Amazon founder Jeff Bezos remarked that whenever he talked to entrepreneurs interested in working with the tech giant, he was always looking for “missionaries” instead of “mercenaries”. He believed that the best startups had founders focused on making great products or services that fundamentally change the world for the better. The money side would be taken care of to a great extent.
One could imagine that this intrinsic motivation is even more common among social entrepreneurs, who by definition focus primarily on improving various social, environmental, or cultural problems. It is a heuristic that has been examined in recent research by HEC Paris, which aims to understand what motivates social entrepreneurs.
The researchers worked with a major support agency for social entrepreneurs in the UK to try to get to the bottom of what motivates entrepreneurs to follow this path.
“The experiment encouraged 431 nascent social entrepreneurs to apply for a 12-month grant program that provides cash and in-kind mentoring support to social entrepreneurs, via a single email sent by the agency. e-mail support after they had indicated their initial interest in the program, ”the researchers explain.
“Individuals were randomly assigned to three groups: one group received a standard email emphasizing only intrinsic incentives (the opportunity to do well (social treatment) and the other two groups received an email that emphasized the extrinsic reward incentives) rewards (cash treatment) or in-kind rewards (supportive treatment) provided by the grant program. ”
The results suggest that Bezos made some money with his observation, as extrinsic rewards made fewer candidates apply to the program, with those who did apply tending to be more interested in money than in good. social.
Interestingly, however, these extrinsic reward indications also caused employers to devote more effort to their applications, which made those applications receive the grant more frequently. Although extrinsic rewards encouraged employers to apply, they were nonetheless less successful after a year in the program.
“Our results provide evidence that extrinsic incentive indications can promote effort and performance in the context of grant competition for social entrepreneurial enterprises, although they can also lead to (unwanted) costs,” say the researchers. “We found that these indications of extrinsic incentives, primarily monetary indications, piled up on relatively more money-oriented applicants, while eliminating their more prosocial and less money-oriented counterparts.”
In fact, it is interesting that those projects proposed by applicants with more extrinsic motivation were 20% less likely to benefit disadvantaged groups. In addition, these applicants tended to be less successful as social entrepreneurs, although they appeared to have superior proposals.
“Our results highlight the critical role of intrinsic reasons for the performance of social entrepreneurial enterprises and provide evidence that the extrinsic incentives commonly used to promote the development of successful social enterprises can in fact be counterproductive,” the researchers conclude.
While the paper did not examine the genre to see, Carnegie Mellon’s research last year did so definitively. They found that women used to be the most successful social entrepreneurs.
The researchers conducted three field experiments to fully understand what motivates employers. In total, they surveyed about 15,000 entrepreneurs who had participated in the Inclusive Innovation Challenge (IIC) at the Massachusetts Institute of Technology, as well as a bunch of entrepreneurs from the AngelList website.
Each of the entrepreneurs was sent a social impact message (related to the social impact of IIC projects), a financial message (related to the financial benefits of participating in IIC), or a neutral message focused primarily on technology. . The motivation of each employer was deduced from the response each gave to their particular message.
The feedback revealed clear differences among respondents, with women much more sensitive to the social impact message than the financial message, with men typically upside down. The authors believe that this difference is likely to be motivated by the specific differences in the social impact message.
“Our findings suggest that it is important to have a broader conceptualization of the motivations of innovative entrepreneurs that focuses on motivations beyond profit and takes into account the fundamental dimensions of heterogeneity, such as gender and culture,” the researchers conclude. “The results can inform interventions that encourage innovative entrepreneurship policies and programs.”
If we want to encourage entrepreneurs to really change the world instead of trying to get rich quick, this kind of understanding of what motivates entrepreneurs can be crucial when it comes to writing programs to give them the best support.