Advertisement

The Evolution of a Social Service Crowdfunding Platform Towards an Investing Logic: The Meridonare Case Study

  • Carmen GallucciEmail author
  • Michele Modina
  • Antonio Minguzzi
Chapter
Part of the Palgrave Studies in Impact Finance book series (SIF)

Abstract

This study aims to configure an innovative financial structure for social impact investments. Framing on the Theory of Change, we apply an exploratory analysis to the Meridonare case study, a donation/reward crowdfunding platform led by the Banco di Napoli Foundation and engaging in philanthropy in the social sector. Over the years, the platform has changed the Foundation’s resource allocation procedures through the adoption of an “impact model” evaluation process. Accordingly, for each financing request, Meridonare defines a social evaluation report allowing the Foundation to establish which projects are worthy of additional funds as rewards. However, in its current state, the Meridonare crowdfunding platform lacks the investing perspective, thus we propose an innovative instrument of Social Finance: the Social Bond Crowdfunding based (SBCb), arising from the “pay-for-performance” rewarding mechanism. Therefore, the role of the Foundation shifts from impact facilitator to impact generator.

Keywords

Crowdfunding Crowdfunding platforms Foundation Pay-for-performance mechanism 

References

  1. Agrawal, A. K., Catalini, C., & Goldfarb, A. (2011). The geography of crowdfunding (NBER Working Paper 16820). Cambridge, MA: National Bureau of Economic Research. Retrieved from http://www.nber.org/papers/w16820.
  2. Arvidson, M., Lyon, F., McKay, S., & Moro, D. (2010). The ambitions and challenges of SROI (TSRC Working Paper 49). Birmingham: Third Sector Research Centre. Retrieved from http://www.tsrc.ac.uk/LinkClick.aspx?fileticket=QwHhaC%2br88Y%3d&tabid=500.
  3. Azemati, H., Belinsky, M., Gillette, R., Liebman, J., Selman, A., & Wyse, A. (2013). Social impact bonds: Lessons learned so far. Community Investment Review, 9(1), 23–33.Google Scholar
  4. Bammi, R., & Verma, A. (2014). Venture philantropy: An emerging paradigm of venture capital. The XIMB Journal of Management, 11(2), 127–140.Google Scholar
  5. Barraket, J., & Yousefpour, N. (2013). Evaluation and social impact measurement amongst small to medium social enterprises: Process, purpose and value. Australian Journal of Public Administration, 72(4), 447–458.  https://doi.org/10.1111/1467-8500.12042.CrossRefGoogle Scholar
  6. Belleflamme, P., Lambert, T., & Schwienbacher, A. (2014). Crowdfunding: Tapping the right crowd. Journal of Business Venturing, 29(5), 585–609.  https://doi.org/10.2139/ssrn.1836873.CrossRefGoogle Scholar
  7. Brandsetter, L., & Lehner, O. M. (2015). Impact investment portfolios: Including social risks and returns. Oxford: ACRN Oxford Publishing House.Google Scholar
  8. Bull, M. (2007). Balance: The development of a social enterprise business performance analysis tool. Social Enterprise Journal, 3(1), 49–66.  https://doi.org/10.1108/17508610780000721.CrossRefGoogle Scholar
  9. Cantino, V., Coni, S., & Fiandrino, S. (2016). Venture philantropy: il supporto non finanziario a sostegno dell’imprenditorialità sociale. Il caso di Fondazione CRT. Rivista impresa sociale, 8. Retrieved from http://www.rivistaimpresasociale.it/rivista/item/160-venture-philanthropy-supporto-non-finanziario-imprenditorialita-sociale-fondazione-crt.html.
  10. Castello, S., & Lévêque, C. (2016). La Theory of change come impact-model: diffusione e utilizzo a livello nazionale e internazionale. Philanthropy Insights, 4. Fondazione Lang Italia. Retrieved from http://en.fondazionelangitalia.it/wp-content/uploads/2016/03/Philanthropy-Insights-n_4.pdf.
  11. CESE. (2013). Parere sul tema “La misurazione dell’impatto sociale”. Retrieved from http://www.socialelazio.it/binary/prtl_socialelazio/tbl_buonepratiche/misurazione_impatto_sociale.pdf.
  12. Clarkin, J. E., & Cangioni, C. (2016). Impact investing: A primer and review of the literature. Entrepreneurship Research Journal, 6(2), 135–173.  https://doi.org/10.1515/erj-2014-0011.CrossRefGoogle Scholar
  13. Coleman, J. (1990). Foundations of social theory. Cambridge: Harvard University Press.Google Scholar
  14. Crescentini, L., & Zaccardi, E. (cur.). (2016). Investimento ad impatto sociale: analisi ed opportunità. Quaderno di approfondimento Assoprevidenza. Retrieved from https://assoprevidenza.it/quaderni/investimenti-a-impatto-sociale-analisi-e-opportunita-2/.
  15. Crutchfield, L. R., & Grant, H. M. (2008). Forces for good: The six practices of high impact nonprofits. San Francisco, CA: Jossey Bass.Google Scholar
  16. Daggers, J., & Nicholls, A. (2016). Academic research into social investment and impact investing: The status quo and future research. In O. M. Lehner (Ed.), Routledge handbook of social and sustainable finance (pp. 68–82). London: Routledge.Google Scholar
  17. Del Giudice, A. (2015). I social impact bond. Milano: Franco Angeli.Google Scholar
  18. Eisenhardt, K. M. (1989). Building theories from case study research. Academy of Management Review, 14(4), 532–550.  https://doi.org/10.5465/AMR.1989.4308385.CrossRefGoogle Scholar
  19. Estévez, R. A., Walshe, T., & Burgman, M. A. (2013). Capturing social impacts for decision-making: A multicriteria decision analysis perspective. Diversity and Distributions, 19(5–6), 608–616.CrossRefGoogle Scholar
  20. Evans, M. (2013). Metting the challenge of impact investing: how can contracting practing secure social impact without sacrificing performance? Journal of Sustainable Finance & Investment, 3(2), 138–154.CrossRefGoogle Scholar
  21. Feola, M., Parente, R., D’Onofrio, T., & Marinato, E. (2017). The evolution of crowdfunding towards an impact investing logic: The case of Paulownia Social Project. Journal of Modern Accounting and Auditing, 13(1), 19–34.Google Scholar
  22. Financial Times. (2016). Investing for global impact 2016.Google Scholar
  23. Fondazione Cariplo. (2013). I social impact bond – La finanza al servizio dell’innovazione sociale. Quaderni dell’Osservatorio, 11.Google Scholar
  24. Fondazione Sodalitas. (2015). Introduzione alla finanza sociale. Retrieved from http://www.sodalitas.it/public/allegati/Quaderno-Sodalitas-DEF_2015324184115309.pdf.
  25. Freireich, J., & Fulton, K. (2009). Investing for social & environmental impact: A design for catalyzing an emerging industry. Cambridge, MA: Monitor Institute.Google Scholar
  26. Freund, R. (2012). How to overcome the barriers between economy and sociology with open innovation, open evaluation and crowdfunding? International Journal of Industrial Engineering and Management, 1(3), 107–109.Google Scholar
  27. Geobey, S., & Weber, O. (2013). Lessons in operationalizing social finance: The case of Vancouver City Savings Credit Union. Journal of Sustainable Finance & Investment, 3(2), 124–137.  https://doi.org/10.1080/20430795.2013.776259.CrossRefGoogle Scholar
  28. Gonnella, C., & Cerlenco, S. (2016). La finanza ad impatto sociale. Fondazione Tertio Millennio-Onlus. Roma: Ecra.Google Scholar
  29. Harji, K., & Hebb, T. (2010). Investing for impact: Issues and opportunities for social finance in Canada. Ottawa: Carleton Centre for Community Innovation.Google Scholar
  30. Harji, K., & Jackson, E. T. (2012). Accelerating impact: Achievements, challenges and what’s next in building the impact investing industry. New York, NY: The Rockefeller Foundation.Google Scholar
  31. Hill, K. R., Walter, R. S., Bozicevic, M., Eder, J., Headland, T., Hewlett, B., et al. (2011). Co-residence patterns in hunter-gatherer societies show unique human social structure. Science, 331(6022), 1286–1289.  https://doi.org/10.1126/science.1199071.CrossRefGoogle Scholar
  32. Hochstadter, A. K., & Scheck, B. (2015). What’s in a name: An analysis of impact investing understandings by academics and practitioners. Journal of Business Ethics, 13(2), 449–475.CrossRefGoogle Scholar
  33. Howe, J. (2006). The rise of crowdsourcing. Wired Magazine, 14(6), 1–4.Google Scholar
  34. Imbert, D., & Knoepfel, I. (2011). 360-degrees for mission – How lending European foundations use their investment to support their mission and the greater good. Stocholm: Mistra.Google Scholar
  35. Jackson, E. T. (2013). Evaluating social impact bonds: Questions, challenges, innovations, and possibilities in measuring outcomes in impact investing. Community Development, 44(5), 608–616.  https://doi.org/10.1080/15575330.2013.854258.CrossRefGoogle Scholar
  36. Kail, A., & Lumley, T. (2012). Theory of change. The beginning of making a difference. London: New Philantropy Capital.Google Scholar
  37. Know, S., & Arenius, P. (2010). Nations of entrepreneurs: A social capital perspective. Journal of Business Venturing, 25(3), 315–330.CrossRefGoogle Scholar
  38. Krugman, P. (2014, September 14). How to get it wrong. The New York Times. Retrieved from https://www.nytimes.com/2014/09/15/opinion/paul-krugman-how-to-get-economic-policy-wrong.html.
  39. La Torre, M. (2013). Banche e welfare: Microcredito, crowdfunding e social impact investments. MK, 5, 28–34.Google Scholar
  40. Landstrom, H. (1992). The relationship between private investors and small firms: An agency theory approach. Entrepreneurship & Regional Development, 4(3), 199–223.  https://doi.org/10.1080/08985629200000012.CrossRefGoogle Scholar
  41. Lane, M. D., & Casile, M. (2011). Angels on the head of a pin: The SAC framework for performance measurement in social entrepreneurship ventures. Social Enterprise Journal, 7(3), 238–258.  https://doi.org/10.1108/17508611111182395.CrossRefGoogle Scholar
  42. Lehner, O. M. (2016). Routledge handbook of social and sustainable finance. London: Routledge.Google Scholar
  43. Letts, C. W., Ryan, W. P., & Grossman, A. S. (1995). Virtuous capital: What foundations can learn from the venture capitalists. Harvard Business Review, March–April.Google Scholar
  44. Louche, C., Arenas, D., & van Cranenburgh, K. (2012). From preaching to investing: Attitudes of religious organizations towards responsible investment. Journal of Business Ethics, 110(3), 301–320.  https://doi.org/10.1007/s10551-011-1155-8.CrossRefGoogle Scholar
  45. Marlett, D. (2015). Crowdfunding art, science and technology: A quick survey of the burgeoning new landscape. Leonardo, 48(1), 104–105.  https://doi.org/10.1162/LEON_a_00813.CrossRefGoogle Scholar
  46. Martin, M. (2013). Making impact investible (Impact Economy Working Papers 4). Lausanne: Impact Economy. Retrieved from http://www.impacteconomy.com/download/Impact%20Economy%20-%202013%20-%20Making%20Impact%20Investible.pdf.
  47. Nel, E. L., & McQuaid, R. W. (2002). The evolution of local economic development in South Africa: The case of Stutterhein and social capital. Economic Development Quarterly, 16(1), 60–74.  https://doi.org/10.1177/0891242402016001007.CrossRefGoogle Scholar
  48. Nicholls, A. (2009). We do good things, don’t we? Blended value accounting in social entrepreneurship. Accounting, Organizations and Society, 34(6–7), 755–769.CrossRefGoogle Scholar
  49. Nicholls, A. (2010). The legitimacy of social entrepreneurship: Reflexive isomorphism in a pre-paradigmatic field. Entrepreneurship Theory and Practice, 34(4), 611–633.  https://doi.org/10.1111/j.1540-6520.2010.00397.x.CrossRefGoogle Scholar
  50. Nicholls, A., & Daggers, J. (2016). The landscape of social impact investment research: Trends and opportunities. Oxford: University of Oxford.Google Scholar
  51. Nicholls, A., Nicholls, J., & Paton, R. (2015). Measuring social impact. In A. Nicholls, J. Emerson, & R. Paton (Eds.), Social finance (pp. 253–281). Oxford: Oxford University Press.CrossRefGoogle Scholar
  52. O’Donohoe, N., Leijonhufvud, C., Saltuk, Y., Bugg-Levine, A., & Brandeburg, M. (2010). Impact investments: An emerging asset class. New York: JP Morgan Social Finance-GIIN.Google Scholar
  53. OECD. (2015). Social impact investment: Building the evidence base. Retrieved from http://www.oecd.org/sti/ind/social-impact-investment.pdf.
  54. Ordanini, A., Miceli, L., Pizzetti, M., & Parasuraman, A. (2011). Crowd-funding: Transforming customers into investors through innovative service platforms. Journal of Service Management, 22(4), 443–470.  https://doi.org/10.1108/09564231111155079.CrossRefGoogle Scholar
  55. Perrini, F. (2007). Social entrepreneurship. imprese innovative per il cambiamento sociale. Milano: Egea.Google Scholar
  56. Perrini, F., & Vurro, C. (2013). La valutazione degli impatti sociali. Approcci e strumenti applicativi. Milano: Egea.Google Scholar
  57. Porter, M. E., & Kramer, M. R. (2011). The big idea: Creating shared value. Harvard Business Review, 89(1), 2.Google Scholar
  58. Putnam, R. D. (2000). Capitale sociale e individualismo. Crisi e crescita della cultura civica in America. Bologna: Il Mulino Saggi.Google Scholar
  59. Rappaport, A. (2012). Salvare il capitalismo. Come riprendere il controllo della finanza e tornare a creare valore a lungo termine. Milano: Franco Angeli.Google Scholar
  60. Rizzello, A., Migliazza, M., Carè, R., & Trotta, A. (2016). Social impact investing: A model and research agenda. In O. M. Lehner (Ed.), Routledge handbook of social and sustainable finance (pp. 102–124). London: Routledge.Google Scholar
  61. Roche, C. (1999). Impact assessment for development agencies: Learning to value change. Oxford: Oxfam GB.CrossRefGoogle Scholar
  62. Roxas, H. B., & Azmat, F. (2014). Community social capital and entrepreneurship: Analyzing the links. Community Development, 45(2), 134–149.  https://doi.org/10.1080/15575330.2014.880495.CrossRefGoogle Scholar
  63. Saltuk, Y., Bouri, A., & Leung, G. (2011). Insight to the impact investing market: An in-depth analysisof investor perspectives. New York: JP Morgan Social Finance-GIIN.Google Scholar
  64. Schinckus, C. (2015). The valuation of social impact bonds: An introductory perspective with the Peterborough SIB. Research International Business and Finance, 35(C), 104–110.  https://doi.org/10.1016/j.ribaf.2017.07.126.CrossRefGoogle Scholar
  65. Schwienbacher, A., & Larralde, B. (2010). Crowdfunding of small entrepreneurial ventures. In D. Cumming (Ed.), Handbook of entrepreneurial finance (pp. 3–19). Oxford: Oxford University Press.Google Scholar
  66. Shaw, E., & Carter, S. (2007). Social entrepreneurship: Theoretical antecedents and empirical analysis of entrepreneurial processes and outcomes. Journal of Small Business and Enterprise Development, 14(3), 418–434.  https://doi.org/10.1108/14626000710773529.CrossRefGoogle Scholar
  67. Shiller, R. J. (2012). Finanza e società giusta. Milano: Il Mulino.Google Scholar
  68. Slootweg, R., Vanclay, F., & van Schooten, M. (2011). Function evaluation as a framework for the integration of social and environmental impact assessment. Impact Assessment and Project Appraisal, 19(1), 19–28.  https://doi.org/10.3152/147154601781767186.CrossRefGoogle Scholar
  69. Social Impact Investment Task Force. (2014). La finanza che include: gli investimenti ad impatto sociale per una nuova economia. Retrieved from http://www.socialimpactagenda.it/wp-content/uploads/2016/04/La-finanza-che-include.pdf.
  70. Solari, L. (1997). Implicazioni organizzative di un approccio multistakeholder. Impresa Sociale, 31, 43–47.Google Scholar
  71. Trotta, A., Carè, R., Severino, R., Migliazza, M. C., & Rizzello, A. (2015). Mobilizing private finance for public good: Challenges and opportunities of social impact bonds. European Scientific Journal, 1, 259–279.Google Scholar
  72. Venturi, P., & Zandonai, F. (2014). Ibridi organizzativi. L’innovazione sociale generata dal gruppo cooperativo Cgm. Bologna: Il Mulino.Google Scholar
  73. Viviers, S., Ratcliffe, T., & Hand, D. (2011). From philanthropy to impact investing: Shifting mindsets in South Africa. Corporate Ownership and Control, 8(3–1), 25–43.  https://doi.org/10.22495/cocv8i3c1p5.CrossRefGoogle Scholar
  74. Weber, O. (2012). Social finance and impact investing. Retrieved from http://ssrn.com/abstract=2160403.
  75. Weber, O. (2016). Impact investing. In O. M. Lehner (Ed.), Routledge handbook of social and sustainable finance (pp. 85–101). London: Routledge.Google Scholar
  76. Wheat, R. E., Wang, Y., Byrnes, J. E., & Ranganathan, J. (2013). Raising money for scientific research through crowdfunding. Trend in Ecology & Evolution, 28(2), 71–72.  https://doi.org/10.1016/j.tree.2012.11.001.CrossRefGoogle Scholar
  77. Wood, D., Thornley, B., & Grace, K. (2013). Institutional impact investing: Practice and policy. Journal of Sustainable Finance & Investment, 3(2), 75–94.  https://doi.org/10.1080/20430795.2013.776256.CrossRefGoogle Scholar
  78. Yin, R. K. (2014). Case study research: Design and methods. Thousand Oaks: Sage.Google Scholar
  79. Zamagni, S., Venturi, P., & Rago, S. (2015). Valutare l’impatto sociale. La questione della misurazione nelle imprese sociali. Impresa Sociale, 6, 77–97.Google Scholar

Copyright information

© The Author(s) 2018

Authors and Affiliations

  • Carmen Gallucci
    • 1
    Email author
  • Michele Modina
    • 2
  • Antonio Minguzzi
    • 2
  1. 1.University of SalernoFiscianoItaly
  2. 2.University of MoliseCampobassoItaly

Personalised recommendations