When tensions and barriers destroy social impact businesses: Multiple case studies based on Brazilian experience

Abstract

Objective: This work aims to understand the failure of Social Impact Businesses (SIBs) in Florianópolis between 2017 and 2022 from the perspective of key stakeholders. Therefore, the enterprises SIB 1, SIB 2, and SIB 3 were studied. Methodology/approach: The research uses a qualitative, exploratory-descriptive approach, based on a multiple case study. The data were subjected to thematic, documentary, and interpretative analysis. Main results: Based on the tensions and barriers expressed in the field, four reasons related to the failure of SIBs were identified: (1) The shortage of financiers in the commercial and social-environmental fields; (2) The misalignment of support organizations with the local context; (3) Imbalance between social-environmental and commercial activities; and (4) Difficulty in defining a sustainable business model. Theoretical/methodological contributions: The reasons for the discontinuation of SIBs are related to the tensions and barriers identified in the literature. Interviews with key stakeholders provided a detailed analysis of the main challenges involving SIBs. Relevance/originality: The almost non-existent research on the failure of this type of enterprise justifies the present research and contributes to the literature and practice in the field of social enterprises. Social/management contributions: The study delves into the practical and contextual challenges that impact SIBs. The findings provide useful insights for managers, support organizations, and investors, helping them develop strategies to overcome these challenges faced by SIBs.

Keywords

• Social Impact Business
• Social Enterprises
• Demise
• Organizational Hybridity
• Tensions
• Barriers