Abstract

Attracting resources is arguably the ultimate priority for newly founded entities, including those organized with the aim of achieving a social objective (Frumkin, 2002). Obtaining these resources is particularly difficult due to the liability of newness, which must be overcome by establishing legitimacy from potential contributors’ viewpoints, including employees, suppliers, and, either investors. For many social entities, resource providers also include grant-making organizations and donors (Singh, Tucker, & House, 1986). Yet “there has been limited empirical examination of the approaches used by social ventures to mobilize critical resources” (Desa & Basu, 2013). Our study demonstrates that an organization’s ability to attract resources is affected by conformity with an evolving categorization of entities and establishment of moral and pragmatic legitimacy with potential resource providers (Dart, 2004; Miller, Grimes, McMullen & Vogus, 2012).

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