also in the support they receive as a group from the municipality of Amsterdam.

Research findings

Our findings can be better conceptualized under two main headings. In the first one we present the major needs of social entrepreneurs of the municipality as they were conveyed to us through the interviews. In the second, we present our findings that focus on the relation between the two major actors in question and their perspectives of each other.

Needs of social entrepreneurs in the entrepreneurship ecosystem

In conversations with the social entrepreneurs it emerged that the largest support needs exist in the areas of knowledge, financing, procurement and tender processes, and the entrepreneur’s network. In this section, these themes will be discussed and the support that the municipality offers on these themes will be examined. It was also decided to compare this support with the support that other stakeholders offer in the entrepreneurship ecosystem so that the support offered by the municipality can be placed in a larger context.

Knowledge

There is a wide range of accelerator programs in the Amsterdam ecosystem for social entrepreneurs. The results show that these programs, such as Impact Hub, are rather popular. It is also apparent from the interviews that the programs of network organizations are generally more visible than similar programs initiated by the municipality. This is because the municipality of Amsterdam often implements the programs together with network organizations or outsources them completely. The role of the municipality becomes invisible to many entrepreneurs. In addition, it appears that the position of the municipality, when it comes to knowledge, is often seen as subordinate to the role that network organizations play for social entrepreneurs. As this quote shows:

We get much more out of a network like Impact Hub than what is now being provided by the municipality itself. Simply because those people [from Impact Hub] have so much more knowledge and can offer so much more to us as additional value. (Respondent 4, social entrepreneur)

In addition to participating in accelerator programs to increase knowledge in the field and to improve entrepreneurship, there are also entrepreneurs who follow training courses that are offered by commercial players in the ecosystem, for example by banks such as ING and ABN AMRO. Entrepreneurs who have participated in accelerator programs indicate that they have experienced the support as very welcome and that the various organizations think along with them about how to accomplish their ideas. The emphasis on the fact that these organizations think along with them was sometimes meant to imply that the municipality does not do this when offering its support.

Within the social entrepreneurship ecosystem of Amsterdam, network organizations play a connecting role in the provision of knowledge. Network organizations can, for example, claim or make use of Big Four consultants. Network organizations are also actively committed to broadening the municipality’s knowledge about social entrepreneurs, while also offering social entrepreneurs training courses to improve contact with the municipality. In this regard, they can be interpreted as mediators in the ecosystem.

Financing

Within the ecosystem, the municipality provides both direct and indirect financial support. They are both strengthening networks for raising capital and involved in direct financing or grant-making. All organizations in the Netherlands that employ people with a distance to the labor market receive subsidy funds from the municipality because they contribute to labor market participation. In the group of social nurturers there are social entrepreneurs who get their clients through subcontracting. When this is the case, a large welfare organization acts as an intermediary and the municipality is often less directly in the picture.

All social entrepreneurs can also claim a subsidy if they are committed to social innovation. In practice, however, this does not always apply to entrepreneurs who focus on sustainability. One of the social innovators interviewed indicated that they: “must be more sustainable than sustainable to say that you are a green initiative” (Respondent 1, social entrepreneur). In addition, some conversations also get stuck because it is not clear to civil servants to which subsidy someone is entitled. This is due to the fact that not all of the impact areas of the entrepreneurs fit exactly in the framework set by the municipality for a subsidy. Social innovators often focus on several pillars of sustainability or are active in the field of sustainability, as well as in poverty alleviation or neighbourhood improvement. Here, too, the conflicting logic of both parties reappears. On the other hand, the interviews also indicated that entrepreneurs who specifically focus on a certain area within the sustainability sector receive a different signal and are told by the municipality that they need to work more across domains in order to qualify for subsidy. This makes it seem that officials within the municipality sometimes contradict each other. In his research, Karré (2018), however, gives another possible explanation for why it is difficult for social entrepreneurs to receive subsidies, other than wage dispensation, from the municipality. His research shows that the hybrid nature of social enterprises makes it difficult to raise funds, because the objectives and activities of social entrepreneurs are difficult to frame and can therefore be characterized as ambiguous. We also see that the hybrid nature of social entrepreneurs can pose a problem with this entrepreneur:

In any case, it is completely unclear what the normal course of action is within the municipality and how things work. In the end I got to the right person. There I was introduced.. but I actually had to tell the story again, and when I did it, that person actually said that I might do beautiful things, but that I was an entrepreneur, so I wanted to make money, so I was not at the right place. Because he was trying to help schools instead of helping commercial people earn more money. So then I stood in front of a closed door, which I have not been able to get through. (Respondent 7, social entrepreneur)

The results show that it is especially difficult for civil servants of municipalities to see the social impact that the enterprise aims to create. It also emerges that the entrepreneur's contact person recognizes the impact, but the officials who award the subsidy do not recognize it. Furthermore, social entrepreneurs indicate that financing from the municipality often involves small amounts and should also often be community-oriented. This means that social entrepreneurs are also dependent on other capital providers within the entrepreneurship ecosystem. Social entrepreneurs state that network organizations often bring them into contact with other capital providers through investment-ready programs in which they become entrepreneurs primed to attract investors. This form of support is therefore indirect.

Support in the field of procurement and tender processes

According to the entrepreneurs, the municipality’s procurement and tendering processes need the most attention and innovation. A revenue model is essential for social entrepreneurs to make an impact. The municipality, as a customer, can therefore provide good support and also ensure a more business-like rather than dependent relationship. This also fits in with the autonomy that social entrepreneurs demand (Backer, 2019). The entrepreneurs believe that the municipality expresses the most support to them by entering into this type of procurement process, because this means that they are seen as entrepreneurs and not as philanthropic institutions.

The social nurturers interviewed for this study indicate that the assignments of the municipality are often too large and do not fall within the capacity of the social entrepreneur. They also state that the municipality is not prepared to split the contract up to make it accessible to this type of entrepreneurs, which results in automatically opting for the largest and cheapest provider. Despite the municipality's new work plan for social procurement, social nurturers experience a lack of investment in making procurement processes accessible. One of the social nurturers puts it this way:

I see very little active policy on that. As a social entrepreneur, I think we should have more benefits, we contribute so enormously to people and society in this city, which I am committed to with heart and soul and sometimes work through weekends to get things done, and yet we are simply seen as commercial entrepreneurs. (Respondent 3, social entrepreneur)

Social innovators also often run into the well-defined boundaries of the municipality when it comes to purchasing and tendering processes at the municipality. Almost all conversations show that the social innovators would like the municipality to purchase from them. The municipality can do more to use its network to establish connections with other companies and to ensure that it acts as a launching customer. However, the latter is more difficult to achieve for the municipality because it wants to maintain a level playing field for all forms of entrepreneurship. This is also laid down in procurement legislation from the national government (Karré, 2021).

In addition to purchasing and tendering processes, there is also the social return for social nurturers policy. This policy encourages companies to buy from social firms. Social nurturers are featured on a social map of the municipality of Amsterdam. The results show that some social nurturers are often asked for this type of purchase and they submit, for example production of promotional gifts for companies. Other entrepreneurs indicate that the social map is not sufficiently visible to companies and that the social return policy does not work for them. Some entrepreneurs also question the enforcement and supervision of the social return policy.

Network

When it comes to support, a network can be seen as the most important pillar for social entrepreneurs. Hulgard and Spear (2006) underline the importance of formal and informal networks for social enterprises. In addition, they argue that the hybrid nature of social entrepreneurs also ensures that there are multiple stakeholders and therefore a more intensive use of the network. The results show that within the ecosystem, there are various mutual networks of social entrepreneurs. Additionally, various network meetings are often used to find stakeholders who can contribute to the enterprise. When discussing to what extent the municipality facilitates the stakeholder network of the social entrepreneurs, the social entrepreneurs often mention the guiding function the municipality occupies in regard to the social entrepreneur. Social nurturers are often supported by and often dependent on the flow of clients from the municipality.

It is also striking that almost all social entrepreneurs have approached the municipality at some point to get in touch with stakeholders in its network. Some of the entrepreneurs indicate that they have already started contacting the municipality in the start-up phase of their business to see how it can support them. Closer contact in the startup phase is often related to finding an accelerator program, subsidy, or a sustainable partner in the municipality.

The social entrepreneurs are therefore generally aware of the role as a guide that the municipality has in the ecosystem. According to the entrepreneurs, Amsterdam Impact mainly focuses on bringing entrepreneurs into contact with programs offered by the municipality or connecting them with other players in the field. However, some entrepreneurs do question the efficiency and accessibility of the municipal organization because their experiences make it clear that communication with and accessibility of the municipality is an obstacle. For example, some have never had a response after seeking contact.

Then we thought, can’t we get started with support from the municipality in a form of subsidy, for example, or with specific guidance, or you name it? And then we have actually had quite a few conversations, but nothing really concrete came out of them. (Respondent 12, social entrepreneur).

These kinds of experiences logically mean that entrepreneurs often fail to contact the municipality again because they do not expect to be supported. As a result, the municipality is no longer seen as a potential stakeholder for the enterprise to broaden their network. The majority of social entrepreneurs experience more support on this front from network organizations such as Social Enterprise NL and Impact Hub than from the municipality of Amsterdam. However, the results do show that social entrepreneurs who have followed a support or accelerator program at the municipality are less critical of the guiding function of the municipality of Amsterdam. They state that the municipality uses its network to connect them to potential stakeholders and to create the right conditions for a good business climate. Nevertheless, the municipality seems to be less visible as a network supporter. In addition, a number of entrepreneurs from the respondent group indicated that the municipality offers access to a network that does not meet their needs, because they do not experience it as a professional stakeholder.

They do participate, but they can play that connecting role just a little more, on a more professional level that it also becomes a little more interesting for us. (Respondent 4, social entrepreneur)

So yes, and I am sometimes invited to events and we were allowed to speak there, well, nothing ever came of it, that was so clumsy. I don't feel supported by the municipality. I do not meet customers there, so I do not see that the municipality hiring us more because of that (Respondent 3, social entrepreneur).

The lack of professionalism that these entrepreneurs experience in the support that the municipality offers can be explained in different ways. First of all, network organizations have had a place in the ecosystem of social entrepreneurs in Amsterdam for a long time. The networks that these organizations have developed are large and offer many opportunities for social entrepreneurs to forge new stakeholder relationships. In addition, earlier research has shown that social entrepreneurs use their network to obtain resources (Casson and Giusta, 2007). According to the entrepreneurs, the meetings organized by the municipality are more often a place to meet people from the neighborhood or other social entrepreneurs. As a result, these network meetings are less effective for accessing resources. The entrepreneurs indicated that they would like to know beforehand whether they can get something out of the energy they put in and whether there is an “incentive” in it (Respondent 12, social entrepreneur). A number of respondents also indicated that the municipality often does not understand the entrepreneur and this causes processes to be slow, which makes them prefer to work with a network organization.

The relationship of social entrepreneurs with the municipality of Amsterdam

In the relationship that social nurturers have with the municipality, the local component of the social enterprises often comes up. The social nurturers interviewed for this study often work with a small team and their enterprise is embedded in the neighborhood. This means that the entrepreneurs are mainly visible to the municipality at district level and that they feel less connected to the central city.

And yes, since then I have had quite close contact with the municipality, at least with the area brokers (gebiedsmakelaars) […] they keep a close eye on what is happening in the area, of course. So I always know if I have questions, who I should be with in any case, those are nice contact persons within the municipality in any case. (Respondent 10, social entrepreneur)

Compared to social nurturers, social innovators have less frequent contact with the municipality, which is also of a different nature. The interviews show that social innovators seem to move more autonomously in relation to the municipality. When it comes to interactions with Amsterdam impact, the social innovators are generally assigned a contact person, also called an ecosystem liaison. Just like with the social nurturers, this contact person has great value for the entrepreneur, yet plays a different role. This ecosystem liaison is in fact an expert in the field of social entrepreneurship themes and has a more guiding role to other departments within the municipality and stakeholders in the ecosystem.

The relationship between the municipality and social entrepreneurs is largely determined by the perceived accessibility of the municipality. When the interface of the municipality is perceived as unclear or communication fails, this has major consequences for its perceived legitimacy as a stakeholder. Failures and lack of clarity mean that the municipality is often perceived by social entrepreneurs as a cumbersome organization, despite its support initiatives in the field. The vast majority of the interviewed respondents would have liked to build a relationship with the municipality, but the glitches in the process meant that access to support could not be fully utilized and that entrepreneurs felt no need to further develop a stakeholder relationship with the municipality.

The municipality of Amsterdam is aware of the fact that some entrepreneurs are critical of municipalities and that this dissatisfaction with the relationship with municipalities is also reflected in the monitors of Social enterprise NL, among others. The response of one of the respondents is as follows:

As a municipality or as a government, we look at what can be done and how we can get things done and change things, but not everything is possible. Sometimes there is also certain policy from the council that may be contrary to it. So that someone has a solution or product, for which we as a municipality have a different policy. Then you just have to explain that well that you have this idea, but our experience is this and this and that. Someone filling out such a monitor might not be happy about that, but that's also hard to change. So that is also all included (Respondent 19, Municipality of Amsterdam).

The relationship that the municipality of Amsterdam has with social entrepreneurs shows that the municipality recognizes that social entrepreneurs and the municipality generally use a different working method. After all, the traditional approach of government is to limit risk by using public resources for the common good, while the role of a social entrepreneur is to take risks to innovate social welfare. Amsterdam Impact indicates that they are questioning this traditional set-up and are actually bringing together the various players in the ecosystem to reconcile multiple perspectives and build trust (Municipality of Amsterdam, 2019a). Stimulating these public-private partnerships seems to be based on bridging conflicting logic between policy makers and social entrepreneurs (Doherty et al., 2014; Karré, 2018; Pache and Chowdhury, 2012; Schultz et al., 2013; Smeets, 2017; Tracey et al., 2011). The support system offered by the municipality to the social entrepreneurs can be divided into direct and indirect support (Kim et al., 2014). Our findings reveal that the municipality mainly choses to focus on indirect support within the ecosystem as opposed to direct support. It facilitates this by creating connections in the ecosystem and by initiating network organizations, such as the Sociaal Werkkoepel, which social nurturers can rely on. According to the municipality of Amsterdam, the relationships with social enterprises are strengthened through, among other things, community building events and meet-ups for social entrepreneurs and other stakeholders within the ecosystem.

According to one of the employees of the municipality of Amsterdam, the ecosystem approach contributes to full support and guidance. For subjects in which Amsterdam Impact is not an expert on, social enterprises are referred to other departments where this expertise can be found, such as Sociaal Werkkoepel. Since the establishment of the Action program of 2015-2018, attention thus has been paid to strengthening the interface between social enterprises and the municipality (Amsterdam Municipality, 2015). The main reason for municipality to give importance to theme was because of a research the municipality has carried out itself which showed that social enterprises often do not know exactly where they can go within the municipality and because they are impact-driven, they often need a link with policy departments (Amsterdam Municipality, 2015).

Research has already shown that the different institutional logics that the municipality and the social entrepreneur use can sometimes be conflicting (Doherty et al., 2014; Karre, 2012; Pache and Chowdhury, 2012; Schultz et al., 2013; Smeets, 2017; Tracey et al., 2011). Earlier it became clear that Amsterdam Impact is aware of the conflicting logic in the public-private partnership with social entrepreneurs. They stated that because of their ecosystem approach, they could bring different perspectives together without conflict. However, the experiences of the social entrepreneurs show that they are still clashing with the culture of the municipal organization.

Conclusion and discussion

In this paper, we tried to show how two different actors, social enterprises and municipalities, position themselves in the Dutch social entrepreneurship ecosystem and how they make sense of their collaboration. We think that these issues were important to dwell on to see the limit of collaborative governance approaches.

The support system offered by the municipality to the social entrepreneurs can be divided into direct and indirect support (Kim et al., 2014). Our findings reveal that the municipality mainly chooses to focus on indirect support within the ecosystem as opposed to direct support. It facilitates this by creating connections in the ecosystem and by initiating network organizations, such as the Sociaal Werkkoepel, which social nurturers can rely on. According to the municipality of Amsterdam, the relationships with social enterprises are strengthened through, among other things, community building events and meet-ups for social entrepreneurs and other stakeholders within the ecosystem.

The municipality of Amsterdam provides support initiatives for social enterprises in the hope of creating a supportive ecosystem. The pillars on which the municipality of Amsterdam acts in this regard (knowledge, financing, procurement and tender processes, and facilitating a stakeholder network) correspond to the resources of Spigel (2017) that have already emerged in the theoretical framework. Spigel (2017) argues that good support should contribute to a shared cultural understanding and an institutional environment, with knowledge transfer and support networks to remove institutional barriers for social enterprises

The expectation prior to this study was that the ecosystem vision adopted by the municipality and the various policy programs that have been developed to support social entrepreneurship would contribute to a better working ecosystem for social entrepreneurs. In reality, the support that the municipality provided turned out to be much more fragmented. This is very much in line with decentered actor perspective, showing us one more time how in the governance of wicked problems we encounter an actor-based understanding that dominates the nature of collaboration.

The results of this study show that the ties between the municipality of Amsterdam and social entrepreneurs are not strong enough to overcome the institutional barriers between the two parties and that the relationship between social entrepreneurs and the municipality is disrupted by the different logics used. Social entrepreneurs operate from both a social and commercial logic (Doherty et al., 2014; Karré, 2018). Where the social entrepreneur sees itself as a noble organization that puts impact first, the municipality also sees the commercial logic in granting subsidies that social enterprises also use. This means that social enterprises do not always fit within the frameworks offered by the municipality, because their commercial logic is seen as less legitimate when it comes to support. The results of this study not only confirm research by Kraatz and Block (2008) in which it appears that social entrepreneurs need to influence public actors to legitimize their hybrid character, but also show that perceived hybridity of social entrepreneurs differs per type of enterprise. The observed hybridity of social nurturers in this study is lower than that of other social enterprises and is therefore less of a problem for this group.

In addition, the results of this research made it clear that other stakeholders, such as network organizations in the ecosystem, can play a mediating role to bridge the conflicting logics and strengthen the relations between social entrepreneurs and municipalities. Network organizations can bring entrepreneurs and municipalities closer together by offering various programs because they remove the institutional barriers to the community more easily.

By looking at the meso level of the support that the municipality offers in the ecosystem of social entrepreneurs in Amsterdam, this study has contributed to the analysis of the role of government in the ecosystem of social entrepreneurs. This study addressed the request of several academics to investigate how support initiatives influence the effectiveness of the social entrepreneur ecosystem (Spigel, 2016; Roundy, 2017; Cagarman et al., 2020). Several authors point to the importance of the role of government in supporting social enterprises (Cagarman et al., 2020; Hogenstijn et al., 2018; Korosec and Berman, 2006; Roundy, 2017; Spigel, 2016). This study agrees with Pel's previous studies et al. (2020) and Neumeyer and Santos (2018) who argue that ecosystems provide an adequate framework to examine the structures of relationships. Moreover, it explicates that in the context of Amsterdam, the support the municipality offers cannot be understood separately from stakeholder relations in the ecosystem. Further analyzing relational perspectives, stakeholder relationships, and social networks in the ecosystem can contribute to mapping the support that governments provide or do not provide to social entrepreneurs. Another possible research terrain could be on building on the classification of Dagevos et al. (2015); exploring how all four different types of social entrepreneurs conceptualize wicked problems of today; comparing it to the way municipalities understand these problems in a thorough manner and try to delineate various repercussions that this divide brings for the enterprises and for the eco-system.

Footnotes

Acknowledgements

We thank the interview participants for their participation and insights. We are also deeply thankful to the two eviewers for their insightful comments and feedback on the manuscript.

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship, and/or publication of this article.

ORCID iD

Seda Muftugil-Yalcin

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Making sense of each other: Relations between social enterprises and the municipality

Abstract

Keywords

Introduction

Theoretical framework

The ecosystem as a supportive environment

The government as a stakeholder in the ecosystem of social entrepreneurs

Methods

A note on the typology of social enterprises

Research findings

Needs of social entrepreneurs in the entrepreneurship ecosystem

Knowledge

Financing

Support in the field of procurement and tender processes

Network

The relationship of social entrepreneurs with the municipality of Amsterdam

Conclusion and discussion

Footnotes

Acknowledgements

Declaration of conflicting interests

Funding

ORCID iD

References