Transformational Entrepreneurship Practices: Global Case Studies [1st ed.] 978-3-030-11523-4;978-3-030-11524-1

Table of contents :
Front Matter ....Pages i-xv
The Journey to Transformational Entrepreneurship (Gideon Maas, Paul Jones, Joan Lockyer)....Pages 1-14
Innovation and Entrepreneurial Ecosystems as Important Building Blocks (Zimu Xu, Gideon Maas)....Pages 15-32
Case Study: Transformational Entrepreneurship in the UK—“From UK Bread Waste to Global Beer Brand” (Rebecca Connolly)....Pages 33-54
Case Study: Gender and Enterprise Development in Africa (Keren Naa Abeka Arthur)....Pages 55-68
Case Study: Transformational Entrepreneurship in Australia (Heather Round)....Pages 69-87
Case Study: Transformational Entrepreneurship in Malaysia—Dare to Dream, Dare to Talk, Dare to Act(ion) (Sok Kwan Say, Kii Geat Johan Lim)....Pages 89-104
Conclusions on Transformational Entrepreneurship (Paul Jones, Gideon Maas)....Pages 105-113
Back Matter ....Pages 115-118

Citation preview

Transformational Entrepreneurship Practices Global Case Studies Edited by Gideon Maas Paul Jones

Transformational Entrepreneurship Practices

Gideon Maas  •  Paul Jones Editors

Transformational Entrepreneurship Practices Global Case Studies

Editors Gideon Maas International Centre for Transformational Entrepreneurship Coventry University Coventry, UK

Paul Jones School of Management Swansea University Swansea, UK

ISBN 978-3-030-11523-4    ISBN 978-3-030-11524-1 (eBook) https://doi.org/10.1007/978-3-030-11524-1 Library of Congress Control Number: 2019935189 © The Editor(s) (if applicable) and The Author(s) 2019 This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, express or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. Cover illustration: Pattern © Harvey Loake This Palgrave Pivot imprint is published by the registered company Springer Nature Switzerland AG. The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland

Preface

We set out to edit three books on the theme of transformational entrepreneurship, and in this third book the focus is on global case studies illustrating transformational entrepreneurship in a practical manner. In our first book (Systemic Entrepreneurship—Contemporary Issues and Case Studies, 2015), the focus was on providing a broad overview of systemic (transformational) entrepreneurship. That book addressed the issues of low and slow socio-economic growth patterns and how a transformational approach can address this dilemma. It was highlighted that systemic entrepreneurship is about enabling change to how entrepreneurs and society act beyond local levels of entrepreneurial engagement. Our second book (Entrepreneurship Centres—Global Perspectives on Their Contributions to Higher Education Institutions, 2017) used the first book as basis and explores how entrepreneurship centres can act as the kingpin within universities to stimulate transformational entrepreneurship. It is well known that entrepreneurship centres are the key leaders in universities, stimulating enterprise and entrepreneurial activities. However, these important centres experience various challenges that sometime cloud their focus and activities. This third book focuses on taking this conversation about transformational entrepreneurial practices further and adds global case studies to illustrate the concept. Case studies are from the UK, Malaysia, and Africa. In order to allow interpretation of the case studies by readers, this book v

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firstly provides an updated overview of transformational entrepreneurship in Chap. 1. In Chap. 2, the important issue of innovation and innovative ecosystems are discussed, forming one of the most important pillars of transformational entrepreneurship. Chapter 3 provides a case study about a social enterprise in the UK, followed by a case study in Africa in Chap. 4. Chapter 5 focuses on a case study from Australia, and Chap. 6 highlights a case from Malaysia. Chapter 7 focuses on concluding remarks on the way forward for transformational entrepreneurship. These case studies highlight different issues pertaining to transformational entrepreneurship, illustrating that there is not a one-system-fits-all case within this concept. Principles should be interpreted and contextualised to add value within countries and specific regions in those countries. In this book the main message is that transformational entrepreneurship is not a static concept, but should be regarded as a journey over time influenced by a magnitude of factors often not imaginable. This book is a further step in developing deeper thoughts and knowledge about transformational entrepreneurship and through that the authors attempt to set the direction for renewed research and development into the future. Coventry, UK  Swansea, UK

Gideon Maas Paul Jones

Acknowledgements

Many people made this book possible. Firstly, the editors want to thank the leadership team of Coventry University, who created the freedom and innovative space for the editors to explore principles and practices of transformational entrepreneurship. The home created for this process, the International Centre for Transformational Entrepreneurship, is certainly going from strength to strength in this regard. Discussions among the staff of this centre further contributed to the knowledge captured in this book. Secondly, the editors want to thank the various contributors of the cases, who are all noted individually within the ‘Notes on Contributors’ section. Lastly, thanks are due to Palgrave Macmillan, who are undertaking this creative journey with us—we need more institutions like that!

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Contents

1 The Journey to Transformational Entrepreneurship  1 Gideon Maas, Paul Jones, and Joan Lockyer 2 Innovation and Entrepreneurial Ecosystems as Important Building Blocks 15 Zimu Xu and Gideon Maas 3 Case Study: Transformational Entrepreneurship in the UK—“From UK Bread Waste to Global Beer Brand” 33 Rebecca Connolly 4 Case Study: Gender and Enterprise Development in Africa 55 Keren Naa Abeka Arthur 5 Case Study: Transformational Entrepreneurship in Australia 69 Heather Round

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6 Case Study: Transformational Entrepreneurship in Malaysia—Dare to Dream, Dare to Talk, Dare to Act(ion) 89 Sok Kwan Say and Kii Geat Johan Lim 7 Conclusions on Transformational Entrepreneurship105 Paul Jones and Gideon Maas Index 115

Notes on Contributors

Keren  Naa  Abeka  Arthur  is Lecturer in Entrepreneurship at the Centre for Entrepreneurship and Small Enterprise Development at the University of Cape Coast, Ghana. She holds a PhD and an MBA in Entrepreneurship and Innovation from the University of Exeter Business School, UK.  Prior to her graduate studies, she pursued a bachelor’s degree in Business Administration at Ashesi University, Ghana. She has over five years of teaching and research experience, with extensive international exposure. Her research interests are in responsible innovation, innovation management and governance, transformational entrepreneurship and small- and medium-sized enterprise (SME) development. Her work is multidisciplinary and includes studies on the responsible emergence of financial innovation, responsible innovation in the global South, entrepreneurship education and training in religious institutions, sustainable business practices within SMEs in the sachet water industry, and loan repayment and capital formation in SMEs among others. Rebecca  Connolly is a research assistant at the International Centre for Transformational Entrepreneurship at Coventry University. Connolly completed a master’s degree in Cross-Cultural Communication and International Relations at Newcastle University, following which she spent two years working on projects focused on education and entrepreneurship in Ghana and Sierra Leone. Connolly has also worked in entrepreneurial development roles at Newcastle University and the School for Social Entrepreneurs. Connolly is conducting research into the role social entrepreneurship plays in creating social transformation in the UK, Ghana, and South Africa for her PhD project. xi

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Notes on Contributors

Paul  Jones is Professor of Entrepreneurship and Innovation at Swansea University. He has worked in further and higher education for over 25 years and is an active researcher in the entrepreneurship and small business management discipline. His articles have been published widely in leading journals in the field. He is the Editor-in-Chief of the International Journal of Entrepreneurial Behaviour and Research and Associate Editor of the International Journal of Management Education. In addition, he has also acted as a guest editor for several special issues exploring entrepreneurial activity. He is a visiting professor at Coventry University, Anglia Ruskin, Manchester Metropolitan and the University of South Wales. He is also a senior fellow of the Higher Education Academy. Kii  Geat  Johan  Lim  is Associate Dean of Management Department at the Faculty of Accountancy, Finance and Business, Tunku Abdul Rahman University College, Malaysia. He is a member of the Chartered Institute of Logistics and Transport, Malaysia. He also holds an MSc (International Business Management) from the University of Nottingham. His teaching interests include case-study analysis, international business environment, and entrepreneurship. His primary specialisation is in case analysis, supply chain innovation, and strategic business positioning. In addition, he holds special interest in mentoring students for business case competition and career development. Joan  Lockyer is Acting Deputy Director, International Centre for Transformational Entrepreneurship (ICTE) at Coventry University. Formed in 2015, the Centre evolved from the Institute of Applied Entrepreneurship (IAE). Lockyer joined the IAE in 2009 and transferred to ICTE in 2015, maintaining responsibility for the development and delivery of its academic programmes. Lockyer has worked in higher education for 17 years, prior to which she worked in industry (in product development, testing, and ­certification) for over 10 years and in consultancy for 12 years. Her teaching experience covers the full spectrum of accredited and non-accredited programmes (undergraduate, postgraduate to doctoral level, professional development and vocational). She is experienced in enterprise education, leading on the development of the Master’s in Enterprise and Entrepreneurship Education and co-delivering the International Enterprise Educators Programme. She has developed a range of modules that support enterprise and entrepreneurship skills development in undergraduates, regardless of discipline. She has successfully delivered/contributed to a number of European projects, with a total value of over 5 million Euros.

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Gideon  Maas  is Director of the International Centre for Transformational Entrepreneurship and Professor of Professional Practice at Coventry University, UK. Maas has broad international business and academic experiences in various countries. Within the academic environment, Maas has created various entrepreneurship centres at different universities over the past years, developed and implemented undergraduate and postgraduate modules and programmes focusing specifically on enterprise and entrepreneurship. Maas has also created the African Institute for Transformational Entrepreneurship and the South-East Asia Institute for Transformational Entrepreneurship to facilitate conversations supporting sustainable socio-economic growth. Maas’s research focus and experiences are in entrepreneurship, open innovation, growth strategies, entrepreneurial universities, implementation of entrepreneurial systems, and family businesses. His research activities are industry and academic related, and he has published various books and articles in the public domain. Maas is also an extraordinary professor at Stellenbosch University, South Africa, and an adjunct scientific fellow at the Munster University of Applied Sciences, Germany. Lastly, Maas is President of the Board of Trustees of the Institute of Small Business and Entrepreneurship. Heather Round  is a lecturer at Deakin Business School, Melbourne, Australia, and Director of Innovation and Entrepreneurship at the Faculty of Business and Law. She holds an MBA from the Graduate School of Business, Cape Town, South Africa, and a PhD in Creativity from Melbourne University. Round’s research interests lie in the area of entrepreneurship, creativity, and innovation. Prior to becoming an academic, Round worked on large-scale, technology-­ intensive, organisational change projects within public and private corporations in the UK, Australia, New Zealand, and South Africa. Sok Kwan Say  is Vice President in charge of administration and internationalisation, Tunku Abdul Rahman University College, Malaysia. Her previous roles at the University College include the vice president in charge of collaboration, innovation, and entrepreneurship, and the head of the business school. Her experiences in entrepreneurship include assisting the University College in setting up an incubation centre, organising programmes to promote entrepreneurship, and collaborating with industries, institutions of higher learning, and other organisations in entrepreneurship-related areas. She is a member of the Chartered Institute of Management Accountants, UK. She also holds an MBA from the University of Leicester, UK.

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Notes on Contributors

Zimu  Xu works as a research assistant at the International Centre for Transformational Entrepreneurship at Coventry University. Alongside her work, she is also on a PhD programme, looking at influencing factors of business growth in the UK digital gaming industry. After graduating with a BSc MORSE (Mathematics, Operational Research, Statistics and Economics) degree from the University of Warwick, Xu stayed on and obtained an MSc degree in Innovation and Entrepreneurship. While working collaboratively with senior colleagues on a range of research projects, Xu is particularly interested in the creative and technology sector. Outside work, Xu enjoys outdoor sketching, traditional Chinese painting, and calligraphy.

Abbreviations

EU GDP GEM HE HEI ICTE MSE NGO OECD QAA SME TE TEA UK

European Union Gross Domestic Product Global Entrepreneurship Monitor Higher Education Higher Education Institutions International Centre for Transformational Entrepreneurship Micro and Small Enterprises Non-Governmental Organisation Organisation for Economic Co-operation and Development Quality Assurance Agency Small- and Medium-Sized Enterprises Transformational Enterprises Total Early-Stage Entrepreneurial Activity United Kingdom

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1 The Journey to Transformational Entrepreneurship Gideon Maas, Paul Jones, and Joan Lockyer

Abstract  A need exists for renewed thinking to stimulate entrepreneurship to support socio-economic growth. Within this context, “transformational entrepreneurship” refers to a holistic and heuristic orientation in terms of entrepreneurship promotion and combines the individual and other sub-systems (such as society and institutions) interacting and collaborating to create a positive framework in which opportunities can be exploited beyond the local level. Keywords  Enterprise • Entrepreneurship • Transformational entrepreneurship • Ecosystem

G. Maas (*) • J. Lockyer Coventry University, Coventry, UK e-mail: [email protected]; [email protected] P. Jones Swansea University, Swansea, UK e-mail: [email protected] © The Author(s) 2019 G. Maas, P. Jones (eds.), Transformational Entrepreneurship Practices, https://doi.org/10.1007/978-3-030-11524-1_1

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1.1 Introduction The global environment is characterised by various phenomena which the National Intelligence Council (2017) has summarised as follows: the rich are aging, the poor are not; weak economic growth will persist in the near term; technology is accelerating progress but causing discontinuities; growing global connectivity amid weak growth will increase tensions within and between societies; governing is getting harder; risk of conflict will increase due to diverging interests among major powers, an expanding terror threat, continued instability in weak states and the spread of lethal, disruptive technologies; and climate change, environment and health issues will demand attention. Entrepreneurs and stakeholders supporting entrepreneurs find themselves in the midst of these phenomena, and it is expected that they collectively work together to stimulate sustainable socio-economic development. The role and importance of entrepreneurship creating sustainable socio-economic development are not questioned—rather, it is questioned whether the current landscape possesses the right capability, capacity, ecosystems and policies to transform or maintain progressive socio-economic landscapes. A plethora of initiatives supporting entrepreneurship exists. However, Sautet (2013) and Maas and Jones (2015) concur that although entrepreneurship is socially productive, it struggles to address major challenges such as those identified by the National Intelligence Council (2017). Thus a new approach to the development of socio-economic development is required—a systemic process that is more heuristic and holistic in nature to accommodate both individualistic and societal needs. Without such a new approach, that is, transformational entrepreneurship, the potential for socio-economic development will remain limited and only benefit a minority of individuals, businesses and nations. Within such a transformation there are more questions than answers. Do we base decision-making on historical data or do we dare to be more futuristic in our entrepreneurial solutions? Do we focus on the right type of innovation or are we merely “me-too” orientated where everyone is doing the same? Are we enlarging the existing “economic cake” or are we dividing it into smaller pieces, which makes sustainable socio-economic

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development difficult? Do we have the right capability, capacity, ­ecosystems and policies to manage the current and future environment successfully? It is the premise of this book that all existing approaches stimulating entrepreneurship should be investigated—those practices that are relevant should be continued and those outdated should be replaced by current and futuristic solutions. Built on the basis of theoretical principles associated with transformational entrepreneurship and ecosystems, practical cases are provided to illustrate the concept of transformational entrepreneurship globally. Finally, transformational entrepreneurship is not focusing on subsistence entrepreneurs or people who are regarded as lifestyle entrepreneurs. In addition, it needs to be highlighted that there is nothing wrong being a subsistence or lifestyle business owner. However, transformational entrepreneurship is focusing on stimulating socio-­ economic development in a dynamic manner. Schoar (2010: 58) agrees with this distinction between subsistence and transformational entrepreneurs, indicating that transformational entrepreneurs “are those who aim to create large, vibrant businesses that grow much beyond the scope of an individual’s subsistence needs and provide jobs and income for others”.

1.2 Definitions Various definitions exist for terminologies used in this chapter. However, it is not the intention of this chapter to debate different definitions or explore why a specific definition was selected over another. The definitions below are sufficient to support the core concepts that will be discussed in this chapter: • Enterprise: The Quality Assurance Agency (QAA 2018: 7) defines enterprise as: “Enterprise is defined here as the generation and application of ideas, which are set within practical situations during a project or undertaking. This is a generic concept that can be applied across all areas of education and professional life.” • Entrepreneurship: The QAA (2018: 7) defines entrepreneurship as: “Entrepreneurship is defined as the application of enterprise behaviours,

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attributes and competencies into the creation of cultural, social or economic value. This can, but does not exclusively, lead to venture creation.” Innovation involves the utilisation of ideas in problem solving by developing processes and improving the way things are done by creating new products, services, processes and organisations (Dawson and Andriopoulos 2014). The entrepreneurial ecosystem is a network of interconnected actors which formally and informally coalesce to connect, mediate and govern the performance within the local entrepreneurial environment (Mason and Brown 2013). Holistic approaches recognise the interconnectedness of people and the environment and look to support continuous adaptation, transformation and coordination through a process of change and evolution (Best 2011; Wapner and Demick 2003). A heuristic orientation refers to the process by which individuals make decisions in conditions of uncertainty. The value of a heuristic approach is that decisions are made. The downside is that decisions are limited and the options are circumscribed by the limits of time, knowledge and information. How decisions are made is a function of social, cultural and individual rationality (Gigerenzer 2010). Socio-economic growth is a process that seeks to identify both the social and the economic requirements within a community and looks to create strategies that address those needs in ways that are practical and in the optimum interests of the community over the long term (Jaffee 1998). Systemic entrepreneurship involves sub-systems interacting and collaborating to create a positive framework in which opportunities can be exploited; it should be socially productive and go beyond the local level (Sautet 2013).

Based on the above definitions and discussions following this paragraph, transformational entrepreneurship is defined by the authors of this chapter as follows: Transformational entrepreneurship is to promote enterprise and entrepreneurship through a systemic approach, bringing about transformation in socio-economic development. There are four areas in this definition, namely:

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• It represents a broad area of activity—the enterprising area, which should be applicable to all areas of work. • It represents a focused area—entrepreneurship, which represents the “doing” part of the definition. • A systemic approach referring to a holistic approach. • Transformation in socio-economic development representing an optimal balance between economic and societal development.

1.3 Transformational Entrepreneurship There is a general consensus that entrepreneurship can and should play an important role in socio-economic development (Ács et al. 2014; COM 2012; Cooney 2012). Moreover, it is pointed out that entrepreneurial activity which focuses predominantly on the individual entrepreneur or local region will probably not have the desired positive impact on national socio-economic development hoped for (Ács et  al. 2014; COM 2012; Cooney 2012). A balance should be struck between a focus on individual entrepreneurial activities and society-wide changes, which may have a more positive impact on socio-economic growth. This shift in thinking from individual to country-wide conceptualisations of entrepreneurship is not without its difficulties; however, the step is an important one if policy-makers are to be persuaded of the economic contribution of entrepreneurship. Ács et al. (2014) argue that society- or even country-level entrepreneurial measurements have never previously received adequate attention. In order to address global phenomena such as poverty, unemployment, and low or no growth, transformation is required in the way entrepreneurship is supported as part of a total system, that is, a system consisting of individuals, the community, public sector, private sector and natural resources. Two important concepts can be identified from the previous paragraph, namely, systemic and transformational entrepreneurship. According to Ács et  al. (2014: 477) the term “system” “constitutes of multiple components that work together to produce system performance”. Ács et al. (2014) further illustrate that it is not implicit that the sub-components of a system are in perfect harmony with each other.

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There might be weaknesses in the system, which require specific attention to restore the balance of the total system. However, the world is experiencing a complex system, brought about by various factors such as the global phenomenon factors discussed previously, which provide challenges to decision-makers. In this regard, Madelin and Ringrose (2016: 18) defines a complex system where “no one can have a complete map of the actors and forces at play, the system’s behaviour is not simply the sum of the behaviour of those parts, feedback loops surprise us and change the behaviour of the system, the system is ‘autopoietic’: behaving in a self-driven way and not just in ways we have yet to understand”. Within this context “systemic entrepreneurship” refers to a broader orientation in terms of entrepreneurship promotion and combines the individual and other subsystems such as society and institutions interacting and collaborating to create a positive framework in which opportunities can be exploited. In order to have a positive impact on socio-economic growth, systemic entrepreneurship should be socially productive (it should be legal) and go beyond the local level (Sautet 2013: 393). This approach emphasises the need for holistic thinking and, in essence, moves the concept of the entrepreneur from the individual to the context in which the individual is situated, that is, to society more generally. This approach is not arguing against the existence of locally focused entrepreneurial activities, micro enterprises or subsistence enterprises; to the contrary, they are important for cascading wealth to the broader society. However, if not enough focus is put on systemic entrepreneurial activities (activities that go beyond local levels), socio-economic growth can be under pressure to create wealth in a country. Re-thinking the way entrepreneurship is promoted is therefore called for and the focus of this drive is systemic, which can lead to transformational results. In terms of the latter, Miller and Collier (2010: 85) define transformational entrepreneurship “as the creation of an innovative virtue-based organization for the purpose of shifting resources out of an area of lower and into an area of higher purpose and greater value under conditions requiring an holistic perspective. Transformational Entrepreneurship transcends economic terms and emphasizes the centrality and value of people, their vocations, and the many levels of relationality involved in entrepreneurship, in addition to the technical aspects of the business.” Marmer (2012) agrees with this definition and states that a

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c­ ombination between technology entrepreneurship and social entrepreneurship is desired to address the current stalemate in terms of global socio-­economic growth. Within the transformational entrepreneurship domain, the focus is on researching and finding improved ways to address current and future challenges and to create a holistic and heuristic approach which can form a sound basis for socio-economic growth in the future. To bring about effective transformation, it is important to evaluate and challenge, when necessary, the heuristics upon which decisions are currently made. The danger of real-time, tried-and-tested solutions (default heuristic) is that they can be short term and policy driven. New approaches need to be devised that challenge default reactions and create new frameworks for adaptive thinking. These new ways should ultimately find their way through to policies that can guide current and future socioeconomic development. Within an environment that is characterised by short-term orientations (e.g. according to the length between political elections), policies are often equally short term and out of sync with global phenomenon. If one argues that the total entrepreneurship ecosystem should transform in order to address current and future phenomenon in a constructive manner, creating and maintaining sustainable socio-economic growth, it is evident from a transformational perspective that a holistic and (adaptive) heuristic approach should be followed. Roth and DiBella (2015: 7) state that “Systemic change encompasses the enterprise, the larger set or system of organizations that depend upon each other and make improvements in ways that produce enduring rather than ephemeral value.” Mason and Brown (in OECD and the Government of the Netherlands 2013: 1) agree with the notion that an ecosystem is a network of interconnected actors “which formally and informally coalesce to connect, mediate, and govern the performance within the local entrepreneurial environment”. Within this ecosystem context (see a more detailed discussion of this ecosystem in Chap. 2), for example, universities cannot change their entrepreneurship education and support practices in isolation and need to take other sub-systems (i.e. role-players such as industry) into consideration when making changes. Therefore, entrepreneurial development cannot act in isolation—it is a networked approach of different role-players.

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1.4 Encouraging Transformational Entrepreneurship Taking into consideration the dynamic nature of the global environment and the changing nature of systems operating in this environment, the diverse nature of cultures, economic sectors and the rate of innovation, encouraging transformational entrepreneurship is by no means an easy task. In many cases old habits need to be unlearned first before new ones can be created. Turner (2018) and Rugeruza (2017) add to this debate of promoting transformational entrepreneurship, indicating firstly that traits commonly associated with transformational entrepreneurship include factors such as having a futuristic and sometimes disruptive dream. Other factors highlighted by Turner (2018) and Rugeruza (2017) include realising the importance of building a strong team (disruptors work best when they work together); the importance of knowledge; not being afraid to break conventional wisdom to keep their business fresh, persistent and courageous; realising that products/services can be copied but not strategic alliances (team work is essential); and defining success for their own situations that might not be the norm in similar industries. Roth and DiBella (2015) further argue that five capabilities are required to enable transformational change, namely, enterprise awareness (e.g. knowledge of the total industry in which one operates), innovation, balancing push (e.g. actions from management side) and pull factors (e.g. new knowledge obtained by employees) of change, and seeking growth and leadership. Enterprise awareness calls for a clear perspective on who the role-players are within a specific context such as entrepreneurship education and support. Individual role-players need to think beyond their own individual systems and create sound relationships among autonomous units within the larger system. In order to affect change, people need to acquire and practice new approaches, which can be on multiple levels at the same time. Balancing change will consist of push change (managers making plans for change) and pull change (people implementing what they have learned). New knowledge is therefore essential for innovation and the total process of change. This process

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should challenge the validity of accepted solutions for given problems and lead to new heuristics as guiding principles for more adaptive decision-­ making. Within a global fast-changing environment growth is essential for sustained success and continued improvement. Creating aspirations among people through learning and applying new knowledge is a sound basis for such growth. Transformation in socio-economic development cannot occur if everything is held stable. By creating more businesses one should also focus on growing the economic potential, otherwise the economic potential is only sub-divided into smaller pieces, which is debatable that it can improve issues such as wealth and an equal distribution of income. The OECD (2018: 5) indicated in this regard that assisting entrepreneurs to scale up “can help countries address low productivity growth and widening income gaps, since SMEs that grow have a considerable impact on competition, innovation, employment and wages”. Roth and DiBella (2015) further indicate that sound leadership is required to implement changes on multiple levels on a continuous basis. Within an innovative society (where new knowledge creates new innovations) leaders need to hold their own and accelerate at the same time quite often just to maintain their current market share. Changes are not the prerogative of a specific area only; they often happen on multiple levels, both internally and externally to the organisation. In such an environment, leadership and entrepreneurship need to combine to stimulate innovative thinking, allowing the exploitation of new opportunities on a continuous basis. In this regard, Eyal and Kark (2004: 215) indicate that “leadership and entrepreneurship overlap to some degree, leadership involves influencing subjects’ symbolic realm in order to move them towards certain actions and determining the time and scope of these actions whereas entrepreneurship represents the operational translation of symbols and behaviours into actions”. It can be argued that leaders need to create compelling narratives in terms of entrepreneurship development (or intrapreneurship development within larger institutions). These narratives are needed to create growth opportunities. The current dominant focus on cost-efficiency might blind leaders from being more opportunity orientated. Roth and DiBella (2015: 39) agree that “in a competitive environment success comes not from efficient systems but from those with the capacity to

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grow”. Linear models cannot provide optimal solutions anymore. In this regard, Philpott et al. (2011: 161) argue that “historical accepted linear models are now being surpassed by the contemporary and dominant view that innovation is most appropriately perceived as a systemic, networked phenomenon”. A further dimension is added by Knickel et al. (2009), who refer to first- and second-order innovation. First-order innovation focuses on limited changes, and second-order innovation on system changes, which necessitates that existing assumptions, beliefs and values can only be challenged through second-order innovation. When second-­ order innovation is successful, it can act as the breeding ground for first-­ order innovation. Innovation should be moving away from predominant linear training for innovation (what, how and when) to a more explorative approach focusing on process questions such as “why not” or/and “what if ”. Such innovation will go beyond incremental innovation and focus on transforming relationships and interactions between industry, competitors and people’s behaviours and lifestyles. The existence of entrepreneurs, leaders, innovation and an entrepreneurial ecosystem is by no means a guarantee that socio-economic development will be positively stimulated. These focus areas can create a positive environment for transformational entrepreneurship to flourish, but can equally be a major stumbling block when policies are not supportive of such an environment or when policy-makers simply rely on the past to predict the future. It can be argued that an overly reliance on the provision of grants and subsidies may influence the creation of entrepreneurial mind-sets negatively, that is, it creates a dependency culture. Policies influencing the entrepreneurial ecosystem should be investigated and tweaked, or in some cases radically changed, to support the entrepreneurial ecosystem. Therefore, a careful analysis of the total eco­system is required which can guide finding optimal solutions for the current and future challenges facing socio-economic growth.

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1.5 Applying Transformational Entrepreneurship The question that remains to be addressed is how to go about implementing transformational entrepreneurship? Transformational entrepreneurship focuses more on the future than the present or the past—without neglecting the present. Various methods can be used to achieve a more structured approach implementing transformational entrepreneurship and one such way is by utilising the conceptual model of Marmer (2012) (see Fig. 1.1). In Fig. 1.1, it is clear that transformational entrepreneurship addresses socio-economic development—see vertical and horizontal axes. An illustration of how the International Centre for Transformational Entrepreneurship (ICTE) at Coventry University addresses the promotion of transformational entrepreneurship based on the Marmer (2012) model might assist in understanding transformational entrepreneurship better. The following applies to ICTE: • Entrepreneurship education: Curriculum is adapted to address transformational entrepreneurial criteria such as personal development as an entrepreneur, applying second-order innovation and understanding the business/industry in which students operate. Curriculum is adapted on a continuous basis to stay in a floating equilibrium with environmental changes.

Fig. 1.1  Transformational entrepreneurship (Source: Adapted from Marmer 2012)

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• Research: Doctorate and project research focuses on critical topics within specific environments such as the role of crowdfunding, development of entrepreneurial ecosystems within specific regions and improving the transformational role of social businesses. • Continuous improvement: Continuous improvements are discussed annually on think tanks, where the focus is on future solutions. These think tanks (can also be labelled as open entrepreneurial laboratories) are held around the world and are currently growing in support from leading entrepreneurial thinkers around the world. • Business model: ICTE’s business model was changed from a predominant product/service orientation to a platform model, that is, platforms (e.g. think tanks) are organised around the world which also act as the basis to accelerate the understanding and support for transformational entrepreneurship. Above is only one way that the implementation of transformational principles is addressed. Each institution should develop their own contextualised way of implementing transformational entrepreneurship. From experience, the easiest manner is to develop a very simplistic system as point of departure and improve that continuously over time as capacity and capability in the institutions grow over time.

1.6 Conclusion The global and even local changes make it difficult to treat entrepreneurs as a homogeneous group of actors that are uniformly affected by economic conditions or policy interventions. Dedicated support for specific groups or institutions need to be developed. This support should focus on innovative thinking on how enterprise and entrepreneurship can support socio-economic growth in the local, regional, national and international environment. Current challenges within the environment indicate that novel approaches are required to address these challenges and find sustainable solutions. In the rest of the chapters cases are presented on how such transformational entrepreneurial practices are adapted in different parts of the world.

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An essential part of potential solutions is the part innovation is playing. Therefore, Chap. 2 will focus on innovation expanding the understanding of transformational entrepreneurship.

References Ács, Z. J., Autio, E., & Szerb, L. (2014). National Systems of Entrepreneurship: Measurement Issues and Policy Implications. Research Policy, 43, 476–494. Best, K. C. (2011, Winter/Spring). Holistic Leadership: A Model for Leader-­ Member Engagement and Development. The Journal of Value-Based Leadership, 4(1), Article 5. Retrieved from https://scholar.valpo.edu/jvbl/ vol4/iss1/5. COM. (2012). European Commission: ‘Entrepreneurship 2020 Action Plan’ (2012) (COM(2012) 795 Final). Retrieved from http://eur-lex.europa.eu/ LexUriServ/LexUriServ.do?uri=COM:2012:0795:FIN:en:PDF. Cooney, T. M. (2012, November). Entrepreneurship Skills for Growth-Orientated Businesses. Danish Business Authority. Retrieved from http://www.oecd.org/ cfe/leed/Cooney_entrepreneurship_skills_HGF.pdf. Dawson, P., & Andriopoulos, C. (2014). Managing Change, Creativity and Innovation (2nd ed.). London: Sage Publication. Eyal, O., & Kark, R. (2004). How Do Transformational Leaders Transform Organizations? A Study of the Relationship Between Leadership and Entrepreneurship. Leadership and Policy in Schools, 3(3), 211–235. Gigerenzer, G. (2010). Moral Satisficing: Rethinking Moral Behavior as Bounded Rationality. Topics in Cognitive Science, 2(3), 528–554. https://doi. org/10.1111/j.1756-8765.2010.01094.x. Jaffee, D. (1998). Levels of Socio-economic Development Theory. London: Praeger. Knickel, K., Brunori, G., Rand, S., & Proost, J.  (2009). Towards a Better Conceptual Framework for Innovation Processes in Agriculture and Rural Development: From Linear Models to Systemic Approaches. Journal of Agricultural Education and Extension, 15(2), 131–146. Maas, G. J. P., & Jones, P. (2015). Systemic Entrepreneurship: Contemporary Issues and Case Studies. London: Palgrave Publishing. Madelin, R., & Ringrose, D. (2016). Opportunity Now: Europe’s Mission to Innovate. The Publications Office of the European Union. Marmer, M. (2012, April 23). Transformational Entrepreneurship: Where Technology Meets Societal Impact. Harvard Business Review. Retrieved from https://hbr.org/2012/04/transformational-entrepreneurs.

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Mason, C., & Brown, R. (2013, November 7). Entrepreneurial Ecosystems and Growth Oriented Entrepreneurship. Paper prepared for the OECD LEED Programme and Dutch Ministry of Economic Affairs, The Hague, Netherlands. Miller, R. A., & Collier, E. W. (2010). Redefining Entrepreneurship: A Virtues and Values Perspective. Journal of Leadership, Accountability and Ethics, 8(2), 80–89. National Intelligence Council. (2017, January). Global Trends  – Paradox of Progress. Retrieved from www.dni.gov/nic/globaltrends. OECD. (2018, February 22–23). Enabling SMEs to Scale Up. Discussion Paper. SME Ministerial Conference, Mexico City. OECD and the Government of the Netherlands. (2013, November 7). Entrepreneurial Ecosystems and Growth-Orientated Entrepreneurship  – Summary Report of an International Workshop. The Hague. Philpott, K., Dooley, L., O’Reilly, C., & Lupton, G. (2011). The Entrepreneurial University: Examining the Underlying Academic Tensions. Technovation, 31, 161–170. QAA. (2018, January). Enterprise and Entrepreneurship Education: Guidance for UK Higher Education Providers. London: The Quality Assurance Agency for Higher Education. Roth, G. L., & DiBella, A. J. (2015). Systemic Change Management – The Five Capabilities for Improving Enterprises. New York: Palgrave Macmillan. Rugeruza, A. (2017, February 22). 4 Distinct Traits of Transformational Entrepreneurs. Retrieved from http://iroikos.co.uk/4-distinct-traits-transformational-entrepreneurs/. Sautet, F. (2013). Local and Systemic Entrepreneurship: Solving the Puzzle of Entrepreneurship and Economic Development. Entrepreneurship Theory and Practice, 37(2), 387–402. Schoar, A. (2010). The Divide Between Subsistence and Transformational Entrepreneurship. National Bureau of Economic Research, pp.  57–81. Retrieved from http://www.nber.org/chapters/c11765. Turner, S. (2018, February 9). 5 Traits of Transformational Entrepreneurs. Retrieved from http://www.cose.org. Wapner, S., & Demick, J.  (2003). Adult Development: The Holistic, Developmental and Systems-Oriented Perspective. In J.  Demick & C. Andreotti (Eds.), Handbook of Adult Development (pp. 66–83). New York, NY: Kluwer Academic/Plenum Publishers. Cited in Best, K.  C. (2011). Holistic Leadership: A Model for Leader-Member Engagement and Development. The Journal of Value Based Leadership, 4 (Winter/Spring).

2 Innovation and Entrepreneurial Ecosystems as Important Building Blocks Zimu Xu and Gideon Maas

Abstract  Transformational entrepreneurship enables social-economic development. It goes beyond just focusing on economic returns and stresses the importance of people and the multi-level connectivity in the entire entrepreneurial process. In order to achieve the transformational purpose, entrepreneurship and second-order innovation, which is often disruptive in nature, are key in the process, as such activities can subsequently maximise the chances of successful transformational ventures. To nurture such innovation and entrepreneurial activities, a supportive environment is crucial. Extant literature suggests that such an environment is linked to two existing concepts: innovation and entrepreneurial ecosystems. Thus, this chapter investigates the two ecosystem concepts and highlights the differences between the two. As well as they are different, the two ecosystems are not mutually exclusive. Acknowledging the importance of such ecosystems, key principles are followed in building sound ecosystems that can best support transformational entrepreneurship.

Z. Xu (*) • G. Maas Coventry University, Coventry, UK e-mail: [email protected]; [email protected] © The Author(s) 2019 G. Maas, P. Jones (eds.), Transformational Entrepreneurship Practices, https://doi.org/10.1007/978-3-030-11524-1_2

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Keywords  Innovation • Ecosystem • Entrepreneurship • First-order innovation • Second-order innovation

2.1 Introduction Extant literature indicates that there is general agreement that one of the important traits of entrepreneurs is their ability to innovate (Kirby 2003; Van der Sijde et  al. 2004; Burns 2007). Furthermore, innovation has been recognised as one of the most important factors in fostering growth at the macroeconomic level (Mazzucato and Parris 2013). The process of bringing an idea to commercialisation involves numerous parties, and the creation of entrepreneurial and innovation ecosystems has been considered to be an effective way to nurture and support this process (Rabelo and Bernus 2015). In terms of innovation, there are various classifications of innovation. However, within the context of transformational entrepreneurship, the classification of innovation into first- or second-­ order innovation is of specific relevance (Knickel et al. 2009). According to Knickel et al. (2009), first-order innovation is incremental and often involves a linear process towards product or service innovation, whilst second-order innovation is often disruptive and involves business model innovation. The development of second-order business model innovation is usually network based, which implies a much more complex process and involves various actors. The ecosystem concept emerged as a direct consequent of this complexity and to effectively support this complex process (Adner 2006; Frenkel and Maital 2014). The term ecosystem was first introduced in biology and, at a later stage, adopted and used widely in fields such as economics and business (Willis 1994, 1997; Peltoniemi 2005). When analysing components of the biological and ecological concepts and applying them to a social science context, various ecosystem analogies emerge such as industrial ecosystem, business ecosystem, innovation ecosystem and entrepreneurship ecosystem (Frosch and Gallopoulos 1989; Korhonen et al. 2001; Moore 1993; Peltoniemi 2005; Pilinkienė and Mačiulis 2014). In particular, entrepreneurial and innovation ecosystems are perceived to be closely related to

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innovation and have much higher concentrations on nurturing high-­ impact activities. Within this context, this chapter first investigates the differences between the two ecosystems and then discusses key principles of building sound entrepreneurial ecosystems that can assist transformational entrepreneurship.

2.2 Entrepreneurial and Innovation Ecosystems The concepts of innovation and entrepreneurial ecosystems started to appear formally in literature around the same time in the late 1990s and both concepts rapidly gained popularity in the recent decade. Entrepreneurial ecosystems have evolved from the changing debate on entrepreneurship. In searching for ways to explain entrepreneurship and entrepreneurial activities, the personality approach started to be challenged and scholars began to recognise the importance of the broader environment that entrepreneurs or their ventures are located within (Dodd and Anderson 2007; Spigel and Harrison 2018). Early contributions established initial frameworks on how socio-cultural, economic and political environment can nurture and influence entrepreneurs and their ventures (Neck et al. 2004; Spigel and Harrison 2018). One of the most influential publications, which has driven the popularity of the concept, was Daniel Isenberg’s (2010) seminal work The Big Idea: How to start an Entrepreneurial Revolution. Books such as Startup Communities by Brad Feld’s (2012) also contributed to draw the interest from both policy practitioners and academics on the concept. In those studies, the idea of entrepreneurs interacting with various actors within the ecosystem that can support their development from different perspectives (e.g. through funding, experience and training programme or professional services) has been reinforced. This concept has since been regarded as a way of fostering economic growth, often with a focus on driving employment and high-growth firms (HGFs) (Mason and Brown 2014; Spigel and Harrison 2018). Much of the attention from practitioners and academics has focused on studying the characteristics and the ecosystem and how they could be effectively supported.

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In comparison, the emergence of the innovation ecosystem is thought to be closely related to two concepts: the innovation system and the business ecosystem. Lundvall (1985: 28) introduced a ‘system of innovation’ in his publication on user-producer relations and has since influenced the rise and development of the innovation system. Following which, Freeman (1987: 31) introduced the ‘national innovation system’ concept as a means to explain the economic booming and success of Japan. Facilitated by contributions from the OECD, the national innovation system concept has been accepted by policy makers and applied in policy-­ making practices (Sharif 2005). However, Japan suffered a dramatic economic downturn in 1990, drawing attention to constructively evaluate the country’s innovation system (Umemura 2013; Yoshino and Taghizadeh-Hesary 2015). In comparison, also with a national innovation system, America regained its competitive advantage in the world market with the rise of Silicon Valley (Atkinson 2014). The distinct contrasts had drawn attention from both scholars and policy makers to critically study and examine the differences between the two innovation systems (OECD 1997; Fukuda and Watanabe 2008, 2012; National Research Council 2009; Atkinson 2014). Following which, the ecosystem concept started to emerge as a response and was used by both scholars and policy makers to explain the success of Silicon Valley (Clinton and Gore 1994; Saxenian 1994; Lee 2000). Dedehayir et al. (2016) and Gomes et al. (2016) suggested that the ecosystem analogy on innovation should be traced back to the concept of business ecosystems, which was introduced by Moore in the 1990s. Moore’s (1993, 1996) work on business ecosystems has been seen as one of the first seminal contributions on ecosystem analogy in the field of business and management (Dedehayir et al. 2016). Moore (1996) discussed examples from firm level (e.g. Apple Computer) to industry level (American Airline) to country level (e.g. Costa Rica) and applied the business ecosystem concept into different contexts to explain their success. Moreover, Moore (1993) believed that a business ecosystem operates across diverse industries, where industries need to co-evolve and compete at the same time. It is apparent that innovation has been seen as the core of Moore’s definition on the business ecosystem. Dedehayir et al. (2016) had almost equalled the innovation ecosystem and the business ecosystem

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proposed by Moore (1996) in their publication and agree that innovation ecosystem is a collaborative effort towards innovation. Both entrepreneurial and innovation ecosystems emerged in hope of explaining successful socio-economic development in terms of a region or even a country. As the names suggest, the two ecosystems have different emphases: one is on entrepreneurs and the other is on innovation. Entrepreneurial ecosystem starts from entrepreneurs and their ventures, with emphasis on people, though it is worth noting that innovation is considered to be the core of the entrepreneurial process. In contrast, the innovation ecosystem is centred on the innovation and knowledge outputs and then assembling resources to enable it to happen. Although the two ecosystems are different concepts, many believe that they are closely associated and suggest they are interchangeable (Levie et al. 2013; Stern 2014). In order to build ecosystems that support transformational entrepreneurship, it is useful to understand the two concepts and draw lessons from them. Thus, the next section discusses and compares the two ecosystems from aspects of construct, evolutionary nature and measurement framework.

2.3 C  onstruct, Evolutionary Nature and Measurement 2.3.1 Entrepreneurial Ecosystem Academics have suggested a range of different models in studying entrepreneurial ecosystems (e.g. Isenberg 2011; Vogel 2013; Mason and Brown 2014; Stam 2015). Many of the models are similar in nature and can be broadly divided into two groups. Isenberg’s (2011) model represents the first type: a flat structure with various domains and actors. The six domains include finance, policy, market, human capital, supports and culture. Actors within the ecosystem are not isolated but integrated into a long sustainable development goal. In contrast, Stam (2015) ­emphasises the importance of reflecting on the casual relations within the ecosystem and includes entrepreneurial activities and value creation in the model. While the model recognises the importance of different actors and their

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interactions within the ecosystem, it also draws attention on how these conditions support the entrepreneurial activities and value creation, which can then be fed back to the system. Though the models draw a picture of how a successful entrepreneurial ecosystem should look, it is equally important to understand how those ecosystems evolved over time. A dynamic and self-sustainable ecosystem does not appear overnight. In fact, it often involves decades of continuous collected effort (Neck et al. 2004; Mason and Brown 2014; Mack and Mayer 2016). For example, Silicon Valley’s history can be traced back to as early as the 1970s. The development of Zhong Guan Cun (China’s Silicon Valley) started in the early 1980s. The early government’s effort in shifting Taiwan’s low-cost manufacturing driven industry in the 1980s led to today’s technology-inspired ecosystem. This does mean that every ecosystem needs to go through the same time duration, but it is essential that stakeholders should have a long-term view on developing ecosystems. Some scholars divide the evolution process into several stages (Mack and Mayer 2016), which broadly contains phases of birth, growth, sustainment and decline. Every stage has different characteristics and support requirements. For example, the emergence of an entrepreneurial ecosystem is often thought to be tightly linked to the location where talents are attracted to. During this stage, the region might expect to witness a rapidly growing number of start-ups over a relatively short space of time. Depending on the local condition, restraints that hinder businesses development may come from an unfavourable entrepreneurial culture, lack of start-up funding or talents, pressure from traditional policies that impedes entrepreneurship or market condition. As the ecosystem develops, spin-offs and entrepreneurial recycling activities become increasingly common (Mason and Brown 2014). Networks start to form, where people within can enjoy the benefits (Mack and Mayer 2016). Support required in this stage also evolves and often ranges from aspects such as network development and scale-up funding to specialised talents. Ineffective response to shocks from internal and external environments such as technology, industry or market change, cut-down of support from policy and finance may lead to a decline in entrepreneurial activities.

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It is worth noting that each ecosystem (or potential ecosystem) is different and has its own characteristics. The needs required vary, which calls for location-specific programmes and support being designed. Isenberg (2010) agrees with the contextualisation of policies and urged governments to create ecosystems fit for their own circumstances. Appropriate measurement frameworks can not only help determine the strengths and weakness of an existing ecosystem but also provide valuable information for practitioners in designing intervention strategies (Vogel 2013; Mason and Brown 2014). However, there are challenges of deriving such an appropriate framework, for example, the complexity of the concept and difficulty in obtaining accurate data. A proxy measurement method is commonly used to address the issue of information shortage. The measurement metrics tend to be complex and often involve dozens of specific indicators. Various frameworks have been proposed over time (Ebdrup 2013; Vogel 2013; Stern 2014; Stam 2015; Stangler and Bell-Masterson 2015) and normally address areas such as entrepreneurial performance, infrastructure, networks, market and demand, culture and community, talent, finance, knowledge and innovation. In particular, the number of start-ups and high-growth firms is regarded as a key indicator. Some researchers focus more narrowly on innovation and therefore include metrics such as patents and research investment in the framework.

2.3.2 Innovation Ecosystems Discussions on innovation ecosystems are mostly centred on innovation outputs. This approach is developed from answering questions such as: Who, how and why innovation is produced and sustained? How is the innovation being used? For example, Jackson (2011) defines the ecosystem as a unified range of actors to enable technological development and innovation. Oksanen and Hautamäki (2015) focus on the dynamic nature of an interactive network that breeds innovation. The contexts where the ­innovation ecosystem concept has been employed range from company level, regional level and national level to international level. From a broad perspective, enablers include funding, infrastructure, talents, which may

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come from participating in a range of organisations, and aspects such as culture and regulation. All these actors contribute to the innovation outputs. However, it should also be highlighted that the successful commercialisation of innovation outputs is vital to build a successful innovation ecosystem (Smith 2006; Oh et al. 2016). Similar to an entrepreneurial ecosystem, an innovation ecosystem also needs to go through its own stages of development (Moore 1993). The four stages of the business ecosystem evolution process proposed by Moore (1993) consist of birth, expansion, leadership and self-renewal (or death). This method has since then been discussed and used by various scholars such as Dedehayir et al. (2016), who had applied this framework into innovation ecosystems. More recently, Rabelo and Bernus (2015) have attempted to capture the innovation ecosystem life cycle by dividing it into six phases: analysis, project, deployment, execution, conclusion and sustenance. Strategic decisions are made in the analysis phase and often involve contributions from governments or universities and employ various analysis tools (e.g. Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis, business canvas) and project designs to prepare and build the innovation ecosystem (Rabelo and Bernus 2015). The deployment phase starts with the formal process of building the ecosystem (which includes actions such as attracting actors and marketing, recruiting actors, building constructions and ecosystem foundations) and is followed by the execution phase (which manages the ecosystem operations) (Rabelo and Bernus 2015). Finally, the, conclusion phase focuses on resolving issues that could hinder the ecosystem’s sustainability, whereas the sustenance phase looks at ‘future evolution and viability of the ecosystem’ (Rabelo and Bernus 2015: 2256). As Jackson (2011) argues, a successful innovation ecosystem needs to effectively balance out and communicate the requirements from two distinct economies: the research economy and the commercial economy. This leads to two important features of an innovation ecosystem. Firstly, the commercial success of the innovation outputs is vital and needs to outweigh the research expenses for the ecosystem to be self-sustainable in long term. Secondly, universities or other research institutions often play a key role in the ecosystem as the main source of research outputs. Similar to the entrepreneurship concept, innovation itself is also a complex concept and hard to measure (Traitler et al. 2011). The parameter of

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the conversation on innovation ecosystem measurement frameworks is still diversified. Doss (2013) identified seven fundamentals for consideration when developing measurement frameworks of an innovation ecosystem, namely, leadership diversity; effective lines of communication between stakeholders; diverse, broad range of skill sets in the workforce; high levels of engagement between diverse workforce groups; activities that encompass technical domains and foster collaboration; trust within the organisation; and supportive team members with no expectation of immediate return. It is worth noting that the conversation was focused on organisation, therefore the dominance of organisational factors. However, Wallner and Menrad (2011) point out that a rather linear approach is often adopted in discussing innovation ecosystem models, which may lead to ‘absurd results’ and inappropriate benchmarking. Indeed, Graham (2013: i) has also expressed concerns that ‘many experts regarded commonly used research commercialization metrics (number of spin-offs, licensing revenue) as unreliable indicators of a university’s long-term capability to support or develop a vibrant ecosystem’. This argument is supported by Oh et al. (2016) for three main reasons. Firstly, various groups of players within an innovation ecosystem hold different opinions on the value and importance of different system outputs such as employment, well-being and support. Secondly, the success of the performance of an innovation ecosystem depends largely on the ability of consistently recognising and breaking through bottlenecks, and less about how fast people can work or trade capital for labour. Lastly, the success of an ecosystem derives from the combined efforts of emerging leadership, the development of human resources, and authorities’ level of tolerance towards innovative strategies (Oh et al. 2016).

2.3.3 Commonalities and Differences Between Innovation and Entrepreneurial Ecosystems Although the entrepreneurial and innovation ecosystems are closely associated with each other, the two concepts are different in various aspects. According to Jackson (2011), the context of the innovation ecosystem ranges from a firm to a nation. By contrast, the entrepreneurial ecosystem

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is often situated at regional or national level. Moreover, proximity of all actors is essential in an entrepreneurial ecosystem. However, this becomes more flexible in an innovation ecosystem. This leads to the difference on the emergence of the two ecosystems. As Isenberg (2011) suggests, to nurture a successful entrepreneurial ecosystem, a region needs to show visible signs of potential first rather than government or other powerful players design it from scratch. By contrast, the innovation ecosystem often originates from universities’ or research institutes’ research outputs, which makes it theoretically possible to design the programme through investment in R&D. In addition, although both ecosystems have an evolutionary nature, they are classified very differently (Jackson 2011; Stangler and Bell-­ Masterson 2015). For an entrepreneurial ecosystem, classifications are based on the overall performance of the businesses in the region and the evolution of their requirements. However, research tends to structure the innovation ecosystem evolution process based on the needs, development and commercialisation of innovation and research outputs. This can be further distinguished through investigating the different success measurement frameworks employed. Although related, the focus of the two ecosystems is different, which can be reflected on the measurements chosen for evaluating the performances. For instance, both require commercial benefits, but such benefit is mainly measured in terms of financial return at innovation ecosystems, whereas indicators such as number of HGFs, spin-off rates and employment are also commonly used in entrepreneurship ecosystems (Jackson 2011; Stangler and Bell-Masterson 2015). For government leaders, these differences can result in variations in policy intervention strategies.

2.4 K  ey Principles for Building Sound Ecosystems As discussed in previous sections, though with many similarities, entrepreneurial and innovation ecosystems are different in many ways. In particular, entrepreneurs and the ventures are at the core of entrepreneurial ecosystems. Although successful commercialisation is key to an innovation

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ecosystem, it is normally built upon a particular technological or scientific output. In fostering a network-enabled second-order business model innovation and supporting transformational ventures, key lessons are drawn from both the innovation and the entrepreneurial ecosystem. Therefore, this section focuses on discussing important principles for building a sound ecosystem that nurtures transformational entrepreneurship.

2.4.1 Listen to the Local Needs Each context is unique and therefore every ecosystem should be different. To build an environment that supports transformational entrepreneurship, influential players such as the government need to carefully study the local condition and create a demand-driven ecosystem. Trying to imitate an existing successful ecosystem and impose assumed policy has little use in reality and sometimes may hinder the development of the local ecosystem (Isenberg 2010; Mason and Brown 2014). The differences in culture, political system, financing options, talent pool or even transportation means need to be taken into consideration when designing a local ecosystem. Merely copying best practices is likely to fail. For example, seeing the start-up co-working space work well in cities like London and San Francisco, the same concept was implemented in many Chinese cities, including many third-tier and fourth-tier cities. However, with not much more than merely a space to work, the majority of those co-­working spaces has a very low occupation rate (Kbgok 2018). The reasons are complex. However, in essence, often those co-working spaces were not developed in response to local needs but because of the mind-set of copying best practices and assuming they would work.

2.4.2 Long-Term Vision The development of an ecosystem takes time. As Feld (2012) argued, the time required to develop a successful ecosystem normally is a minimum of 20 years. In order to ensure the evolution occurs correctly and supports transformational entrepreneurship, the right culture needs to be nurtured, appropriate infrastructure needs to be build and effective networks and

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communities need to be formed, if not already in existence (Isenberg 2010; Vogel 2013; Mason and Brown 2014). For an ecosystem to be selfsustainable, the outputs need to outweigh the investments in the long term. For example, the number of start-ups created can be a temporary measure of success at an early stage of ecosystem development. However, over the long term, it is also important to measure how many of them have survived and grown or contributed to the ecosystem in other forms over the course of the decades of development (Isenberg 2010; Vogel 2013; Mason and Brown 2014).

2.4.3 Work Collectively A successful ecosystem is developed through collective efforts from a range of actors (Mason and Brown 2014; Erina et al. 2017; Roundy et al. 2018). Different groups within the ecosystem, including both private and public sectors, need to understand their roles within the ecosystem and work together towards a common goal that subsequently encourages transformational entrepreneurship endeavours. These have several implications. Firstly, it is important to build an environment with the right mix of people in it that generally involves entrepreneurs, investors, mentors, service providers and government. Universities and large companies can also become key players in some ecosystems (Mason and Brown 2014). In addition, in order for the ecosystem to function well, it is essential to gather talents with diverse backgrounds and skills rather than focusing only on one particular type (Roundy et al. 2017). Similar to an ecology ecosystem, limiting the options in the talent pool does not help with long-term stability. Last but not the least, the ecosystem does not belong to any one particular person, but grown and benefited by this ­collective group. Therefore, it’s important to be inclusive and have an open and collaborative culture.

2.4.4 Act Responsively An ecosystem evolves over time which requires actors within the ecosystem to act responsively to the changing needs and opportunities (Mack and Mayer 2016). For instance, emphasis may be put on encouraging and supporting

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start-ups when ecosystems first emerge through interventions such as start-up programmes and reduced administrative burdens. As the ecosystem evolves and more and more companies start to grow, increased demand may be on areas such as management, internationalisation or scale-up funding. Changes may also come from external environment such as shifts in the market trend. However, it is also important to not over-engineer the process but focus on fostering organic growth (Isenberg 2010). Government needs to be particularly careful and resist from enforcing new initiatives without engaging the entrepreneurs. Both private and public sectors need to be vigilant and respond appropriately to the changing needs so that transformational entrepreneurship can be supported in a sustainable way. Otherwise, the ecosystem may face the risk of declining.

2.4.5 Share Motivational Stories and Milestones While it is important to understand that building an ecosystem takes time, people require motivations and assurances along the way. The entrepreneur community can be surprisingly motivated by a breakthrough success that happens in the same community (Isenberg 2010; Cohen et  al. 2015). Uncovering and sharing such a story is important in building the ecosystem and maintaining a self-motivated community. Moreover, success stories can also play a key role in sustaining the ecosystem in the post-growth phase when firm death rates start rising (Mack and Mayer 2016). Setting milestones and having some kind of success at different stages give confidence to stakeholders such as government and investors. Those milestones and metrics need to be regularly revisited and assessed to be best tailored to the local conditions and needs of the ecosystem so that transformational entrepreneurial activities can be continuously supported.

2.5 Conclusion Second-order innovation leads to high-impact, disruptive outcomes, which can potentially contribute to transformational entrepreneurship and bring about social-economic development. Both entrepreneurial and

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innovation ecosystems have the potential to act as an effective way to nurture such innovation activities. While successful commercialisation is key to innovation ecosystems, it also emphasises on technological and scientific outputs. This emphasis implies a lesser degree of inclusiveness compared with an entrepreneurial ecosystem, which is entrepreneur driven and more inclusive and open to various types of innovation. In order to build an environment that supports transformational entrepreneurship, lessons are drawn from both innovation and entrepreneurial ecosystems. However, to build a successful ecosystem that supports transformational entrepreneurship takes time and effort. In order to do so, several principles need to be considered, particularly for powerful stakeholders such as government. It needs to be understood that each ecosystem is different and that it takes time to build a successful and self-sustainable ecosystem. This implies that stakeholders need to have a long-term vision and listen to the local needs. In this long development journey, it is essential for all participants to work collectively and act responsively. As a good practice, it is very helpful for an ecosystem to share motivational stories originated from the place and milestones achieved to maintain or increase stakeholders’, especially investors’, confidence level.

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3 Case Study: Transformational Entrepreneurship in the UK—“From UK Bread Waste to Global Beer Brand” Rebecca Connolly

Abstract  Society is suffering from inequality, division and a rapidly changing environment. Though seemingly positive, economic growth and adopting an “onwards and upwards” mind-set have not resulted in the amelioration of such socio-economic challenges. Social entrepreneurship combines both economic and social goals, thus offering a sustainable approach to creating transformation. However, it is argued that social entrepreneurship has not fulfilled expectations that it will solve significant social problems. Nonetheless, there are still cases of social enterprises that have managed to address a societal problem and ethically expand their operations. This chapter will present a case of a social enterprise which is working towards solving the problem of food waste in the United Kingdom. The purpose of this chapter is to evaluate the socially transformative strategies and outcomes of a social enterprise, and consider the potential and future of the sector.

R. Connolly (*) Coventry University, Coventry, UK e-mail: [email protected] © The Author(s) 2019 G. Maas, P. Jones (eds.), Transformational Entrepreneurship Practices, https://doi.org/10.1007/978-3-030-11524-1_3

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Keywords  Social entrepreneurship • Social enterprise • Transformation • Sustainability • Environment • Food waste

3.1 Introduction Society is currently facing unprecedented urgent challenges. The global financial crisis of 2007–2008 resulted in austerity measures and public spending cuts in many economies (Krugman 2015) and created widespread distrust in corporations which were seen to prioritise profit over public spending (Stankorb 2012). Moreover, global inequality continues to grow: the development charity Oxfam reports that 82 per cent of the global income produced in 2017 went to the wealthiest 1 per cent (Elliott 2018). In addition to economic instability, humanity’s environment is under threat, as continually rising temperatures are set to result in unparalleled rises in sea levels, floods, droughts and turbulent weather (Climate Action Tracker 2018). Furthermore, such global issues are exacerbated by high levels of unemployment, disease, poverty and conflict in many societies (Rwigema and Venter 2004). As a result of such threats to humanity and the planet, there have been calls for new approaches to create widespread change (Caulkin 2017; Raworth 2017), though governments and non-governmental organisations have not yet succeeded in their attempts to ameliorate such escalating socio-economic crises (Arogyaswamy 2017). Entrepreneurship is recognised as a crucial component of many nations’ development strategies (Bosma et al. 2007; Gibb and Hannon 2006; Pretorius et al. 2005). Nonetheless, despite the plenitude of such strategies and support for entrepreneurship, the global economy continues to struggle to recover from the 2009 recession, whilst inequality and exclusion deepen (Caulkin 2017). For Maas et al. (2016) a transformational approach is essential for the evolution of sustainable entrepreneurship. Though progress is required to address existing failures and injustice within society, the meaning and approaches taken to achieve this have come under scrutiny (Raworth 2017). Raworth argues that the notion of “onwards and upwards” is deeply rooted within common discourse and viewed as the key to progress, whereas “slowing down” or “being low” are

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considered states that should be avoided. Furthermore, Raworth (2017: 39) surmises that if economic success were to be drawn, it would be an “ever-rising line of GDP,” though this unquestioned path has not resulted in society thriving. Nevertheless, Martin and Osberg (2015) assert that on occasion a society takes a revolutionary leap towards a different equilibrium. Social change is viewed as a process of gradual incremental developments over time, much like the growth curve typically advocated in economics. Conversely, social transformation entails an integral shift in society (Khondker and Schuerkens 2014); this shift has been described as a “step change” (Martin and Osberg 2015: 37–38). Thus, it is argued that societies need to venture beyond typical progress, and instead aim for socially transformative solutions (Martin and Osberg 2015). As social entrepreneurship occupies both the economic and social sectors (Hockerts 2006), it holds the potential to create ethical and balanced transformation. Innovation is one of the key components of social entrepreneurship, and it is argued that what sets social enterprises apart from other businesses and traditional social service providers is the unconventional, disruptive path it adopts towards progress (Nicholls and Cho 2006). Nonetheless, setting up financially sustainable businesses, in addition to contending with often-challenging social and environmental problems, can lead to many social entrepreneurs failing to scale impact, create transformation or indeed continue operations (Alvord et al. 2004; Austin et al. 2006; Weerawardena and Mort 2006). It is argued that with few exceptions, social entrepreneurship has not fulfilled expectations that it will fundamentally, and on a great scale, solve significant social problems in order for a substantial number of people to benefit (World Economic Forum 2015). Nonetheless, there is still evidence of cases of social enterprises that have actively addressed a problem, created beneficial outcomes and effectively scaled operations. This chapter will present such a case. Through analysis of a social enterprise which is working towards solving the problem of food waste in the United Kingdom (UK), this chapter will evaluate its socially transformative strategies and outcomes, consider how such an example could influence other social enterprises, and contemplate the future of the sector.

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3.2 Background Information on Case Approximately one-third of the food produced for human consumption globally is lost or wasted each year (Kirk and Scott 2018). Food waste charity, WRAP, estimates that in the UK alone 1.9 million tonnes of food is wasted by the food industry each year. In addition, 44 per cent of the bread produced in the UK is never consumed (Toast Ale 2018). This chapter will explore the case of Toast Ale, a craft beer which is brewed using fresh surplus bread. Toast Ale was established in the UK in January 2016 and launched in the United States (US), South Africa, Brazil and Iceland in 2017. As of March 2018, Toast Ale has upcycled 15 tonnes of surplus bread, brewing 178,000 litres of beer, which is sold in varying contexts globally. For this case study, interviews were conducted with two of the social enterprise’s key team members in the UK and South Africa. This chapter will assess information gathered from these interviews as well as analyse Toast Ale’s business model to draw conclusions on how an environmental mission in the UK expanded to reduce bread waste on a global scale.

3.3 Background on Company Toast Ale was founded in January 2016 by Tristram Stuart, an author and campaigner on the environmental and social impacts of food production. His book, Waste: Uncovering the Global Food Scandal (2009), revealed that Western countries waste up to half of their food, and that tackling this problem is one of the simplest ways of reducing pressure on the environment and on global food supplies. Stuart founded the environmental charity Feedback and set up Feeding the 5000 (www.feeding5k.org), the flagship event of a global food waste campaign, whereby 5000 members of the public are given a free lunch using only ingredients that otherwise would have been wasted. Almost half of the bread produced in the UK is wasted, though this overproduction is built into the business model of most bakeries and supermarkets (Zimberoff 2017), as consumers expect to be able to purchase fresh bread at any time of the day. However, Stuart

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uncovered a way to turn this unused commodity into a lucrative product with a longer shelf life: through the production of craft ale (Zimberoff 2017). Toast Ale was launched with endorsement from British chef and restauranteur Jamie Oliver and has been championed by author and campaigner Hugh Fearnley-Whittingstall. Toast Ale sources surplus bread from bakeries and sandwich makers, using it to replace one-third of the virgin grain, adding only malted barley, hops, yeast and water. Toast Ale has contracts with established brewers, leveraging their expertise to create unique beers. Its core range of beers is brewed by Wold Top Brewery in Yorkshire, one of the UK’s most environmentally friendly breweries, with surplus bread from Adelie Foods (Beeler 2018). Toast Ale’s mission is to end food waste through their four founding principles: to produce great craft beer that consumers love; to eliminate bread waste directly through brewing; to raise awareness of the problems of, and solutions to, food waste; to maximise profits to donate to the charity Feedback and other international food waste organisations. (Toast Ale 2018)

In 2017, Toast Ale launched with brewing partners in the US (New York), South Africa (Cape Town), Brazil (Rio de Janeiro) and Iceland (Reykjavik). It has also published a homebrew recipe to encourage people not to waste purchased bread in their homes. All profits generated by Toast Ale in the UK and the US go to Tristram Stuart’s environmental charity, Feedback. Profits produced by international partners support local charities.

3.4 UK Context and Social Entrepreneurship The UK, an innovation-driven economy (Schwab and Porter  2008), comprises England, Scotland, Wales and Northern Ireland. It has a population of 62.8  million, with a gross domestic product (GDP) of $2.861  trillion (World Bank 2015). The state is characterised as the birthplace of contemporary parliamentary democracy and the Industrial Revolution (BBC News 2017). However, the UK’s position in the world

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weakened in the twentieth century, following two world wars and the end of the empire (BBC News 2017). Though the state still remains an influential economic and military power, the 2016 vote to leave the European Union (EU) has raised further concerns over the UK’s role internationally. The standard measure of income inequality, the Gini coefficient, presents Britain’s post-tax inequality greatly increasing in the 1980s, from 28 per cent in 1978 to 41 per cent in 1990 (Cable 2017). Following the financial crisis of 2007–2008, the UK experienced its first recession in almost 30 years and public spending cuts were inevitable (Ridley-Duff and Bull 2016). Furthermore, it has been argued that Britain’s vote to leave the EU in 2016 highlighted a divided nation: it is believed that the vote for Brexit represents the discontent of many people in the UK, who feel excluded and want change (Mckenzie 2016). A key argument in support of inequality is that it acts as an incentive to work, save, invest and innovate (Cable 2017). However, in 2016, the UK’s productivity was rated significantly below the other major economies in Europe, measured as GDP per hour worked (Sherry 2017). Furthermore, counter to the argument that inequality drives innovation, high-profile business figures, such as Bill Gates, argue for bold taxation of inheritance and entrepreneur Luke Johnson argues for taxing property more and income less (Cable 2017). Social entrepreneurship as a field is attracting increased consideration from academics, practitioners and the business world (Mueller et  al. 2015), as it offers the hope that individuals will employ their localised knowledge to identify new innovations to fill the gaps in social delivery left by governmental and institutional failures (Dees 1998; Barendsen and Gardner 2004; Harding 2004; Doane 2014). Though social entrepreneurship began to gain recognition in the 1990s (Hinchion 2017), entrepreneurs with a social purpose have always existed (Dees 1998; Barendsen and Gardner 2004; Boddice 2009; Bornstein and Davis 2010) in the UK, for example, Robert Owen, Joseph Rowntree, William Cadbury and Michael Young. Following a history of social innovators, social entrepreneurship experienced a revival in the UK in the 1990s; this was due to the fusion of various organisations, including co-operatives, charities, not-for-profits and social businesses, with a shared goal of

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creating social change: this union led to the formation of the term the Third Sector (Ridley-Duff and Bull 2016). With the promise of solving large-­scale social problems for many whilst simultaneously stimulating the economy, attention has turned to social enterprises among governments, policy makers and sector leaders as a potential fourth way (Burrows 2003; Stankorb 2012). Social Enterprise UK (SEUK) (2017) reports that 28 per cent of social enterprises are based in the most deprived communities in the UK.  Furthermore, the number of social enterprises introducing a new product or service in the previous year was said to be 50 per cent, whereas among small- and medium-sized enterprises (SMEs), the number has fallen to 33 per cent. In addition, the report details how the leadership teams of social enterprises reflect the communities where they are based and operate. With austerity, persistent inequalities and the uncertainty that accompanies leaving the EU, it could be argued that all businesses in the UK will need to employ the skills associated with social enterprises: “making the most of the resources we have, creating opportunities for all, and demonstrating how we can all do business more equitably” (SEUK 2017: 6). However, the public sector remains a key source of income for social enterprises, particularly the largest: it is the main source of income for 59 per cent of those turning over more than £5 million (SEUK 2017). Furthermore, one in eight of those with public sector income is receiving it via European programmes (SEUK 2017); thus the fate of such enterprises is unknown as we approach Brexit in 2019. Hence, in this context, it is imperative that businesses solidify strategies not only for creating social transformation but also for the development of sustainable entrepreneurship (Maas et al. 2016).

3.5 Case Study 3.5.1 Networks to Scale In an attempt to create greater change and impact globally, social enterprises are encouraged to build sustainable scalable ventures (Dees and

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Battle Anderson 2004; Howard 2014). However, balancing a social goal with economic scalability can be arduous, especially when attempting to compete with conventional for-profit businesses (Vickers 2010). When it comes to production, Toast Ale rely on partners and contracts to turn surplus bread into beer. Toast Ale in the UK currently works predominantly with a brewer called Wold Top Brewery in Yorkshire. One of Toast Ale’s key team members in the UK (Participant 1) explains how contracting was crucial to the establishment of the business: We didn’t need to invest upfront in a brewery … which means we can be quite flexible so we can scale up pretty easily and we have done hence moving the brewery twice as we’ve taken on bigger clients. … Also not having that capital cost means that we can get profit quicker.

Nonetheless, scaling is not the only objective when selecting partners for Toast Ale, they must also be creating impact which compliments the company’s mission. In this case, sustainability and waste reduction are key to Toast Ale’s aims. When describing Wold Top Brewery, Participant 1 asserts that they’re one of the most sustainable breweries in the UK … they have two wind turbines on site that power the brewery, they use water from a borehole on site, all of their ingredients are locally sourced. … And then all of the surplus is sent for animal feed. So they’re a really perfect partner for us.

As well as scale its production across the UK, Toast Ale also has two franchises, based in South Africa and Iceland. It has also launched a subsidiary company in New York from which it will expand across the US. However, Toast Ale’s most recent and preferred way of growing internationally is through licensing, due to the ease of starting up when production and distribution are already established. The business has partnered with a licensed brewer in Rio de Janeiro in Brazil and is having conversations with a number of different breweries to license in further  contexts. Participant 1 describes how setting up Toast Ale in the US as a subsidiary was important because it is a key market for the business and they  “wanted to be involved in that as

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Toast Ale.” However, participant 1  explains how this was a lengthy and costly process. In the case of South Africa and Iceland, franchising was a way to set up “Toast businesses in different regions.” Though, this is also described as a complex process: It takes time to find all the partners to be involved … there’s usually somebody that’s running it, an entrepreneur or some social enterprise. And then they need to find the brewer, the bread supplier. Also on a global basis we work with local charities. So in the UK all of our profits go to Feedback and in the US. But at the global level we want the local charities to benefit. In Iceland and South Africa they then partner with a charity and everything takes quite a long time.

Hayek (1945) presents the importance of local contextual knowledge in the entrepreneurial process, surmising that identifying far-reaching opportunities is futile, as the knowledge which an entrepreneur possesses is not relevant outside of their context. Pless (2012) posits that social projects established within an environment of poverty often involve marginalised members of the community more inclusively as a way to more fully understand their needs. Profits generated by Toast Ale’s franchise in South Africa are donated to Soil for Life, a non-profit organisation that trains local unemployed people to grow their own food for their families and communities. Toast Ale’s franchise in South Africa is being driven by two individuals. In an interview, one of these individuals (Participant 2) in Cape Town in November 2017 discusses the meaning of social enterprise in the context of their home country of South Africa: I do think well actually there’s so many social enterprises in South Africa that nobody’s heard of and I think that’s generally for all small businesses because there’s so many problems in South Africa I think the majority of businesses that start up now it’s because they want to solve something some form of not only financial problem but a social problem. … So your agricultural sector it’s not a social enterprise it’s literally survival so you have to do something innovative to be able to survive the drought or something like that.

Though Toast Ale acknowledges the importance of generating a profit, as any money it raises is then donated to its global charities, the business

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also realises the importance of having both direct and indirect social impact, particularly in contexts where poverty is commonplace. In ­considering the philosophy of impact, Participant 2 recalls an account from a farmer supported by Soil for Life: [O]ne home gardener spoke at our launch event. So he lives in a shack … some of his produce just gets stolen because it’s in front of his shack, not that there is really a front but on the roadside so some of his produce does get stolen so in effect that still makes a social impact then at this stage … definitely makes an impact and the nice thing about food sustainability or by training people to grow food, food becomes a major multiplier for indirect beneficiaries.

Embeddedness in one’s culture is also said to be important in the formation of an enterprise, as it enables the entrepreneur to identify and gain the resources required for the establishment of their venture (Hansen 1995) and identify and operate the mechanisms for change (Martin and Osberg 2015). Thus, franchising seems an ideal approach to adopt in an attempt to scale, as it simultaneously upholds the mission and brand whilst leveraging local expertise. However, the relationship between franchisor and franchisee has often been described as being potentially conflicted, as the franchisor strives for standardisation to ensure brand consistency, whilst franchisees can seek autonomy to drive their enterprise (Kidwell et al. 2007). Participant 2 (2017) comments on Toast Ale’s franchise relationship: [S]o technically we’re very kind of independent, certain contractual agreements are in place. … normal franchise model but we can do, we don’t have to produce a beer exactly the same as in the UK … we can amend the labelling but we can generally piggy back on their marketing as well but yes its very independent.

Participant 2 goes on to explain how they have experienced swift success since their establishment in November 2017: South Africa’s first brew is bigger than Toast Ale UK’s last brew over two years… we’re very commercial very quickly.

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It has been suggested that in a franchise relationship, there is a danger that franchises can behave in ways that have the potential to deteriorate brand image (Kidwell et al. 2007). In the case of a social business, where the social mission and values are central to operations, then such an outcome is not only an inconvenience but has the potential to erode consumer and shareholder trust. Furthermore, it has been argued that embeddedness can work as both a catalyst and an inhibitor for social entrepreneurial activities within communities. The concept of embeddedness implies that it is insurmountable to disconnect agent (the entrepreneur) and structure (the context) (Mair and Marti 2006). High levels of embeddedness within a context may hinder the development of projects focused at creating social change, specifically when such interventions involve “changing the rules of the game” (Mair and Marti 2006: 42). Similarly, when analysing entrepreneurs embedded in their local context, Jack and Anderson (2002) surmise that neglecting to abide by rules and conform to expectation could result in the disintegration of relationships, which could impede business activities. Thus, a systemic approach has been described as essential in the creation of transformation, which would result in moving the responsibility to create change away from the individual leading the enterprise and towards the context (Maas et al. 2016). An example of influencing many actors within a system is crowdfunding (Josefy et  al. 2016). In 2017, Toast Ale launched a crowdfunding campaign in order to brew two new beer styles and it “hit 140 per cent of (its) target” (Participant 1 2017). Harms (2007), Stiver et al. (2015) and Josefy et al. (2016) discuss the unique role the community plays in the success of a crowdfunding venture. The community, which provides the funding for an enterprise through a crowdfunding campaign, has a vested interest in the venture, as its members subsequently play a fundamental role in its success, as beneficiaries (Harms 2007; Josefy et  al. 2016). Consequently, crowdfunding has the potential to be transformational, as it provides entrepreneurs with the chance to gain funding from a sphere of anticipated advocates (Maas and Jones 2015; Josefy et al. 2016). Thus, an approach

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to systemic change like crowdfunding not only achieves its economic goals but also engages those within the system in its new innovation.

3.5.2 Commercial and Social Worlds Setting up financially sustainable businesses in addition to contending with often-challenging objectives can lead to many social entrepreneurs failing to continue operations, scale impact and create transformation (Alvord et al. 2004; Austin et al. 2006; Weerawardena and Mort 2006). To achieve scalability, social entrepreneurs can adopt a commercial approach, seeking corporate consultation or mentorship, as well as pursuing social investment opportunities. In an attempt to establish themselves as legitimate entrepreneurs, social entrepreneurs can also angle towards conformance, which may result in institutional isomorphism (Nicholls and Cho 2006): the homogenisation of organisations within a field (DiMaggio and Powell 1991). As Nega and Schneider (2014) posit: To scale up, a social entrepreneur must invariably secure the support of the very institutions—NGOs, the private sector, and the state—that have failed to solve the problems he/she is trying to address.

When discussing Toast Ale’s preferred model for scaling internationally, Participant 1 (2017) explains: With licensing we are licensing to a brewery. Obviously it already exists. It has production already set up. It has distribution already set up because they’ve been brewing over the years and then Toast becomes one beer in their range … Quite often we do that by either licensing directly to the brewery, but quite often it comes about through having a relationship with a social enterprise or a non-­ profit that’s working on food issues in that country. And the only other thing is to find the bread source, but that then is the responsibility of the brewer. It just is a much simpler way of growing quickly.

Not only is Toast Ale a business with a social mission, it is also a craft ale company. Participant 1 (2017) explains how

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craft beer is quite a crowded market, and lots of companies and people that really like craft beer also tend to try lots of different beers so a little bit less loyal.

Similarly, Participant 2 (2017) explains how in the States craft beer companies make a new beer each week because people who drink artisanal beer want to taste something different every time, they’re not as brand loyal…

Therefore, how does Toast Ale manage to compete within this highly competitive market whilst maintaining its core values and objectives that set it apart from regular beer businesses? Participant 1 (2017) explains how in the early days there were challenges around people’s misconceptions of the beer: Some people thought it was kind of a novelty value because it was a charity beer, and a few people, we also had to be very clear about the bread source, it’s not stale bread. It’s definitely not moldy bread.

However, Toast Ale has now won awards for its taste and people try it and they say okay wow it is actually really good beer and we’ve been quite quickly able to get past that idea that it’s a novelty product. (Participant 1, 2017)

Participant 1 also credits Toast Ale’s story for giving them an advantage in the market, “it’s an amazing story and you can really want to be part of it.” Similarly, Participant 2 reiterates the importance of the story as Toast Ale expands to new contexts. He explains that where Toast Ale is sold in restaurants, the story can be told with your table talkers … instead of just putting it on a shelf next to other craft beer where the story is not going to get told because if we’re just simply going to have to compete with other craft breweries it’s pointless, we wouldn’t have entered into this business at all.

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Furthermore, not only is Toast Ale occupying both the social enterprise and craft ale markets, but there is now a growing market of businesses also making beer out of bread. Nonetheless, Toast Ale showcases these competing brands on its website, on a page entitled “Rev-ale-ution.” It has been argued that what sets social entrepreneurs apart from traditional business owners is that they welcome competition (Santos 2012), for if more businesses work on a particular problem, then the problem is resolved sooner, generating greater social impact. Toast Ale’s innovative story also gained prime time exposure on UK television programmes like Jamie & Jimmy’s Friday Night Feast and Food Unwrapped. Venturing into more contexts globally means that this story will continue to lengthen, though will it be a tale of significant social transformation or that of a successful product?

3.6 Transformational Entrepreneurship For Maas et al. (2016) a transformational approach to entrepreneurship involves a systemic process that is increasingly heuristic and holistic in character. Systemic entrepreneurship emphasises the need for a consideration of the whole of society, shifting the concept of the entrepreneur from the individual to the context (Maas et al. 2016). Through its franchise and licence models, Toast Ale is expanding its operations to new contexts whilst involving the actors within those contexts. The idea of using surplus bread to make beer that was born in the UK is applicable in any context where bread is sold commercially. Through a franchising and licensing approach Toast Ale UK is essentially selling its idea and allowing it to be executed in a contextually appropriate manner, by those who understand the environment, and to benefit local causes. Thus, Toast Ale’s impact is two-fold: it makes use of a resource that would otherwise be wasted and adds value to economies. Furthermore, Toast Ale considers the whole system in terms of not only its own expansion but also the network of food waste champions. Unlike traditional businesses, Toast Ale adopts a holistic standpoint and celebrates its competitors by advertising their businesses through its website. In addition, Toast Ale heuristically encourages people to brew with

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surplus bread at home with its homebrew recipe, which can also be found on its website. Such actions of course could result in the need for a business like Toast Ale to descend, thus implying a temporary nature of social entrepreneurship (McMullen and Bergman McMullen and Bergman 2017). Furthermore, as supermarkets and bakeries start to increasingly pay attention to their own overproduction and waste as a result of the awareness raised by such organisations, there may no longer be surplus bread to utilise. This would indeed prove that enterprises such as Toast Ale are capable of creating large-scale transformation, though this (transformation) eradicates the need for sustainable entrepreneurship in this sector.

3.7 Conclusion In just over two years, Toast Ale UK has upcycled 15 tonnes of surplus bread, brewing 178,000 litres of beer; it is stocked nationwide in mainstream stores such as Tesco and Waitrose as well as independent shops, restaurants and bars, and is brewing its beer across three continents. Toast Ale is transforming not only what happens to leftover bread, but also the purchasing choices made by consumers: instead of merely selecting a beer because of its taste or image, individuals are empowered to make a difference through their buying selections. From brewing at home to raising funds for the production of Toast Ale’s next beer, actors within the system are involved throughout the journey towards reducing food waste. This systemic approach has been said to be necessary for sustainable transformation (Maas et al. 2016). Nonetheless, the brand is expanding into new economies at pace, adopting a fast implementation strategy through licensing, though, as has been evidenced through analysis of this case, a key component to its success is its story and values. As is the case in certain franchise relationships, the need for independence and the actions of the franchisee can have a detrimental effect on brand image (Kidwell et al. 2007). Therefore, Toast Ale will need to ensure that the relationships built with brewers and distributors globally are based on more than business: encompassing mission and values. Participant 1 (2017) explains that

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part of our mission is about raising awareness of food waste, and the simplicity of solving that problem by enjoying a product and we think that taste is really the perfect way to do that.

Thus, it seems that people are paying attention, with 12 other businesses turning bread into beer and supermarkets like Tesco implementing rigorous strategies to tackle food waste (https://www.tescoplc.com/littlehelps-plan/products-food-waste/). Though the scale of food waste globally is colossal (Kirk and Scott 2018), the ultimate aim of Toast Ale is to eradicate it completely. Yet what implications does this have for the sustainability element of transformational social enterprises? Santos (2012: 345) asserts that social entrepreneurs are concerned with attaining “sustainable solutions” rather than “sustainable advantage.” If this notion of social entrepreneurship is accurate, then success for social enterprises is achieved when the social enterprise is no longer needed. McMullen and Bergman Jr (McMullen and Bergman 2017) analyse this point further when they consider that it is possible to create transformation even if an organisation has operationally failed, if an element of society has been transformed. Nevertheless, accepting that a mission has been accomplished and moving on from their organisation is not easy for all social entrepreneurs, who can become emotionally attached to the social enterprise they have built (Santos 2012). This attachment can lead to social entrepreneurs safeguarding against competitors, thus adopting similar operational approaches as conventional organisations (McMullen and Bergman McMullen and Bergman 2017) and, therefore, inhibiting innovative forms of action and transformation. It seems that Toast Ale has not fallen victim to such fears and champions all actors within society, driving change when it comes to food waste, and it will indeed be interesting to watch this business as it expands into diverse contexts. Though setting out to transform the plight of economies and communities globally can be a serious undertaking, Toast Ale is showcasing how “Actually, we can correct this problem by having a massive celebration” (Kronsberg 2017).

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3.8 Conclusion Disembedding the economy from society as a whole has not resulted in humanity thriving (Castles 2010; Raworth 2017); the world is thus searching for a new model for economic growth (Marmer 2012). With the social mission at the heart of its business operations (Dees 1998), social entrepreneurship provides a promising model for socio-economic growth. Nonetheless, as evidenced in this chapter, there are issues to consider when balancing both economic and social goals. One challenge social enterprises can face lies in maintaining their dynamic nature whilst competing in the marketplace with commercial businesses. Ensuring that the mission remains at the forefront and avoiding conformance, whilst generating profits, is what allows social enterprises to achieve transformational status. Furthermore, in order to accomplish transformation on a large scale, it is key that expansion is coupled with contextual knowledge, though, as this chapter considers, contextual embeddedness can also act as an inhibitor to transformation. In addition, a key differentiator of transformational social enterprises is that if they are to succeed in eradicating the problem they set out to tackle, the enterprise could cease to exist. Thus, transformational social entrepreneurs must not only accept but advocate the diminishing need for their business. In achieving transformational status, it seems that social enterprises must compete within a commercial market whilst retaining their unique characteristics and modes of delivery. This chapter has revealed that an effective way of achieving this is through a systemic approach: moving away from the individual or the business and towards the involvement of the entire system. Toast Ale involves individuals in its work through its inspirational story, its ethically and contextually considered partnerships, its crowdfunding campaigns, and through welcoming competition. Social entrepreneurship will succeed in achieving true transformation when it not only avoids “business as usual” strategies but also manages to convert the way business is done in all sectors.

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4 Case Study: Gender and Enterprise Development in Africa Keren Naa Abeka Arthur

Abstract  This chapter explores the question of how female micro entrepreneurs can transition into transformational entrepreneurs. Using case studies, the chapter draws on the experiences of successful women entrepreneurs who have succeeded in growing their businesses from micro enterprises into impactful ones. In addition, the chapter conducts a cross-­ case analysis and highlights lessons learnt for policy making. Keywords  Female entrepreneurs • Micro entrepreneurs • Gender

4.1 Introduction Gender and enterprise development is a growing field of study among practitioners and academics globally. In academia, researchers continue to investigate the topic, with major journals introducing special issues on the topic. Actors interested in gender and enterprise development studies K. N. A. Arthur (*) University of Cape Coast, Cape Coast, Ghana e-mail: [email protected] © The Author(s) 2019 G. Maas, P. Jones (eds.), Transformational Entrepreneurship Practices, https://doi.org/10.1007/978-3-030-11524-1_4

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have questioned whether significant differences exist in the characteristics of male and female entrepreneurs, their organizations and the challenges they face, among others. To this end, findings show that differences exist in women and men entrepreneurship, female and male entrepreneurs vary in characteristics and some challenges in enterprise development are unique to women entrepreneurs when compared with their male counterparts (Minniti 2009). While studies on gender and entrepreneurship abound globally, there are still lapses in the understanding of the interrelationship between gender and enterprise development in Africa. Henry et al. (2015), after reviewing the literature, suggest that current studies for the past 30 years have focused only on specific topics such as male/ female comparisons, are quantitative in nature and center on practices in the west (e.g. North America, United Kingdom and Australia); hence the need to explore new areas of interest and provide more depth to issues identified using qualitative approaches. In Africa, an understanding of the dynamics between gender and enterprise development is important considering the role of women in society. Women play a significant role in the nurturing of children, and their ability to gain independence through meaningful jobs would go a long way in benefiting their families and the economy as a whole. Research shows that in Africa, a large portion of entrepreneurs fall within the micro and small enterprise (MSE) category, which is dominated by women. MSEs constitute one of the types of entrepreneurial businesses that exist which contributes the least to economic impact and long-term societal impact (Marmer 2012). Therefore, though high in number, women entrepreneurs collectively may not be making much of an impact to socio-economic development. To this end scholars (Schoar 2010; Maas et al. 2016) argue in favor of encouraging another type of entrepreneurial business referred to as transformational enterprises (TEs), found to contribute mostly to both economic and long-term societal impact. What can be done with the large numbers of women MSEs that exist in African societies? They may not contribute much collectively to the overall development of the economy at a fast pace, but they provide subsistence for many individuals and families in our communities. Should policy makers ignore them and invest in new start-ups that focus on establishing themselves as TEs right from the start? Or can they be helped to transition into

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TEs? (Schoar 2010) argues that the move from MSE to TE is difficult, as entrepreneurs within these institutions vary in personal characteristics such as objectives, skills and roles in economic development; in developing economies this is even more difficult due to regulatory and capital constraints. Therefore, the notion that MSEs evolve into TEs or that MSEs are a first step to building TEs could be flawed; despite this, there are a very small number of subsistence entrepreneurs who manage to transition to transformational entrepreneurs (Schoar  2010). For Africa to reap the benefits of entrepreneurship in the next decade, there is a need not only to create new enterprises but also to develop existing ones and help them have the right outlook for growth. Using the case study approach and data from primary and secondary sources, this chapter explores the stories of women entrepreneurs who have managed to grow their organizations from MSEs. The chapter seeks to bring to the fore factors that have catalyzed the growth of these entrepreneurs and the strategies they have used to overcome the unique challenges that characterize women transformational entrepreneurs.

4.2 Case Studies 4.2.1 Amalena Children’s Haven1 Located in the middle of the famous Makola Market in Accra Central, Ghana, Amalena Children’s Haven prides itself with a 40-year history in the baby and children clothes and accessories business. The organization is a family business owned and managed by a mother and her children, two of which are women. As far back as 1978, the young mother started the journey to what now stands for the business when she decided to start a small table-top shop selling baby clothes in Kumasi, as a way of making ends meet. In those days, she usually traveled to Accra to buy items to stock her shop in Kumasi, but noticed that by the time she moved from her point of purchase to the transport yard to board a vehicle to Kumasi, all the items she had in her shopping basket had been bought by onlookers within the Central locality. This led to an awakening on the opportunities  This case was written using primary data collected through an interview with Anita Osei-Assibey.

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available in Accra and her subsequent decision to do business there. Today, Amalena Children’s Haven has grown from a table-top shop to a multimillion cedi business comprising 14 outlets (11 in Accra and 3 in Kumasi), 100-plus employees and a recently launched online platform to enable customers to shop for quality products remotely. In addition, the portfolio of businesses for the owners of this organization has been diversified for the past four years to include a pre-school with 21 employees. To some extent, the progress chalked so far has become possible not only through hard work and sacrifice by all involved, but also through some brilliant decisions made by Anita Osei-Assibey, youngest daughter of the original owner of this organization. On graduating from the university with a degree in Business Administration, Anita joined the organization full-time 12 years ago. Prior to this, she had been helping on weekends and during school breaks. Anita constantly makes reference to the term “Makola business” to suggest some preconceived notion of a level of informality with the kind of business environment in which she finds herself. Nevertheless, she has been instrumental in making their organization standout by introducing formal mechanisms and controls. She says, “mum thinks the whole business revolves around Sylvia and I”, but now she is beginning to see that with the formalized systems I have put in place, things can go on in our absence. These mechanisms include proper financial-record-keeping systems, inventory labeling and management databases, automated business processes, efficient shop setup designs, new product development and employee monitoring systems, among others. When asked about the challenges faced as an entrepreneur, Anita reports not having an issue with access to finance. She argues that the organization has no history of borrowing from banks but believes in reinvesting profits for success. What frustrates her most is resistance from co-owners and the industry to innovation. She is faced with the challenge of convincing her mum to change the status quo and some ideas have not been pursued as a result. In her opinion, the key factor that has enabled her to transform her mum’s business over the past years is education. With this education, she believes she is well informed and able to take risks. This is her motivation for currently pursuing an early childhood

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development education to help her manage and grow the school business too. Anita’s plans are to innovate vertically and add on supply-side ­activities such as a production unit moving forward. She believes this would not be easy and is bracing herself to deal with the negative customer reactions, to own company-branded products that currently exist in the market.

4.2.2 Bimbeads Concept Designs2 Among the celebrated women entrepreneurs in Nigeria is Mrs. Bimbo Balogun, owner of Bimbeads Concept Designs. Her story is fascinating and causes one to wonder whether her success is one of luck or something else. This is because she is described in news headlines as “the entrepreneur who sold two necklaces and never looked back” because she made a fortune. She holds a degree in Petroleum Marketing and studied Entrepreneurial Management as one of the scholars on the Goldman Sachs 10,000 Women initiative; these show that there is much more than fate to growing her business. Established in 2006, Bimbeads is primarily involved with the production of beaded jewelry using rare gems. Over its 12 years of existence, the organization has grown from an initial investment of 400 naira to a net worth of 5 million naira following reinvestment of the about 1000 percent profit she made on her initial production at start-up. The business emerged from a desire to keep busy following failure by the owner to find a job in her area of specialization. To date, the organization has five employees, two outlets in Lagos, Nigeria, and includes not only a production line but also a magazine business and a training institute. Bimbo believes in empowering others to take their destiny into their hands like she did. Through her magazine, she shares excerpts of her  This case was written using data from secondary sources. Below is a list of sources referred to: Iwuoha, John-Paul. 2013a. Bimbeads Concept: How a bead jewelry making hobby became a million naira business. 14 March 2013. http://www.smallstarter.com/get-inspired/bimbeads-concept/ (Accessed 30 August 2018); https://bimbeads.com (Accessed 30 August 2018); BBC, British Broadcasting Corporation. 2012. The Nigerian woman who sold two necklaces and never looked back. 22 June 2012. https://www.bbc.com/news/world-africa-18535002 (Accessed 30 August 2018). 2

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entrepreneurial journey and tips on how one can succeed in her industry. Market positioning, specifically breaking into the top tier of the market, constituted one of the major challenges she faced as a start-up entrepreneur, but this did not deter her. She exhibited traits of consistency, passion and hard work, which she reports, in an interview with the British Broadcasting Corporation, contributed to her success. Bimbo adopted a myriad of strategies to overcome her frustrations. The first focused on building her personal brand by enlisting to host a talk show, which enhanced her popularity and impacted the business positively. Secondly, her active involvement in networks served her well. She reports that her engagements with the Nigeria Network of Entrepreneurial Women (NNEW) “helped her take a bold step to get an outlet for her training business and overcome her fears”. Further, Bimbo pursued education as a strategy to managing her concerns. She understood that for her to succeed, she needed to produce quality; hence, she engaged herself in formal and informal education on the technicalities of making beaded jewelry and managing a business. According to her, she did not have bead-­making skills on entering the business, but she learnt on the job and consistently researched on designer websites for ideas. Her business thrives on the development of an innovative differentiation strategy that allows her to sell at a premium to high-end clients. Moving forward she hopes to expand her outlets locally and internationally.

4.2.3 Cassava Processing in Ghana3 In rural Ghana, Cassava farmer and processor Faustina Sakyi  made great strides for herself, her family and society. She has been recognized by many, including  the International Fund for Agricultural Development, which gave her the award of Best Cassava Farmer in Ghana in 2008. Before her big break, Faustina was not new to the food processing industry. Her desire to pursue a career in this industry stemmed  This case was written using data from secondary sources. Below is a list of sources referred to: Iwuoha, John-Paul. 2013b. Faustina Sakyi – The Ghanaian cassava farmer who turned her world around. 14 March 2013. http://www.smallstarter.com/get-inspired/faustina-sakyi/ (Accessed 30 August 2018); Samil, Roxanna. 2010. Ghana has another Yaa Asantewaa: A powerful lady cassava producer and community leader sets up shop in rural Ghana. 9 November 2010. ifad-un.blogspot. com/2010/11/ghana-has-another-yaa-asantewaa.html (Accessed 30 August 2018). 3

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from her perceptions of desirability and feasibility for the industry as she worked with her mum at the early age of eight. At the time, they processed cassava by hand and she learnt not only the skill but also developed the passion to change things in the future. In 1998, she started her business with the desire to grow it and earn enough to take care of her children. Faustina understood how to mobilize different types of resources to her benefit. With an initial capital investment of 250 Ghanaian cedis which she invested in machinery and 36 women cassava farmers in her locality who already owned lands for farming, Faustina was able to create an innovative win-win business model for the industry. By collaborating with her competitors, Faustina was able to secure both employment for the women she worked with and a constant supply of processed cassava for her clients. It is obvious from secondary data sources that Faustina’s challenges included access to finance. She managed to overcome this concern by securing a loan from a rural bank in her community and reaching out to IFAD for support with machinery. It is possible that her “excellent book-­ keeping skills” and her experience working with other women in the industry gave her credibility for success with her loan application. She used the loan received to secure her raw materials. Faustina now sits on steering committees for IFAD’s Root and Tuber Improvement Programme and has certification for her products after receiving the award of Good Practice Centre for her factory. These put her in a good position for business, thus leading to an annual yield of GHC 187,200. In the near future, she hopes to become “the big and best cassava processor” in Ghana.

4.2.4 Dreamland Piggery4 Known as the celebrity pig farmer, Anna Phosa is one of the few black female commercial pig farmers in South Africa. Her entrepreneurship  This case was written using data from secondary sources. Below is a list of sources referred to: Iwuoha, John-Paul. 2013c. Pigfarming. How this business is changing lives in Africa and everything you need to start your own. 23 August 2013. http://www.smallstarter.com/get-inspired/how-­ to-­start-pig-farming-in-africa/ (Accessed 30 August 2018); Gospel, Emeka. 2018. How Anna Phosa Became one of Africa’s Biggest Pig Farmer. February 26, 2018. https://myafribusiness.com/ anna-phosa-became-one-africas-biggest-pig-farmers/ (Accessed 31 August 2018). 4

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story emphasizes the need to take advantage of opportunities that come our way for success. Following a difficult life as a child and her desire to make life better for herself and her family, Anna established Dreamland Piggery in 2004. Her business involves the rearing and dressing of pigs for sale, a venture she invested in following earlier entrepreneurial efforts in vegetable farming and chicken rearing with her husband. Like many others, funding was a problem. Nevertheless, her personal saving ability enabled her to raise 1000 South African Rand as start-up capital. Through persistence, Anna actively sought opportunities to do business with organizations within her community. Soon after business started, her organization landed a contract to supply ten pigs per week to a major supermarket chain in South Africa. Within the space of six years, the size of this contract grew, as Anna demonstrated excellence in her dealings with this organization. By 2010 she had secured a five-year contract to supply 100 pigs per week, totaling a value of 25 million Rand—an amount she reinvested and supported with loans to grow her business. In interview reports on Anna and her organization, it is obvious that finance was not the only problem faced as a woman entrepreneur. At the early stages of her business, she highlights lacking skills in her chosen field of business and the effort she had to put into teaching herself. She read a lot of books and benefited from the support of experienced farmers within her network of friends. In 2006, she was awarded best female farmer of the year in her province. In the years following, she received several recognitions for her hard work in growing her organization into something remarkable. Today, Dreamland Piggery supplies more than 300 pigs per week, bred internally and bought from other pig farmers, to varied organizations. Its stock has grown from a small number of 4 pigs at start-up to 4000 pigs catered for on a 778-acre farm that employs at least 20 people locally. It is Anna’s hope that soon she can expand to other parts of Africa and build a brand that can stand the test of time.

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4.2.5 Pauline Cosmetics5 “I’m proud of having built a local cosmetic brand that is competing neck to neck with international companies in the market” (biznakenya.com), says Nelly Tuikong, owner of Pauline Cosmetics. Her organization focuses on the production and sale of cosmetics tailored to the African skin. To date, she has grown her organization through product, service and process innovations, which enable her to satisfy multiple clients in urban and remote parts of Kenya. Having specialized in critical care nursing, Nelly worked full-time for others in the past. She decided to pursue entrepreneurship in Kenya solely because she saw a gap in the cosmetics market through her personal experiences that needed to be filled. However, she lacked skills in make-up artistry and the cosmetology industry at start-up. Therefore, she recalls having to read a lot from encyclopedias in order to understand cosmetic ingredients and receive customized training from a celebrated make-up artist, whom she confidently engaged without fear. These personal efforts were supported with extensive market research conducted over years involving experimenting in her kitchen, talking to people, creating and testing samples, and taking advice from chemical engineers before opening the company’s doors to the market in 2013. Nelly reports that some of her major challenges faced include dealing with mishaps in the Kenyan regulatory environment such as those associated with clearing imported goods and services at the port, creating demand for her products, finding avenues to stock her products and finance. Despite these challenges, she has managed to transform her business, learning on the job and using bootstrapping strategies like limiting product range and using mainly word-of-mouth marketing at start-up. Major contracts like a consignment of 50,000 pieces of Pauline Cosmetics won in 2013 and others of 20,000 pieces and 35,000 pieces won in the  This case was written using data from secondary sources. Below is a list of sources referred to: http://paulinecosmetics.com (Accessed 31 August 2018); Genga, Shirley. 2013. Homegrown Beauty. http://www.standardmedia.co.ke/lifestyle/ssrticle/2000093551/homegrown-beauty (Accessed 31 August 2018); Bizna. 2017. My Entrepreneurial story as  The  Founder and  CEO of  Pauline Cosmetics. 31 October 2017. https://biznakenya.com/entrepreneurial-story-founder-­ ceo-pauline-cosmetics/ (Accessed 31 August 2018). 5

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next two years following have catalyzed her ability to grow exponentially from an initial investment of just $400. She is bent on growing her organization from a presence in 25 stores locally and a workforce of nine employees to something bigger that will generate at least $500,000  in sales moving forward. Her focus for the future is to make cosmetics more of an experience than just a product line. This is likely to earn her more awards in addition to the recently won Youth Entrepreneur of the Year award in Kenya in 2017. In the near future, Nelly sees herself and her organization venturing into skin care and consulting.

4.3 Lessons Learnt 4.3.1 Impact Per the definition of Schoar (2010), three out of five of the entrepreneurs studied could be considered business owners rather than self-employed individual because they employed more than 10 people (e.g. Amalena employs 121, while Faustina and Nelly employ 36 and 20, respectively). Similarly, although the other two had only five and nine employees, they had consistently showed that they were able to add paid employees to their organization and expand their business—characteristics that Schoar (2010) argues are crucial in identifying transformational entrepreneurs. Therefore, entrepreneurs within the studied cases did not necessarily do the jobs themselves but played a managerial role, which freed up time for them to do other things. This may be a reason why work-life balance did not feature as a major challenge for them despite its importance in the literature on women entrepreneurship. Comparing the five case studies, it can be identified that all studied entrepreneurs possessed qualities of high willingness to take risks and high managerial and financial literacy in line with findings from the baseline survey by de Mel et al. (2005) on transformational entrepreneurs. The studied entrepreneurs were also willing to put themselves in unfamiliar situations, a characteristic suggested by Schoar (2010) to be possessed by transformational entrepreneurs. Of the five entrepreneurs, three were

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willing to start businesses in a field completely new to them. Among the two who stayed in their comfort zone when it came to the choice of industry, there was evidence of innovation and willingness to challenge the status quo despite opposition. Further, results from this cross-case analysis showed higher returns to capital in line with the study by de Mel et al. (2005) on the potential that self-employed individuals with characteristics similar to transformational entrepreneurs have in growing their capital. It is interesting to note that entrepreneurs like Bimbo did not question the ethics of making a 1000 percent profit on her product, but instead took advantage of the opportunity to grow her business. Assertions made by Ardagna and Lusardi (2010) in their study on the characteristics of transformational entrepreneurs using data from the Global Entrepreneurship Monitor (GEM) is validated in this study as all five entrepreneurs are found to have good literacy levels and no fear of failure. This was evidenced in their ability to participate in leadership positions, keep records or possess university degrees.

4.3.2 Entrepreneurial Challenges It was observed that access to capital was an issue of concern to most of the entrepreneurs at start-up. This is in line with arguments by Schoar (2010) on capital constraints being a major challenge facing transformational entrepreneurs in developing countries. It is also noted that only in two cases were bank loans used in venture financing, with no use of microfinance for funding their organizations. But this should not be a cause for concern, since Banerjee et al. (2009) found no impact of micro credit on firm growth in the India case. Despite this, the entrepreneurs were resourceful in mobilizing a variety of resources and strategies to help them succeed. To secure financial resources, the studied entrepreneurs limited themselves to personal savings or support from family and friends, no matter how small it was. They understood the principle of starting small, but were not opposed to growth—working consistently to achieve it through reinvestment of profits. This was not a bad strategy per se; however, it seems that it had an implication on the time it took them to grow, with findings showing that these entrepreneurs collectively grew

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within an average time period of 13 years. Amalena had a 40-year period to grow, but it was for only 12 of those years that Anita took over the business to kick start the exponential progress. On the other hand, Nelly made much progress in five years, with an additional time period of about four years spent in research and relocation. These lead to questions of whether the transition time could have been shorter should financial support have been provided earlier, whether the entrepreneurs would have been prepared to know how to utilize it judiciously and when in the life cycle of a new venture should such financial support be given. Answers to these questions would be beneficial for policy making. Concerning the second challenge of regulatory constraint, there is limited data available to enable an accurate analysis. Nevertheless, two of the entrepreneurs suggested that regulation was a problem when they made reference to the revenue authority and the customs division. What stood out in all five cases was the existence of self-regulatory mechanisms from the industry and clients that fostered or hindered growth. In the Amalena case, for example, the association of traders in the children clothes and accessories business as well as the clients created resistance to own-branded products as an expansion strategy. In the Bimbeads case, engagements with NNEW encouraged risk-taking behaviors associated with growth, like getting an outlet to operate in.

4.4 Conclusion The above cases are just a few of the many stories of female entrepreneurs who have successfully grown their businesses from MEs into giants that rub shoulders with international organizations. There is a need to study more of these—those documented in secondary literature and those located in remote areas in African communities—before generalizations can be made. Despite this, there are themes that emerge which could provide useful lessons or trigger further research in the quest to help grow MEs. First, it is evident from the cases that female entrepreneurs can play a role in the transformation of Africa through entrepreneurship. Increased levels of sales, profitability, internationalization and job creation demonstrated in this study indicate the potential female entrepreneurs have to

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contribute to economic development. However, it is clear that the female entrepreneurs studied here are not interested in the western construct of economic development (e.g. contribution to gross domestic product, GDP), but rather in real qualitative impacts that will lift themselves, their families and individuals in their immediate communities from poverty. To this end, women, when compared to men, may have a higher tendency to champion the transformational entrepreneurship agenda of establishing businesses with both economic and social motives (Meyskens et al. 2011). Secondly, it appeared in all five cases that initial business success spurred the desire to grow and reinvest profits to support this. This, to a large extent, depended on getting the opportunity right and the ability of the entrepreneur to market it in a way that created demand for success. Social networks, involving predominantly family, friends and other entrepreneurs, provided synergy for growth and created some form of reputational resource for entrepreneurs to tap into in an attempt to overcome the challenge of creating demand for their products. Nevertheless, it seemed that entrepreneurs in the study did not fully capitalize on the benefits of social networks for entrepreneurial success. Actors like suppliers, buyers, government, incubators, entrepreneurship education and training providers, financial institutions and financial intermediaries, per the information available, were not actively engaged before or during the entrepreneurial process (Jenssen 2001). Within the family, friend and other entrepreneur network used, emphasis was placed on acquisition of technical and entrepreneurial knowledge, marketing and publicity. It is recommended that entrepreneurs strengthen their relationships with actors not fully engaged and explore ways they can capitalize on the social capital (e.g. access to additional sources of financing, strategic alliances, access to knowledge and innovation capabilities, etc.) embedded in these networks. Further, entrepreneurs in this study and their businesses could benefit immensely (e.g. gain access to new skills, markets and technologies) from digitalization and the uptake of information and communication technologies in their activities.

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References Ardagna, S., & Lusardi, A. (2010). Explaining International Differences in Entrepreneurship: The Role of Individual Characteristics and Regulatory Constraints. In J.  Lerner & A.  Schoar (Eds.), International Differences in Entrepreneurship. Chicago: University of Chicago Press (for NBER). Banerjee, A., Duflo, E., Glennerster, R., & Kinnan, C. (2009). The Miracle of Microfinance? Evidence from a Randomized Evaluation. Working Paper. Cambridge, MA: Massachusetts Institute of Technology. de Mel, S., McKenzie, D., & Woodruff, C. (2005). Returns to Capital in Microenterprises: Evidence from a Field Experiment. Quarterly Journal of Economics, 123(4), 1329–1372. Henry, C., Foss, L., & Ahl, H. (2015). Gender and Entrepreneurship Research: A Review of Methodological Approaches. International Small Business Journal, 34(3), 1–25. Jenssen, J.  I. (2001). Social Networks, Resources and Entrepreneurship. International Journal of Entrepreneurship and Innovation, 2, 103–109. Maas, G., Jones, P., & Lockyer, J. (2016). Position Paper: International Centre for Transformational Entrepreneurship. Working Paper. Coventry: Coventry University. Marmer, M. (2012). Transformational Entrepreneurship: Where Technology Meets Social Impact. Harvard Business Review. Meyskens, M. I., Elaine, A., & Brush, C. G. (2011). Human Capital and Hybrid Ventures. In G.  T. Lumpkin & J.  A. Katz (Eds.), Social and Sustainable Entrepreneurship (Advances in Entrepreneurship, Firm Emergence and Growth, Volume 13) (pp. 51–72). Bingley: Emerald Group Publishing Limited. Minniti, M. (2009). Gender Issues in Entrepreneurship. Foundation and Trends in Entrepreneurship, 5(7–8), 497–621. Schoar, A. (2010). The Divide Between Subsistence and Transformational Entrepreneurship. National Bureau of Economic Research. Chapter URL: http://www.nber.org/chapters/c11765, pp. 57–81.

5 Case Study: Transformational Entrepreneurship in Australia CyRise: A University and an IT Service Provider Join Forces to Tackle Cybercrime Heather Round

Abstract  This chapter provides a case study of a cybersecurity accelerator, recently established in Australia, in response to the growing threat of cybercrime. The accelerator has been launched as a joint venture between an IT service provider and a university, with the backing of the regional government. In setting up and differentiating the accelerator particular attention has been paid to the deal flow quality, selective engagement of a broad range of mentors with deep skills and the establishment of an environment conducive to innovation. As will be discussed in this chapter, these factors increase the likelihood of success based on developing strong and dynamic networks, building founders’ skills and increasing collaboration within the ecosystem. This chapter demonstrates how the principles of transformational entrepreneurship are being utilised within this context to build a successful accelerator to tackle a challenging situation.

H. Round (*) Deakin University, Melbourne, VIC, Australia e-mail: [email protected] © The Author(s) 2019 G. Maas, P. Jones (eds.), Transformational Entrepreneurship Practices, https://doi.org/10.1007/978-3-030-11524-1_5

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Keywords  Transformational entrepreneurship • Accelerator • Entrepreneurship • Innovation

5.1 Introduction Against the backdrop of increasing international terrorism events, very public security breaches and an increasingly sophisticated cyber hacker network, the emphasis on cybersecurity is on the rise. Compounding the situation is the ongoing shortage of skilled resources to tackle cybersecurity issues, with the National Audit Office (NAO) stating in 2013 that it could take up to twenty years to address the skills gap, leaving organisations and government institutions vulnerable (Cardwell 2013). Given that information security and in particular cybersecurity are relatively new industries, finding experienced, professional and diverse resources continues to be a challenge (Furnell et al. 2017). The International Organization for Standardization (2012, p.  4) describes cyberspace as a “complex environment resulting from the interaction of people, software and services on the Internet by means of technology devices and networks connected to it, which does not exist in any physical form”, while cybersecurity can be defined as information security applied specifically to cyberspace (Sutton 2017). With skills in short supply and the definition of cyberspace and cybersecurity illuminating the complexity involved in responding to these threats, tackling cybersecurity may be considered a classic example of a “wicked problem”. A wicked problem is one that has “innumerable causes, is tough to describe, and doesn’t have a right answer” (Camillus 2008, p. 100). In order to respond to this wicked problem, transformational entrepreneurial thinking is required. An initiative recently established in Melbourne, Australia, aims to engender exactly that type thinking. This chapter is structured around the way in which a cybersecurity accelerator—CyRise—has been set up for innovation, creativity and transformational entrepreneurship. In particular the chapter looks at how dynamic networks are built, new skills are developed and active

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c­ ollaboration among components of the system is fostered, which have been shown to be essential to entrepreneurial outcomes (Kitson et  al. 2009). Amongst others, this chapter will have relevance for government bodies interested in promoting entrepreneurship within their jurisdiction, universities struggling with industry engagement and commercialisation challenges, and organisations that are looking for a depth of research and development skills but are struggling to attract and retain this specialised talent.

5.2 The Australian Context In the past Australia has relied heavily on the resources boom to underpin economic growth, but as the international demand for commodities has softened, the focus has slowly begun to shift to other areas such as services (Australian Industry Report 2016). Evidence of the shift away from resources can be seen in recent government reports of services accounting for 60% of gross domestic product (GDP) and employing 9.4 million people in 2015–2016 (Australian Industry Report 2016). Policy makers and strategists understand the imperative for Australia to move away from a resource-based economy more quickly than has been done to date, in order to compete internationally in future. Outlined in the government-­ backed plan for future development—Australia 2030: Prosperity through Innovation (Innovation and Science Australia 2017)—are thirty recommendations to capitalise on innovation in order to scale up more high-­ growth industries, commercialise more high-value products and services, develop great talent and tackle global challenges. In order to achieve this, Australia needs to transform itself into a digital economy, sometimes called a third-generation economy. A digital economy may be described as a platform, based on the internet, mobile networks, sensor networks and e-commerce, which enables a global network of economic and social activities (Australian Bureau of Statistics 2015). Inherent in embracing the concepts of the digital economy is innovative disruption as well as increased vulnerabilities and threats to individuals, communities and services within Australia—in particular, the increased potential for

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c­ompromise by cybercriminals and cyberterrorism within the increasingly complex, integrated, distributed digital world. According to the World Economic Forum (2018), cybercrime was predicted to cost the global economy US$445 billion in 2017, a figure which is set to rise going forward (Hui et  al. 2017). Over the past few years cyberattacks have been increasing in Australia, and according to the Australian Cyber Security Centre, between 2011 and 2014, attacks on the Australian government alone have risen by more than 260% (Australian Cyber Security Centre 2015). In addition, the situation is compounded by the increasing skills shortage being experienced in the area of information technology and in particular cybersecurity (Furnell et  al. 2017). So in many ways, within Australia, there are the conditions for a “perfect storm”, with a strong push to innovate and transform to a digital-based services economy, which brings with it the concomitant increased cybersecurity threats and a lack of depth of skills to draw upon to address the situation. This chapter will focus on one initiative which encompasses the principles of transformational entrepreneurship in order to respond to the challenge which has been outlined above. CyRise, a cybersecurity accelerator, established in partnership between industry and academia, will be discussed next, but prior to this a short overview of the start-up space in Australia will be provided.

5.3 Entrepreneurship in Australia Within Australia the driving need for entrepreneurship and innovation and the support for start-ups can be explained based on an economic view. This view encompasses the fact that there are fewer government levers for stimulus, growing national debt, interest rates approaching zero (monetary policy can no longer dial up the growth needed), declining manufacturing and increasing underemployment, which all point to the need for innovation and entrepreneurship. An important component to consider in increasing entrepreneurship and innovation within Australia is the role of the education sector. In particular the higher education sector has been called on to support a

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positive vision for Australia by focusing on entrepreneurship and innovation in order to prepare students for jobs of the future. According to the GUESSS report (Sieger et al. 2016) 32.8% of Australian students want to start a business within five years, which indicates a strong demand from students for entrepreneurship skills, and thus in order to ensure that students are job ready, universities need to ensure not only that they are developing students’ capacity for innovation but also that they are equipping students with the entrepreneurial skills required in order to be part of the innovation economy. A report commissioned by the chief scientist of Australia provides a good way of explaining the role of universities in the area of innovation and entrepreneurship within Australia (Kinner 2015). The report views the student entrepreneurial experience as a funnel, with the level of exposure to entrepreneurship correlating to the potential entrepreneurial outcomes. At the most generic level providing students with an awareness increases their ability to participate in the technology-driven, increasingly complex business environment. At the higher levels universities can equip students with the skills to innovate within organisations or initiate new, innovative undertakings themselves. In order to do this, universities need to provide exposure to the start-up world through, for example, becoming involved in incubation or acceleration of start-ups. In addition, universities need to consider the integration of activities to support entrepreneurship across the entire university in order to amplify the impact they can have in the start-up space. The chief scientist’s report (Kinner 2015) provides a way of measuring (based on six stages) the maturity of entrepreneurship education. The six stages can be represented as follows: • Stage one: a single course is offered to students • Stage two: an incubator or similar events are supported • Stage three: curriculum is expanded, with entrepreneurship at the centre • Stage four: broad curriculum is developed with the engagement of the local start-up community • Stage five: campus-wide infusion of entrepreneurship is evident

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• Stage six: there is integration across faculties and entrepreneurship is seen as part of the institutional identity While some Australian universities are already approaching the later stages, it could be argued that many Australian universities are still at Stage two or three. The initiatives of the higher education sector in terms of stimulating the start-up sector need to be contextualised within the entrepreneurial ecosystem. Education may be seen as one of the stages (or zones) of entrepreneurship, with incubation and growth being others. Working together, these stages/zones provide the foundation for entrepreneurship and innovation to flourish within a region. There has been an escalation of activity in the start-up space in Australia over the past few years, with an increase in the number of accelerators and incubators emerging within each of the major centres across the country (Seet et al. 2018). Most of these have a broad innovation agenda and attract founders from a wide range of disciplines. Some of the earliest pioneers in this space include Startmate, Angel Cube (now owned by Slingshot), Ignition Labs and BlueChilli, to name but a few (for a more comprehensive list see https://blog.thefetch.com/start-up-incubatorsand-accelerators-in-australia/).

5.4 About CyRise CyRise, established in mid-2017 as a joint venture between Deakin University and Dimension Data, aims to be the number one cybersecurity accelerator in Australia. The initiative brings together the diverse skills and resources of both partners in order to achieve innovative and creative outcomes. Dimension Data, a member of the Nippon Telegraph and Telephone (NTT) group, has a depth of knowledge and experience in digital infrastructure and hybrid cloud technologies and a strong commercialisation focus (www.dimensiondata.com). Deakin University, which is ranked in the top 2% of the world’s universities (according to Ranking of World Universities, Times Higher Education, QS World University Rankings), has significant expertise in the area of cybersecurity research and education.

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Rather than just providing funding for the establishment of CyRise, the two partner organisations, Deakin University and Dimension Data, are embedded in the operation and jointly accountable for the success of the accelerator. This three-way partnership provides a unique structure which holds in creative tension the goals and aspirations of the venture with the commercial realties and the market demands in order to achieve positive outcomes. The partners aim to achieve both social and economic impact through launching a successful cybersecurity accelerator. Underpinning the venture is government support in the form of a grant from LaunchVic (https://launchvic.org/), an independent agency established by the Victorian government in March 2016 and tasked with developing a start-up ecosystem within the Victorian region of Australia. The start-up ecosystem is made up of founders, investors, start-up teams, community organisations, corporate partners and government (Feld 2012). LaunchVic is based on the strong Australian government commitment to entrepreneurship and the assumption that amplifying the start­up ecosystem by collectively creating a pipeline of successful start-ups will have a positive impact on jobs and gross domestic product in Australia in the long term. LauchVic’s aspirations align strongly with the CyRise aim of having social and economic impact through skills creation, product development and the establishment of an ecosystem to tackle cybersecurity challenges in the region. As part of establishing a viable accelerator and focusing on success, a CEO was sought with specific start-up skills. Scott Handsaker was appointed as CEO in 2017 and given responsibility for the establishment of the acceleration programme. Handsaker not only comes with strong entrepreneurial skills, but is also deeply connected with the local start-up community, having co-founded Start-up Victoria (a not-for-profit focused on helping Melbourne become a world-class start-up ecosystem). Kirstin McIntosh joined Handsaker as part of the CyRise team early on in the first programme. McIntosh is the programme manager and has start-up experience herself as well as having facilitated in building entrepreneurial ecosystems in various global regions.

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5.5 T  he CyRise Difference: Transformational Entrepreneurship Research suggests that the success rate of start-ups is limited, with, depending on the industry, up to 70% of start-ups failing within the first five years (Gruber and Henkel 2006). In reviewing CyRise a number of key differentiating factors emerge which together make the accelerator more likely to achieve success. In particular, this section looks at the aspects of CyRise which facilitate the building of dynamic networks, development of new skills and foster collaboration among components of the system, all three of which have been shown to be essential to entrepreneurial outcomes (Kitson et al. 2009).

5.5.1 The CyRise Culture and Ethos CyRise differentiates themselves from other accelerators not only in their vertical focus but also in the way in which the accelerator has been set up and is managed on an ongoing basis. The three key aspect of differentiation can be described as utilising similar content but focusing on different outcomes, the individuals who are selected to participate and the individuals involved in the running of the programmes. One tangible difference with CyRise is the length of the accelerator programme. Whereas most programmes are based on a three-month cycle (Radojevich-­ Kelley and Hoffman 2012), CyRise has elected to have a six-month programme. This extension of the programme was justified based on the embryonic stage of the specific cybersecurity ecosystem in Melbourne currently. Taking this into account a conscious decision was made to accept individuals into the programme who are still very much in the ideation phases, rather than only those who have more developed ideas and are ready to scale, and to work with them for longer in order to grow their ideas. In this sense the organisations supporting CyRise and the team running the acceleration programmes understand that what they are doing is also contributing to building a cybersecurity ecosystem which can provide the foundations for economic, innovative and technological advancement in the region. As the ecosystem develops and grows more

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sophisticated, there may be an opportunity to review the timeframes of the accelerator but, based on the current climate, six months appear to be a reasonable timeframe. One of the challenges with having a longer acceleration programme is to ensure that the founders do not become complacent and that the time is well spent. In order to focus on different outcomes and drive success, Handsaker instils a sense of urgency in each of the start-ups throughout the programme, maintaining their focus and keeping them to an agenda. As part of developing an environment within which innovation and entrepreneurship can flourish, Handsaker deliberately developed the following four values within CyRise to act as cultural pillars: • Raise your standards—CyRise founders are capable of world-class entrepreneurship and need to understand what world class looks like in order to aim for this • Radical transparency—this incorporates the way in which individuals interact and includes candour, direct feedback and empathy • Give before you get—in order to develop an ecosystem and a community, individuals need to be generous in giving to others • Seek truth—as part of ongoing innovation and entrepreneurship, question existing assumptions and overturn entrenched thinking in order to find the truth The ethos and culture being actively developed within CyRise promote collaboration through the longer time that the founders spend together and the values which encompass cooperation. In addition the longer time scale of the accelerator means that there is more time for developing critical skills, which founders will require once they exit the programme.

5.5.2 Strategic Mentorship and Networking Recruiting mentors is a key part of setting up an accelerator programme; however, many of these are fairly loosely managed and mentors are not rigorously vetted for their suitability. From the start CyRise has set high standards for mentorship as one of the key aspects of differentiation.

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Being selective when mentors are volunteers could be a challenging prospect, as some of the best placed mentors are most likely to be the busiest and most in demand too. Recruiting mentors for CyRise was facilitated by Handsaker’s deep network and credentials in the start-up and entrepreneurial community. In particular, mentors within CyRise are sought who not only have existing skills relevant to the cybersecurity sector but also encapsulate four characteristics which are consistent with the ethos of the accelerator. These mentors need (1) to be deeply credible in the cybersecurity start-up space, (2) to have a “give before you get” philosophy, in other words, to be in it for the right reasons, (3) to be high performers and (4) to have a depth of experience and the “scars” to prove it. Thus mentors within CyRise are very much selected based on both fit with the values of the accelerator and their specific set of skills. While CyRise mentors have a common ethos around giving back, growing talent and establishing the ecosystem, they contribute in a number of different ways based on their own constraints and availability. Those who are particularly time poor may run one-off workshops with all the accelerator participants. Others may be involved in what are called “mentor whiplash”, that is, short informal meetings which are arranged for the founders with a number of mentors back to back. Finally there are the one-on-one mentors who are allocated to a particular team within the accelerator (two mentors per team) and who make themselves available to the team on an ongoing basis throughout the programme. There are expectations set with the start-up teams in terms of how to engage their mentors and this includes providing a weekly update on their progress, which also assists in creating the sense of urgency and focus which was previously discussed. Understanding what mentors are getting from the experience is a key part of developing the mentorship model on an ongoing basis and, in order to do this, the CyRise team have been interviewing individuals who mentored the first cohort. Emerging from these discussions are themes around the personal gratification of being involved in developing talent and contributing to building the ecosystem. Mentors are energised by interacting with individuals who are talented, inspired and innovative. While the cohort are highly positive about the role of mentorship, most

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mentors are consistently modest about their contribution and see themselves as mostly responsible for stimulating thought-provoking conversations. As part of ramping up for the next cohort the CyRise team will be adding to the existing base of mentors, continuing to recruit based on fit with the values of the accelerator and the specific skill set of the individual. An activity which is likely to be facilitated by the increasing profile of CyRise and the team’s growing knowledge of the cybersecurity sector. Recognising the importance of embedding the founders in not only the local ecosystem but also a global network of innovative thinkers, the six-month programme is structured around two international trips. The first of these is to Israel, which is seen as a cybersecurity powerhouse at the centre of an $82 billion industry (Press 2017). This trip gives CyRise founders access to deep thinking about cybersecurity, technology, as well as the opportunity to develop networks and connections. The second trip is to the USA, which is has a distinct concentration of fast-growing, successful start-ups (Cohan 2017) and provides the perfect opportunity for founders to refine the commercialisation aspects of their product. Being strategic about selecting mentors is a large component of facilitating a strong network, and continually reviewing and refreshing the mentor base ensures that the network remains dynamic and relevant. Mentors come with existing networks, and by connecting founders with a range of mentors, CyRise is inserting the start-ups into a reputable and useful network. By extending the connections to key international regions, the network is enhanced. In addition, given the emphasis on the skills of the mentors and the extended timeframe of the programme, mentors are able to spend more time with founders, building their entrepreneurial skills during the programme.

5.5.3 D  eal Flow Quality as a Basis for a Strong Programme In addition to being keenly focused on recruiting the best fit of mentors, the CyRise team are also very careful about who is accepted into the programme. Underpinning this is the assumption that a high standard within the cohort will translate to stronger long-term outcomes from the

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acceleration programme. Advertising for the accelerator programme is done through the Melbourne-based start-up communities, meetups, hackathons, conferences and other general entrepreneurial-based events. Handsaker also believes that a deeper understanding of the cybersecurity ecosystem will assist in developing the diversity of the accelerator “deal flow”, which will have positive benefits for the cohort in terms of innovation. Apart from events, the network based on partners and mentors is a key focus as part of the recruitment campaign. The CyRise team also actively follow up with any individuals who have expressed interest through the various channels in the past to see if they are in the position to apply for the next programme. The deal flow sourcing activities happen over a two-month period and predominantly focus on identifying potential applicants and selling the programme to them. Handsaker is pivotal in this process, making his calendar available publicly to anyone who would like to discuss their idea with him. For those individuals who he identifies as being high potential, Handsaker aims to demonstrate the value of the accelerator long before the individual applies. In identifying potential applicants, similar to the mentors, there is a focus on the individual’s skills and their fit with the values of the accelerator. Successful applicants need to be technically competent and be able to build the technology within the accelerator rather than having to rely on others to do this. In addition, successful applicants need to have a depth of knowledge of cybersecurity and a passion for solving problems in this sector. Once accepted onto the programme founders are required to be located at the accelerator in downtown Melbourne for the full extent of the programme. The philosophy is that, through co-location, comradery is built, networks are developed and collaboration is encouraged. During the programme Handsaker acts as an “entrepreneur in residence” for the whole cohort. This includes individual meetings at the start of each week where the founders are required to set out their plans, activities and challenges. This is part of the progress of structured accountability within the accelerator and also assists in keeping the cohort focused and maintaining the ongoing sense of urgency. Weeks are bookend with meetings—the one-­ on-­one meetings at the beginning of the week and a “team huddle” at the end of the week. Social events throughout the programme act to bind the

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team together and develop the team spirit; this is an important aspect of balancing workload pressures which may be experienced by the cohort, especially as the end of the programme starts drawing nearer. The international trips, taken during the program, also play an important role in binding the team and developing the social capital within the cohort. This not only is important for the duration of the programme but is particularly relevant for expanding the cybersecurity ecosystem. Being surrounded by a cohort who have deep technical skills, together with the collaborative environment, facilitates skills transfer and allows founders to extend themselves technically while in the programme. In addition, having an experienced, accessible entrepreneur in residence allows founders to identify areas for skill development and focus on building these during the programme.

5.6 The Next Steps for CyRise The CyRise team encompass the four key values themselves and, in the spirit of continually raising standards, continually review, reflect and consider how the programme may be modified in order to achieve the CyRise vision. In particular the specific vertical focus raises some distinctive challenges, while the organisations involved in the partnership offer some unique opportunities for CyRise.

5.6.1 Amplifying R&D Capability Start-ups founded by CyRise have the benefit of being nimble and are able to respond quickly to feedback or new sources of information in order to change their products or offerings. This provides them with a unique competitive advantage. However, as argued by Weiblen and Chesbrough (2015), this agility is offset against a constraint in terms of accessing resources. In particular many start-ups struggle to invest in research and development (R&D) (de Jong and Freel 2010), which is crucial to their success. Having an association with a university provides the opportunity for CyRise participants to access research and

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­ evelopment capacity far in excess of what their own limited resources d would allow for. Key to achieving this is the establishment of “academic engagement”, which is defined as “knowledge-related collaboration by academic researchers with non-academic organisations” (Perkmann et  al. 2012, p. 424). Research on academic collaboration shows that achieving beneficial outcomes requires a complex range of factors to be in alignment. This includes individual factors such as demographics (Giuliani et al. 2010; Goktepe-Hulten 2009) and networks (Haeussler and Colyvas 2011), as well as organisational factors such as the existence of a mechanism for technology transfer (Markman et al. 2005). Overarching these factors is the prevalent instructional environment, which has also been shown to have an impact, including areas such as access to funding (Haeussler and Colyvas 2011) and the level of competition (Goldfarb and Henrekson 2003). In other parts of Deakin University’s entrepreneurial ecosystem, for example, in a high-tech advanced manufacturing hub, academic engagement and industry alignment is achieved by having students do internships with the start-ups and also by having PhD students working on some of the challenges encountered by the start-ups. This has a twofold advantage in that not only the start-up is able to access the advanced research capability of the university but also the students are exposed to real-life scenarios and are able to develop relevant workplace skills. The success of this collaborative model is evident in the positive outcomes within the start-ups and also in the number of students who are employed by the start-ups once they complete their studies. Achieving greater integration between the university and the accelerator programme is one of the key opportunities for CyRise to continue to develop and differentiate themselves on an ongoing basis.

5.6.2 Increasing Open Innovation A key aspect of start-up success is in opening the individuals who have founded the enterprise to external sources of knowledge. Researchers (Carlsson and Corvello 2011; Eftekhari and Bogers 2015; Kask and Linton 2013) have found that openness to external knowledge sources

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and the creation of business innovation networks are two of the most critical factors in the success of enterprises in the start-up phase. This is a good example of the open innovation paradigm which Chesbrough (2006) theorised, which allows organisations to open up their innovation processes in order to leverage both internal and external sources of knowledge. As do other accelerators, CyRise employs the commonly accepted means of engendering open innovation within the accelerator such as having demo days in order to gain feedback from a wide audience. CyRise has a unique challenge in terms of being specifically focused on cybersecurity and this necessitates a degree of secrecy in the development of some of the products in order to maintain a strong defence against potential hackers and cyberterrorism. This is where the unique partnership with the founding organisations is particularly useful. Dimension Data offers start-ups access to domain experts in the area of cybersecurity as well as more generally in the area of technology and infrastructure. A strong indication of the commitment of the organisation to the success of the accelerator is demonstrated by the involvement of senior leadership in mentoring start-ups, including the chief technology officer and the national security architect of Dimension Data. Having these individuals as part of the team of mentors opens up the communication channels within Dimension Data, facilitates the exchange of information and allows for an open innovation paradigm to be established with a trusted partner. Building on the strong foundation which has already been established between Dimension Data and CyRise, there is an opportunity for greater integration and collaboration across the two entities. In particular Dimension Data may act as a value resource in terms of building commercialisation skills in the founders such as sales and marketing skills.

5.7 Conclusion CyRise represents an innovative approach to tackling the increasing problem of cybercrime. The unique partnership model utilised in setting up CyRise and the strategic and thoughtful way in which it has been established provide insights into how collaboration acts as a catalyst for

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innovation and entrepreneurship. While it is early days for CyRise, already the indicators are that the accelerator will have a profound and positive impact on building the entrepreneurial ecosystem in the region. This outcome will have significant benefits for not only the two founding organisations and the accelerator cohort but also the broader region. Transformational entrepreneurship is often thought of as a distinctly different type of entrepreneurial activity due to its interdisciplinary nature and its foundations in challenge-based entrepreneurship (Ratten and Jones 2018). In addition it is considered to have high economic impact as well as long-term societal impact (Marmer 2012). This case study illustrates transformational entrepreneurship in the way in which interdisciplinary, cross-sector collaboration has enabled the emergence of a new entity to tackle challenging problems around cybersecurity. In creating CyRise, the partners aim to have significant social and economic impact in the Australian region in order to develop skills, create new jobs and accelerate the regional cybersecurity capacity. However, the aspirations of impact extend beyond the region as this accelerator aims in the long term to have a global presence. Thus this case study demonstrates how transformational entrepreneurship underpins the development of a new entity with significant potential. In the process of developing CyRise, the conceptual foundations of transformational entrepreneurship have been integrated into the fabric of the accelerator in the way it has been designed and set up. This facilitates the ongoing assimilation of transformational entrepreneurship into the ethos of the founders and start-ups which emerges from the accelerator and thereby aims to increase this type of high-impact entrepreneurship in the region on an ongoing basis.

References Australian Bureau of Statistics. (2015). Frameworks for Australian Social Statistics  – Information and Communication Technology. ABS Publication Number 4160.0.55.001. Retrieved from http://www.abs.gov.au/ausstats/ [email protected]/Lookup/by%20Subject/4160.0.55.001~Jun%202015~Main%20 Features~Information%20and%20communication%20technology~10018.

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Australian Cyber Security Centre. (2015). 2015 Threat Report. Retrieved from https://www.acsc.gov.au/publications/index.htm. Australian Industry Report. (2016). Chapter 2: Economic Conditions. Retrieved from https://www.industry.gov.au/Pages/default.aspx. Camillus, J. C. (2008). Strategy as a Wicked Problem. Harvard Business Review, 86(5), 98–106. Cardwell, T. (2013, July). Plugging the Cyber-Security Skills Gap. Computer Fraud & Security, 7, 5–10. Carlsson, S., & Corvello, V. (2011). Open Innovation. European Journal of Innovation Management, 14(4), 408–411. Chesbrough, H. W. (2006). Open Innovation: The New Imperative for Creating and Profiting from Technology. Boston, MA: Harvard Business Press. Cohan, P. (2017). How Cambridge and Silicon Valley Became Startup Hubs. Forbes. Retrieved from https://www.forbes.com/sites/petercohan/2017/07/18/how-cambridge-and-silicon-valley-became-startuphubs/#433bf6a237a7. de Jong, J.  P., & Freel, M. (2010). Absorptive Capacity and the Reach of Collaboration in High Technology Small Firms. Research Policy, 39(1), 47–54. Eftekhari, N., & Bogers, M. (2015). Open for Entrepreneurship: How Open Innovation Can Foster New Venture Creation. Creativity and Innovation Management, 24(4), 574–584. Feld, B. (2012). Startup Communities: Building an Entrepreneurial Ecosystem in Your City. Hoboken, NJ: Wiley. Furnell, S., Fischer, P., & Finch, A. (2017, February). Can’t Get the Staff? The Growing Need for Cyber-Security Skills. Computer Fraud & Security, 2, 5–10. Giuliani, E., Morrison, A., Pietrobelli, C., & Rabellotti, R. (2010). Who Are the Researchers That Are Collaborating with Industry? An Analysis of the Wine Sectors in Chile, South Africa and Italy. Research Policy, 39(6), 748–761. Goktepe-Hulten, D. (2009). University-Industry Technology Transfer: Who Needs TTOs? International Journal of Technology Transfer and Commercialisation, 9(1–2), 40–52. Goldfarb, B., & Henrekson, M. (2003). Bottom-Up Versus Top-Down Policies Towards the Commercialization of University Intellectual Property. Research Policy, 32(4), 639–658. Gruber, M., & Henkel, J. (2006). New Ventures Based on Open Innovation – An Empirical Analysis of Start-Up Firms in Embedded Linux. International Journal of Technology Management, 33(4), 356–372.

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Haeussler, C., & Colyvas, J.  A. (2011). Breaking the Ivory Tower: Academic Entrepreneurship in the Life Sciences in UK and Germany. Research Policy, 40(1), 41–54. Hui, K., Kim, S.  H., & Wang, Q. (2017). Cybercrime Deterrence and International Legislation: Evidence from Distributed Denial of Service Attacks. MIS Quarterly, 41(2), 497–523. Innovation and Science Australia. (2017). Australia 2030: Prosperity Through Innovation. Australian Government, Canberra. Retrieved from https://www. industry.gov.au/Innovation-and-Science-Australia/Australia-2030/Pages/ default.aspx. International Organization for Standardization. (2012). Information Technology – Security Techniques  – Guidelines for Cybersecurity. ISO/IEC Publication Number 27032:2012. Retrieved from https://www.iso.org/standard/44375. html. Kask, J., & Linton, G. (2013). Business Mating: When Start-Ups Get It Right. Journal of Small Business & Entrepreneurship, 26(5), 511–536. Kinner, C. (2015). Boosting High-Impact Entrepreneurship in Australia – A Role for Universities. Retrieved from http://www.chiefscientist.gov.au/2015/10/ media-release-building-a-culture-of-entrepreneurship/. Kitson, M., Howells, J., Braham, R., & Westlake, S. (2009). The Connected University: Driving Recovery and Growth in the UK Economy. London: National Endowment for Science, Technology and the Arts. Markman, G.  D., Phan, P.  H., Balkin, D.  B., & Gianiodis, P.  T. (2005). Entrepreneurship and University-Based Technology Transfer. Journal of Business Venturing, 20(2), 241–263. Marmer, M. (2012). Transformational Entrepreneurship: Where Technology Meets Societal Impact. Harvard Business Review. Retrieved from https://hbr. org/2012/04/transformational-entrepreneurs. Perkmann, M., Tartari, V., McKelvey, M., Autio, E., Brostrom, A., d’Este, P., et  al. (2012). Academic Engagement vs. Commercialization: A Systematic Review of Research on University Relations with Industry: Mimeo. Press, G. (2017). 6 Reasons Israel Became a Cybersecurity Powerhouse Leading the $82 Billion Industry. Forbes. Retrieved from https://www.forbes.com/ sites/gilpress/2017/07/18/6-reasons-israel-became-a-cybersecurity-powerhouse-leading-the-82-billion-industry/#588faa3420aa. Radojevich-Kelley, N., & Hoffman, D.  L. (2012). Analysis of Accelerator Companies: An Exploratory Case Study of Their Programs, Processes, and Early Results. Small Business Institute Journal, 8(2), 54–70.

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Ratten, V., & Jones, P. (2018). Transformational Entrepreneurship: An Overview. In Transformational Entrepreneurship (pp. 13–29). London: Routledge. Seet, P., Jones, J., Oppelaar, L., & de Zubielqui, G. C. (2018). Beyond ‘Know-­ What’ and ‘Know-How’ to ‘Know-Who’: Enhancing Human Capital with Social Capital in an Australian Start-Up Accelerator. Asia Pacific Business Review, 24(2), 233–260. Sieger, P., Fueglistaller, U., & Zellweger, T. (2016). Student Entrepreneurship 2016: Insights from 50 Countries. St. Gallen/Bern: KMU-HSG/ IMU.  Retrieved from http://www.guesssurvey.org/publications/publications/international-reports.html. Sutton, D. (2017, July 10). Cyber Security: A Practitioner’s Guide. Swindon, UK: BCS Learning & Development. ISBN-13: 978-1-78017-340-5. Weiblen, T., & Chesbrough, H. W. (2015). Engaging with Startups to Enhance Corporate Innovation. California Management Review, 57(2), 66–90. World Economic Forum. (2018). Cybercrime. Retrieved from https://www. weforum.org/projects/cybercrime.

6 Case Study: Transformational Entrepreneurship in Malaysia—Dare to Dream, Dare to Talk, Dare to Act(ion) Sok Kwan Say and Kii Geat Johan Lim

Abstract  This case study challenges readers to examine the role of self-­ leadership in entrepreneurship. It is based on a real-life case of how an individual self-influences himself to achieve strong self-direction and self-­ motivation in pursuing his dream. The entrepreneur started his entrepreneurial journey with a big dream and some basic knowledge of what an entrepreneur does. However, the strong self-leadership in him is the psychological trait that has driven him to continuously seek new opportunities and scale greater heights. According to Neck et al. (Journal of Small Business & Entrepreneurship, 26(5), 463–480, 2013), an individual who constantly engages in positive self-talk, self-assessment of what he can achieve and visualisation of success, and if this cycle repeats, will influence his way of thinking and self-motivate him to continuously align his cognitions with what he desires. The outcome is more than just being an entrepreneur, but an individual’s entrepreneurial journey in pursuit of an ever-expanding dream. Is this the manifestation of strong self-­leadership, an essential personality trait of a transformational entrepreneur? S. K. Say (*) • K. G. J. Lim Tunku Abdul Rahman University College, Kuala Lumpur, Malaysia e-mail: [email protected]; [email protected] © The Author(s) 2019 G. Maas, P. Jones (eds.), Transformational Entrepreneurship Practices, https://doi.org/10.1007/978-3-030-11524-1_6

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Keywords  Self-leadership • Dream • Transformation • Impact • Legacy

6.1 Introduction When one ventures into something unknown, one has to constantly remind oneself that the only option available is to move forward—Aaron Chan.

Dare to dream, Dare to talk, Dare to Act(ion)! These were the words ingrained in the mind of 18-year-old Aaron Chan, an aspiring entrepreneur when he left his home in a small coastal village in Malaysia for the capital city of Kuala Lumpur in pursuit of his dream. Jobs were scarce and business opportunities were almost non-existent in the village with more than 100 houses. That year was 1990. Today, Aaron Chan has realised his dream of becoming a successful entrepreneur. He is the founder of iRewards Bhd. (iRewards), a fast-­ growing multimillion Malaysia home-grown technology and innovation incubator. He is also the Managing Director of iRewards. The company is expanding at unprecedented speed and set to become the largest incubator in the Southeast Asia region. Plans are also in place for iRewards to become a global player in the very near future. Aaron’s humble entrepreneurial journey began in 1990 when he told his father that he wanted to leave home in search of business opportunities in Kuala Lumpur. He had just completed his secondary school education. His father gave him Malaysia Ringgit (MYR) 100 and Aaron left for the city, carried with him great determination and big dreams of starting his own business. From day one since his arrival, he began to look for opportunities to start a business that will make a difference to his life. He was confident that he is destined for something big and impactful. With limited resources and no one to turn to for help and guidance, Aaron soon settled himself for a job to support his own living, as a helper in delivering a popular brand of bottled nutritious drink by van. Life was mundane and tough but that did not deter Aaron. He worked hard and diligently. He stayed on the job for about a year, thinking about how he could expand the delivery business. However, as time passed by,

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he began to realise that there were not much prospects in this kind of business. So, he moved on, searching for opportunities that could better help him realise his dream. Harsh reality started to dawn on him. He soon realised that starting a business from scratch is extremely tough and definitely not for everyone. But still, it did not deter him from pursuing his dream. Among the challenges Aaron faced were lack of knowledge in preparing a financial roadmap for a business, a reliable and knowledgeable mentor, and availability of cost-effective funding. He wished that someone out there could lend him a helping hand. He was prepared to work hard to realise his dream. He talked and shared his dreams and thoughts with family members, relatives, friends and associates. He was confident that he has a good business model that would generate good returns, more than enough to convince prospective investors to invest in him, but who would believe him, as he had no track records. From a very young age, Aaron knew that he does not want to own and run a business for the sole purpose of providing for his loved ones and himself. He is never for subsistence entrepreneurship, which he thinks will not take him far, let alone make him happy. He has always wanted something that could help others to move together and forward with him. He has always been a strong supporter and advocate of building alliance with others in what he does, as he believes people need to leverage on each other’s strength to create synergy, especially in running a business. He is a firm believer that one cannot do everything alone, as there is a limit to what one can do and achieve, no matter how much resources are at one’s disposal. He also believes that the eventual rewards reaped from any alliance should not be his only. All stakeholders should have a share of the rewards. In a business alliance, this would include employees, business partners, business associates and customers. Whenever and wherever he sees an opportunity to talk about and share his business philosophy with others, he will do so earnestly and passionately. This business philosophy would in the later years become the hallmark of all the businesses Aaron built and expanded over the years, including iRewards. Aaron does not just dream and talk, he acts fast whenever he sees an opportunity. Prior to establishing iRewards, Aaron had ventured into running cafes, distributing a specific brand of water filters in a network

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marketing business and also designing and producing water finishing for a wide range of furniture. In all of these business ventures, he had always applied what he talked most—his business philosophy of building business alliance. His businesses had done extremely well, expanded and grown within a short time span, and he made real good money. But more importantly, his superb business acumen and people skills were put to good use as he met and made friends with many people from diverse backgrounds, some who would later become his participating merchants and business associates in iRewards. He is a strong believer in building and running his businesses based on trust, fairness, openness, transparency and good governance and, more importantly, he is a law-abiding citizen. He would not venture into businesses that have many grey areas where there is a blurring line between legality and illegality. He also believes in honouring what he said and delivering what he means. It is based on all these principles that Aaron acted and built his businesses, including iRewards. Aaron likes to share his vision and thoughts with others, as he believes bouncing of ideas helps him to better understand his dream and make better decisions. It also serves as a constant reminder to himself that he has to honour what he said and promised rather than just empty talks. He is a firm believer of “Do what you say, say what you do” principle. This is Aaron’s core value that saw him continuously delivering what he promised to the stakeholders of his businesses. His business stakeholders, especially the investors who are looking for good returns, continue to have confidence in him. Aaron never fails to deliver! Aaron is extremely passionate and motivated in pursuing his dream. His self-confidence is so strong that nothing could stop him from advancing once he has set his mind. His entrepreneurial journey had been relatively smooth sailing in the initial years, building and expanding businesses based on his business alliance philosophy. But he encountered a serious challenge at the height of his network marketing business. He had built up a successful distribution network of more than 1000 active members within a year, invested substantially in training and supporting the network, only to be informed later that the owner of the business decided not to continue with the distribution business. That was

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a blow to Aaron, as his dream of expanding the business had come to a dead end so quickly, forcing him to abandon the business. Luck was also not on his side, as he was facing some crisis in his personal life. He was really hitting the rock bottom! But, Aaron being Aaron, his fighting spirit and grit were so strong that he would not let this setback pull him down and derail him from pursuing his bigger dream. He left the capital city that had earlier given him such high hopes of attaining his dreams and travelled north to rebuild himself. Months passed by. His money was running low, and when he eventually returned to the capital city again, he had only MYR 150 in his pocket. With great determination, he persevered, picked himself up quickly and ventured into a new business, designing and producing various designs of water finishing for a wide range of furniture, which eventually saw him pulled through the difficult time. His new business in producing water finishing for furniture flourished very quickly and he made a name for the company and himself as a successful entrepreneur. His network had also expanded tremendously, as he was proactively participating and engaging with other businesses, trade associations and related government agencies. He was extremely innovative in product development, product packaging and marketing. Years later, his company went on to become the number one manufacturer of water finishing product for furniture in Malaysia. Aaron had delivered his “Dare to dream, Dare to talk, Dare to Act(ion)” motto! Aaron’s “Dare to dream, Dare to talk, Dare to Act(ion)” motto continues to propel him forward, faster, further and bigger in building and expanding his business. It is non-stoppable, advancing from one success to another success in bigger and larger scales, but more importantly creating wider and deeper impact on others. Reaching the height of his water finishing business years later might have satisfied many people but not Aaron. He yearned for more and new challenges. His thirst for something big and different continues to bug and unsettle him. He needed new challenges to satisfy the adrenalin rush in him. So, he moved on to establish iRewards in 2005. At the start of iRewards, Aaron brought together ten well-known Malaysian brands from different industries, connecting them via a reward system. Customers who purchased a certain value worth of products/

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services from one participating merchant were rewarded with vouchers issued by iRewards which allowed them to claim freebies from other participating merchants. These vouchers were designed and issued by iRewards, having agreed with the participating merchants the types of freebies each could offer. The participating merchants purchased the vouchers from iRewards for a fee and awarded the vouchers to their customers. iRewards’ main revenue stream was fees paid by the participating merchants. The value worth of these freebies was much higher than the customers’ original purchase cost, making it very attractive for customers to buy from the participating merchants. For example, a customer who purchased MYR400 worth of goods from a participating merchant might be given vouchers that allowed him/her to claim freebies in the form of gift and services amounting to MYR 10,000 from other participating merchants. iRewards does not charge customers for the services rendered. All participating merchants as well as iRewards operated separately and did not have any business interest in one another. The participating merchants who traditionally operated silos or within their industry, serving the customer base they had created and expanded, found themselves connected with other participating merchants that could complement and supplement their business. iRewards facilitates the purchase of products/ services among them at more competitive business terms, making it more attractive for the participating merchants to collaborate with one another rather than with external parties. More importantly, their customer base expanded significantly, as they had access to each other’s customers in addition to new customers brought in by iRewards. iRewards was extremely successful in their marketing strategy and business development, bringing on board more established brands from different industries and driving more consumers on board as time passed by. Over the next few years, iRewards continued to fill the gaps in the business alliance by bringing in more merchants that it believed could further add value to the existing merchants and better serve customers. Networking was vastly expanded, opening up many business opportunities, as the merchants not only traded with one another but also saw their customer base vastly expanded. Participating merchants began to reap the benefits of joining the business alliance and they too encouraged others

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to join iRewards. Soon, the number of participating merchants grew from an initial 10 to 2000, bringing in more brands and variety to consumers. Revenue for iRewards in the form of fees payable by the participating merchants had also increased in tandem with the volume of vouchers issued and sold. Aaron, the brainchild behind this reward architectural framework, attributed his success to the people who built the business with him. He said, “I always uphold a positive mindset. I motivate my team to achieve greater heights. It is my passion to create synergy and teamwork among participating businesses. I believe in long-term partnership with them on a single platform.” To better support the participating merchants and to provide more value-added services to customers, Aaron knew that he had to transform the way iRewards operates its business. He was fully aware that digitalisation is the way forward for iRewards to expand further. iRewards envisions to be the largest Big Data analytics company in the ASEAN (The Association of Southeast Asian Nations). It wants to be the ambassador of promoting green and environment-friendly Internet of Things (IoT). iRewards wants to constantly deliver better value by improving business efficiency and effectiveness, enabling participating merchants to enjoy improved life quality and balanced lifestyle within the community. A digital e-commerce platform would provide many new business opportunities for iRewards. It could leverage on Big Data technology and local knowledge about consumer behaviour and preference; cultures, customs and traditions; and the geopolitics of this heavily populated and one of the fastest growing emerging regional economies. One of Aaron’s earnest aspirations is to reach out to the aspiring and established entrepreneurs in this region, whom, he believes, collectively will create a more powerful impact on the region’s economy and in turn help to uplift the well-being of the people in the region. He also wanted iRewards to inspire and educate the small- and medium-sized businesses in this region to transform their current approaches in doing business from the conventional approach—plagued by unfair competition created by commercial juggernauts owned by ­cronies of the ruling local governments, non-availability and restrictions

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of micro financing, lacking in technical and business know-how and so on—to a digital platform that provides limitless and borderless opportunities. He strongly believes that the local small- and medium-sized businesses can be elevated to a fairer playing ground if they are equipped with the right knowledge. For that, iRewards has an important role to play and, if successful, iRewards can make a difference and impactful contribution to the economy and society in the region. Aaron also believes in providing a learning platform for the aspiring entrepreneurs and inspiring many more people, especially the youths, to be entrepreneurs. He is a strong advocate of youth empowerment. He believes that iRewards would make a greater impact on the economy and society if it could reach out to the youths who made up a large percentage of the population in the region. If they can be trained and groomed to be entrepreneurs, they will be able to take charge of their lives. More importantly, they can contribute significantly to the well-being of their loved ones. That would really make a difference to their lives. Aaron did not want the participating merchants to be just plain merchants earning a decent living. He wants them to have dreams of their own and iRewards will help them realise their dreams. To achieve this mission, Aaron believes the time is ripe for iRewards to migrate to a fully digitalised e-commerce platform. Digital technology and e-commerce had already set foot in Malaysia for years and there were increasing intense competitions coming from all angles, from the well-established global and regional e-commerce giants that were relentlessly penetrating the Malaysia market and also markets in the ASEAN, reaching out to local merchants and customers, to the newbies that were entering the markets in an unprecedented speed and agility, promoting niche services. Aaron and team began to ponder in search of gaps in this increasingly crowded and borderless market in which iRewards could create a competitive edge, earn good returns and, in turn, increase the value of iRewards to the stakeholders. By then, Aaron had built a team of experts in various disciplines who were ready to venture with him into the new frontier, a new business model leveraging on business alliance, latest digital technology and e-commerce. He had also restructured iRewards to support all these impending changes. Aaron and team were fully aware that the timing of

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entry into the digital market was critical and they had to get it right from the beginning, as there was no turning back. In his own words, Aaron said “when one ventures into something unknown, one has to constantly remind oneself that the only option available is to move forward.” He believes that if one keeps thinking that there are other options available, that would greatly reduce his/her chance of success. Under the leadership of Aaron, iRewards eventually transformed from a loosely connected business alliance supported by a reward-based system to a well-­ connected business alliance operating on an integrated digital e-commerce platform in 2014. The transformation was a mammoth task, as it not only involved the migration of the participating merchants into a fully digitalised e-­commerce platform but also meant that iRewards now operates very differently in all aspects of its business. Existing staff needed to upskill themselves to better handle the transformation and the participating merchants needed to be trained as well and to be convinced as to what is in store for them and their future prospects. The plus point then was that iRewards had built a large base of about 2000 participating merchants, which was a readily available source of participants for the digital e-commerce platform. Compared to the reward-based system, the digital e-commerce platform was a totally new ball game for the participating merchants and also iRewards. The platform is powered by an Enterprise Resource Planning (ERP) system that provides customisable mobile shopping sites and social media marketing, where consumers could access, evaluate, review and purchase goods/services from a wide range of participating merchants at competitive prices and terms. The platform also enables iRewards to provide Big Data analytics services to participating merchants, helping them to boost their efficiency in running their business and, more importantly, uncover untapped opportunities that could add value to their business. The platform was designed and developed in house and has undergone many rounds of enhancement to be able to better manage the increasing volume and velocity of data passing through its system and the applications of business analytics for business intelligence purposes. Through this platform, iRewards could provide a myriad of technical and business

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expertise services to the participating merchants that the latter could not do so on their own, as they might not possess the required expertise and also it would not be cost-effective for them to do so anyway. This has attracted many merchants, both existing to migrate and new merchants, to come on board the digital e-commerce platform, creating an even bigger marketplace digitally, with more choices of goods and services offered at attractive business terms to provide shoppers better shopping experiences. Like the business-voucher-based reward system, iRewards does not charge the participating merchants and customers any fee for the use of the digital e-commerce platform. However, participating merchants pay iRewards a percentage of their turnover. The rapid increase in the sales of the participating merchants and hence the turnover also saw the revenue of iRewards soaring to unprecedented heights. By 2016, the number of participating merchants had risen fivefold, from 2000 to 10,000. But Aaron knew that he could do much more with his business alliance philosophy. iRewards has expanded its outreach, transcending geographical boundaries through its fully digitalised e-commerce platform. It is leveraging on Big Data technology and local knowledge to give itself the competitive edge over other similar operators of e-commerce platform from overseas. It is well set and placed in an expansion mode, but Aaron yearned for a more solid and meaningful business alliance where iRewards could expand even more rapidly into a wide range of industries with good potentials and, in return, increase the value of its investments and itself. In 2016, Aaron restructured iRewards and registered it as a public company, laying the foundation for the planned initial public offering (IPO) with NASDAQ in 2021. The restructured iRewards comprises four key infrastructures, namely, financial, commercial, trading and media. This restructuring also transformed iRewards into a technology and innovation incubator. iRewards started to embark on an investment mode, the capital mechanism where it invested in new companies that have great potentials under each of the four infrastructures through special purpose vehicles (SPVs) created to serve the intended purposes. The expansion led to iRewards owning numerous subsidiaries and associate companies. The digital e-commerce platform which it set up in 2014 now operates as a subsidiary of iRewards.

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iRewards has evolved into an investment holding company, focusing on nurturing and growing its suite of companies which it has invested in. It continues on the lookout for investment potentials in other companies. The restructuring has also seen iRewards expanding its pool of talents both locally and abroad to better support its expanded range of services, which includes pitching for funds, upscaling/accelerating business and preparing business for IPO locally and/or abroad. iRewards also established alliances overseas. The creation and expansion of the SPVs help iRewards to expand rapidly into other industries and increase the company’s worth. But more importantly, the huge and rapid increase in data captured in its integrated computing system in terms of volume, variety and velocity provides ample opportunities for robust analytics. In this increasingly digitalised world, Big Data is the key to a company’s success and value, as iRewards could leverage on the many data science tools to analyse the data for a wide range of value-added services. This rapid transformation which enables iRewards to provide both commercial and financial infrastructure saw the company’s worth soaring to an unprecedented height, as investors are more confident and excited of the business model and iRewards’ potentials. More investors, locally and abroad, including those with very deep pockets, began to invest in iRewards. iRewards has built a name synonymous to the business of creating and increasing the value of its suite of companies and itself. iRewards is inching closer and closer to Aaron’s ever-expanding dreams supported by his talks and cemented by his actions based on his motto, “Dare to dream, Dare to talk, Dare to Act(ion).” To further enhance the provision of its suite of services, iRewards constructed a one-stop physical platform to bring together members of its incubation ecosystem for common activities. It launched its very own Techno Campus in 2018. This modern, spacious and wellequipped campus operates as an incubation centre and is located in a sprawling shopping complex in the city centre of Kuala Lumpur. It is tastefully decorated and provides an exuberant ambience where members of the ecosystem gather to share, brainstorm and implement their business ideas. This is where aspiring entrepreneurs incubate their business and learn the ropes of running and managing it. The centre is complete

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with investors; funders; business support services such as accounting, legal, taxation, merger and acquisition and IPO; mentors; trainers, technical and non-technical; and business tools, especially latest digital tools, to cater to its current and future needs. iRewards arranges inspiring sharing sessions by successful entrepreneurs and important discussions with potential collaborators and investors. Behind the scenes, iRewards’ founder, co-founders and staff continue to work tirelessly planning, managing and driving the company to next greater heights in their offices, which are located inside the campus itself. Aaron believes iRewards will continue to soar to greater heights. He has plans to turn iRewards into the largest incubator in this region in the very near future. He is confident that his highly motivated team members, which comprise experts from different disciplines, are well placed locally and abroad to take whatever challenges that come along as they assist him in moving seamlessly into the future. Aaron is a strong believer in cultivating and retaining talents. iRewards has a highly competitive remuneration package and staff training and development programmes that appeal to Gen Y and the millennials. The company collaborates with institutions of higher learning and youth organisations to recruit young talents who aspire to be part of its dynamic and vibrant team. iRewards believes employees are its greatest asset and reward them generously. According to Aaron, iRewards will only thrive if its employees are aligned to the company’s goals and vision. He is all for meritocracy when asked who would eventually succeed him as the Managing Director of iRewards. He believes in leaving behind his legacy to the person most capable of adding more value to iRewards in years to come. His successor would have some big shoes to fill, taking over the reins from Aaron when the day comes! Aaron has again proven that his business alliance philosophy is the way forward in building and expanding a business. Irrespective of the industry his business operates in, he stayed true and firm to his philosophy of forming alliance with others. He has shown that it worked in running cafes, in the network marketing business, in the manufacturing sector and now in running, managing and expanding iRewards. He has also demonstrated that the alliances formed are not cast in stone but agile to adapt to the changing needs as the business evolves. This is critical especially for

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iRewards, as it undergoes one transformation after another in such a short time span. But building a successful alliance is not an easy feat. It takes a charismatic and visionary leader like Aaron to bring together the best of all related parties, continuously motivating and aligning them into a common direction and goal, commanding their confidence and trust as the alliance is built and strengthened. This helps the alliance to move seamlessly into the future, achieving its objectives and common goals. The alliance must also be well supported along the way by well-designed but agile infrastructure, both hard and soft, to adapt to changing business operations and environment. All these fundamentals need to be built, strengthened and enhanced if a large business alliance such as iRewards is to continue its quest to scale greater heights and to explore and chart new horizons to build its mark locally, regionally and globally. Aaron is fully aware of these as he navigates iRewards towards a better future, further expanding the value of the company until he hands over the reins to his successor one day. Meanwhile, Aaron continues to build his legacy through iRewards. He is a strong believer in giving back to society. He believes that whatever deeds one has done in the past, they will eventually find their own way back to the doer/giver. This is how he lives his life and iRewards is the manifestation of his beliefs and values. Aaron has utmost confidence that iRewards will continue to impact favourably more and more people as it expands to ASEAN and other parts of the world. iRewards is also confident of continually earning good returns for its investors. With the strong commercial and financial infrastructure in place, iRewards is poised to expand rapidly into many other industries through business alliance. It currently has shareholding in 20 companies, ranging from e-commerce, e-payment, entertainment and hotels to aquaculture. It is always scouting for more companies with great potentials to join its stable of investments. In a nutshell, iRewards is being aligned and integrated into a solid purpose to develop the best platform for shareholders, business partners, consumers and employees to create wealth together. These ingredients are essential to iRewards to allow the company to be agile, flexible and responsive to change and adapt to the dynamic business environment.

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Aaron takes pride that he has finally realised his dream of building the real business alliance. In his own words, he said owning equity, working on nurturing, growing and expanding this fast-growing suite of companies in a diverse range of industries and geographical locations, and taking them to greater heights is the epitome of a successful business alliance. Still, he yearns for more. Aaron has even greater plans for iRewards ahead. He aims to expand iRewards’ suite of companies to 30 by the end of 2018 and is working towards achieving 150 companies across the different sectors and different continents within the next five years. Aaron is confident that iRewards will one day transform into a regional and also global integrated technology and innovation incubator, as it is always positioning itself at the forefront in whatever it ventures into. This is his dream for iRewards, and he will lead and guide iRewards towards achieving this goal during his tenure as the Managing Director. In the midst of turning his dream into reality, there are also some personal aspirations that he holds close to his heart. One of these is inspiring and building more entrepreneurs who can create jobs for themselves and others. His fervent wish is to inspire and guide these young aspiring entrepreneurs to realise their dream, like what he started almost three decades ago. He aspires to provide them an easier pathway to pursue and attain their dream. He believes iRewards’ techno campus can do this role. He aspires to help aspiring entrepreneurs allay their fear of venturing into starting their own business, equip them with the knowledge and, most importantly, continue inspiring them to pursue their dream of becoming successful entrepreneurs in their own right. He believes young people should be educated, inspired and guided from early on to have their own dreams and be steadfast in pursuing them to make this world a better living place for themselves and everyone. Aaron has had a tough and long winding entrepreneurial journey to be what he is today, and he thinks he is in a good position to lend a helping hand to make a difference in the lives of others. For that, he is prepared to collaborate with all relevant parties to go the extra mile of pursuing and realising this personal aspiration of his.

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6.2 Aaron as Transformational Entrepreneur Aaron’s pursuit of an ever-expanding dream has seen the transformation of iRewards from a typical e-commerce company into a regional technology and innovation incubator in a short time span of five years. The speed and scale of the transformation is probably the first of its kind in Malaysia and one of the few in ASEAN. iRewards’ rapid expansion in outreach to businesses and consumers in this region is unprecedented. The ecosystem is expanding fast, attracting established institutional investors in ASEAN and beyond, including some foreign country leaders. A juggernaut incubator is in the making and will soon earn its reputation as the largest technology and innovation incubator in the region and probably beyond ASEAN in the next 5–10 years.

6.3 Conclusion Aaron’s advice to aspiring entrepreneurs is best summed up as follows: Funding is not the key ingredient in a business and should not be used as a lame excuse for not being able to pursue one’s dream of becoming an entrepreneur. One must always remember that the core of a business is the entrepreneur himself or herself. People invest in the entrepreneur, not in his business. This is a very crucial element, as when the business grows, it requires a strong and determined personality rather than just a good business model. As such, if one aspires to be a successful entrepreneur, one must be prepared to face whatever challenges that come along and have the perseverance and determination to overcome them. A good mentor and a realistic financial roadmap are invaluable assets to the entrepreneur. These are the must-haves to build a successful business. Meanwhile, Aaron’s “Dare to dream, Dare to talk, Dare to Act(ion)” motto will continue to live on and will be his greatest legacy for iRewards as the company embarks into the future. iRewards will continue to impact many others along its journey, favourably and deeply, changing their lives and their loved ones’ and of people surrounding them.

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References Anon. (2018a, January). iRewards Weekly Newsletter. Retrieved from https:// www.irewards.my/newsletter/january-week-1/. Anon. (2018b, June). beeZmall. Retrieved from https://www.beezmall.com/irewards. Anon. (2018c, July). iRewards Berhad. Retrieved from https://www.irewards.my/. Chan, A. (2018, August). Personal Interview. Neck, C. P., Houghton, J. D., Sardeshmukh, S. R., Goldsby, M., & Godwin, J.  L. (2013). Self-Leadership: A Cognitive Resource for Entrepreneurs. Journal of Small Business & Entrepreneurship, 26(5), 463–480. https://doi.org/ 10.1080/08276331.2013.876762.

7 Conclusions on Transformational Entrepreneurship Paul Jones and Gideon Maas

Abstract  This book offers further insightful evidence regarding the emergent phenomenon that is transformational entrepreneurship. Transformational entrepreneurship is a relatively nascent concept that has emerged due to the need to achieve effective and efficient entrepreneurial behaviours that address global challenges, including unemployment, economic underperformance and societal evolution. Entrepreneurial activity continues to evolve due to technological enhancement, societal evolution and globalisation. Moreover, the nature of entrepreneurial behaviour continues to evolve with social enterprise becoming globally important to sustain and support communities and the requirement for environmentally and economically sustainable business behaviour. This chapter evaluates and concludes on the evidence presented in this P. Jones (*) Swansea University, Swansea, UK e-mail: [email protected] G. Maas Coventry University, Coventry, UK e-mail: [email protected] © The Author(s) 2019 G. Maas, P. Jones (eds.), Transformational Entrepreneurship Practices, https://doi.org/10.1007/978-3-030-11524-1_7

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t­extbook and offers conclusions on the opportunities and further challenges ahead. Keywords  Transformational entrepreneurship • Entrepreneurship

7.1 Introduction This book offers further evidence regarding the emergent phenomenon of transformational entrepreneurship. In Chap. 1, we presented the working definition of this concept as: Transformational entrepreneurship is to promote enterprise and entrepreneurship through a systemic approach, bringing about transformation in socio-­ economic development.

Transformational entrepreneurship is considered an alternate type of entrepreneurial activity because of its interdisciplinary nature and its focus on challenge-based entrepreneurship (Ratten and Jones 2018). The term transformational entrepreneurship has gained popularity within the academic community (Ratten and Jones 2018) to describe major changes in society influenced by entrepreneurial activity to enable enhanced ­competitiveness and market performance (Moscardo 2014). Marmer (2012) suggests that transformational entrepreneurship offers significant economic impact and long-term societal impact. Anggadwita et al. (2017) adds that transformational entrepreneurship is important and that a socially significant form of entrepreneurship will transcend cultural barriers. The following section will consider the implications of this text for transformational entrepreneurship.

7.2 Findings The limited research in this field tells us that for transformational entrepreneurial to provide a lasting legacy and positive economic impact, it must adopt a systematic approach, be socially productive and go beyond

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the local level to provide benefits for wider society (Sautet 2013). Marmer (2012) suggests that transformational entrepreneurship requires a combination of technology and social entrepreneurship to drive socio-economic growth. Turner (2018) and Rugeruza (2017) identify that the traits commonly associated with transformational entrepreneurship are possessing a futuristic and disruptive dream, and building a strong team, whilst Roth and DiBella (2015) suggest that the five competencies required to enable transformational change are enterprise awareness (e.g. industry knowledge), innovation, balancing management and employee interrelationships of organisation change, and seeking growth and leadership. Transformational entrepreneurship remains a nascent concept that has emerged due to the need to implement effective and efficient entrepreneurial behaviours that address ongoing global challenges, including unemployment, economic underperformance and societal evolution (Maas and Jones 2015). Entrepreneurial activity and behaviours continue to evolve due to technological enhancement, societal evolution and globalisation (Vahlne and Johanson 2017). However, the academic literature has long recognised that country-level economies include both effective (e.g. innovation focused and growth orientated) and ineffective entrepreneurial behaviour (e.g. necessity/subsistence focused) (Bruton et  al. 2015). Identifying strategies to enable positive change on such countries can require significant investment and experimentation to identify practices that can transfer to a specific local context. Schoar (2010) notes the importance of effectively identifying transformational entrepreneurs who create growth-orientated businesses that provides both employment and income. Ratten and Jones (2018) suggest that transformational entrepreneurship offers a way of integrating sustainability practices whilst focusing on sustainable future trends. They suggest transformational entrepreneurship uses novel business practices to reduce inequality in the marketplace and can transform society through creative solutions that enable change. Moreover, the nature of entrepreneurial behaviour continues to evolve with social enterprise becoming globally important to sustain and support communities and the requirement for environmentally and economically sustainable business behaviour. In recent years, there has been a global drive within individual countries to enable entrepreneurial activity through encouraging business

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start-ups (Kolvereid 2016). Thus, there has been a significant growth in the provision of entrepreneurship education and the development of ­ecosystems to support business start-ups and growth in specific industrial sectors (Stam 2015; Spigel 2017). This has included the provision of entrepreneurship education across the educational curriculum, including within further and higher education curriculums (Jones et al. 2015). At higher education level, this has included focus on graduate start-ups, venture creation degrees, cross-disciplinary curriculum provision of entrepreneurial curriculum, pre-incubators and seed corn funding (Jones et al. 2017). However, further and ongoing evidence is required to evaluate the effectiveness of entrepreneurship education practice (Maas and Jones 2017). In addition, within the UK and Europe, educational policy has developed through QAA guidelines and EntreComp sufficiently to discern the differences between enterprising behaviour and entrepreneurial activity (business start-up) in terms of policy guidelines for curriculum development and best practice (QAA 2018; Bacigalupo et al. 2016). Thus effective entrepreneurship education provision should produce future transformational entrepreneurs with the required knowledge and skills to create economically viable and environmentally sustainable businesses to benefit their communities. In terms of the evidence presented in this book, what conclusions can we draw regarding the evolution of the concept of transformational entrepreneurship? The chapter by Xu and Maas discerns the key differences and similarities between entrepreneurial and innovation-driven ecosystems. The chapter notes the importance of discerning that differences exist in the construction of these ecosystem models (driven by ­different academic communities) and identifies best practice. That chapter concludes that key stakeholders such as government must appreciate that it takes time to build a successful and self-sustainable ecosystem. Thus, government stakeholders should acquire a long-term vision, work collectively and service the requirements of their communities. The chapter by Connolly considers the perspective of social enterprise and transformational entrepreneurship, suggesting that social entrepreneurship offers a promising model for achieving socio-economic growth given the inequality in society (Dees 1998). This study answers the call of Marmer (2012) for further research in this context. Connolly recognises

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that the complex challenges within a social enterprise include the need to balance both economic and social goals whilst competing with commercial enterprises. Moreover, the need to retain focus on the mission of the social enterprise whilst achieving economic sustainability offers the opportunity to embrace transformational concepts. Thus, business expansion should be coupled with the ongoing mission of effectively serving a particular community. However, Connolly notes that the eradication of the societal problem might result in the long-term closure of the business. Thus, transformational social entrepreneurs must not only accept but also advocate the diminishing requirement for their services. The chapter suggests this is achieved through adopting a systemic approach: moving away from the individual or the business, and towards the integration of the entire system. The case study presented highlights the importance of ethically and contextually considered partnerships, crowdfunding campaigns and encouraging competition. The chapter by Arthur explored how female micro entrepreneurs can transition into transformational entrepreneurs using a case-study approach. Arthur noted that the female entrepreneurs evaluated possessed risk-taking characteristics, managerial competencies and financial literacy, as previously suggested by de Mel et al. (2005) on transformational entrepreneurs. In addition, the respondents were also willing to operate in unfamiliar situations, a characteristic proposed by Schoar (2010) as possessed by transformational entrepreneurs. The chapter by Round shows how the principles of transformational entrepreneurship are being utilised within a collaborative accelerator to tackle the emergent issue of cybercrime. The accelerator demonstrates how this collaboration acts as a catalyst for developing an effective regional innovation and entrepreneurship ecosystem by developing skills, creating employment and enhancing the cybersecurity capabilities for the region in question. The chapter by Kwan and Geat considers the factors underpinning the success of Kwan as a successful entrepreneur. Kwan notes the importance of ethical behaviour within the business and all its functions. Kwan highlights the importance of the vision of the entrepreneur whereby the entrepreneur must be determined to succeed regard­less of the challenge and demonstrate perseverance and determina­ tion throughout. The authors also note the importance of financial

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­ anagement and mentoring to encourage success. In conclusion this m chapter provides a personal insight into effective transformational behaviour exhibited by an entrepreneur to demonstrate a transformational impact on their community.

7.3 Conclusions The academic community must avoid reinventing and relabelling existing behaviours in an attempt to create novel contributions for personal gain. Transformational entrepreneurship has developed due to the recognition that entrepreneurial behaviour is an emergent and evolving phenomenon due to societal, economic and situational change (Marmer 2012; Sautet 2013). Thus, it does represent a valid approach to offer novel and best practice approaches to create more efficient and sustainable entrepreneurial behaviours. This book offers further evidence regarding the emerging concept of transformational entrepreneurship. The chapters reflect the evolving nature of entrepreneurial behaviour, in that they are drawn from several global perspectives, including Europe, Africa and Asia, and differing aspects of entrepreneurial activity, including female entrepreneurship, social enterprise and specific industrial sector activity, and enterprise sizes. Several chapters discuss the importance of effective ecosystems ­supporting transformational entrepreneurial activity. The emergence of effective ecosystems is key to enabling major societal and economic transformational change within a region. A salient example would be the emergence of the major information technology cluster in the Bangalore region of India due to the significant and systematic investment in business infrastructure, incubation facilities and educational provision (Van Dijk 2003; Sonderegger and Täube 2010). This has transformed the entrepreneurial activity within this region to a knowledge-based regional economy focused on innovation, with significant societal impacts on economic growth, employment and wealth creation. The chapters by Xu and Maas and Round make several suggestions regarding effective ecosystem development, including the need for a long-term regional vision, a collective and collaborative mind-set between

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g­ overnment decision makers and businesses, and the time taken to realise this vision. Similarly, the chapter by Connolly recommends developing a systematic approach to develop scalable transformational social enterprises that contribute significantly to their communities. Several of the chapters (Arthur; Kwan and Geat) discuss the importance of the transformational entrepreneur and the characteristics they require. These include both business skills and knowledge such as managerial competencies, financial numeracy, ethical beliefs and strategic vision. In addition, entrepreneurial characteristics such as risk taking, the ability to cope with changing and unfamiliar circumstances, and demonstrating perseverance and determination were judged as important (Schoar 2010). This suggests the importance of effective entrepreneurial behaviour to achieve transformational entrepreneurship. Thus, it is key that regions seek to develop entrepreneurial individuals who have the requisite knowledge, skills and characteristics to grow a transformational enterprise. Such a process might relate to the provision of focused entrepreneurial education directed at the development of entrepreneurial activity in certain industrial sectors. So in conclusion, this book adds further evidence to the literature on transformational entrepreneurship, supplementing Ratten and Jones’ (2018) recent publication. Further research is required in the transformational entrepreneurship domain to explore transformational entrepreneurship in specific contexts like social enterprise, female entrepreneurship and technological entrepreneurship. In addition, further research needs to be undertaken exploring ecosystem development through a transformational entrepreneurship perspective. The contextual differences in transformational entrepreneurship between the developed and the developing world also need to be undertaken. There is also the need for longitudinal case studies to highlight best practice for enabling transformational entrepreneurship (Ratten and Jones 2018).

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References Anggadwita, G., Luturlean, B. S., Ramadani, V., & Ratten, V. (2017). Socio-­ Cultural Environments and Emerging Economy Entrepreneurship: Women Entrepreneurs in Indonesia. Journal of Entrepreneurship in Emerging Economies, 9(1), 85–96. Bacigalupo, M., Punie, P., & Van den Brande, Y. (2016). EntreComp: The Entrepreneurship Competence Framework. EUR 27939 EN.  Luxembourg: Publication Office of the European Union. Bruton, G. D., Ahlstrom, D., & Si, S. (2015). Entrepreneurship, Poverty, and Asia: Moving Beyond Subsistence Entrepreneurship. Asia Pacific Journal of Management, 32(1), 1–22. Dees, J. G. (1998). The Meaning of Social Entrepreneurship. [Online]. Retrieved August 1, 2016, from http://www.redalmarza.cl/ing/pdf/TheMeaningofsocial Entrepreneurship.pdf. de Mel, S., McKenzie, D., & Woodruff, C. (2005). Returns to Capital in Microenterprises: Evidence from a Field Experiment. Quarterly Journal of Economics, 123(4), 1329–1372. Jones, P., Forbes-Simpson, K., Maas, G., & Newbery, R. (2015). Beta: An Experiment in Funded Undergraduate Start-Up. Industry and Higher Education, 29(5), 405–418. Jones, P., Maas, G., & Pittaway, L. (2017). Entrepreneurship Education: New Perspectives on Entrepreneurship Education. Contemporary Issues in Entrepreneurship Research, Volume 7. Bingley: Emerald Ltd. Kolvereid, L. (2016). Preference for Self-Employment Prediction of New Business Start-Up Intentions and Efforts. International Journal of Entrepreneurship and Innovation, 17(2), 100–109. Maas, G., & Jones, P. (2015). Systemic Entrepreneurship: Contemporary Issues and Case Studies. London: Palgrave Publishing. Maas, G., & Jones, P. (2017). Entrepreneurship Centres: Global Perspectives on Their Contributions to Higher Education Institutions. London: Palgrave Macmillan. Marmer, M. (2012). Transformational Entrepreneurship: Where Technology Meets Societal Impact. Harvard Business Review. Retrieved November 10, 2018, from https://hbr.org/2012/04/transformational-entrepreneurs. Moscardo, G. (2014). Tourism and Community Leadership in Rural Regions: Linking Mobility, Entrepreneurship, Tourism Development and Community Well-Being. Tourism Planning & Development, 11(3), 354–370.

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QAA. (2018, January). Enterprise and Entrepreneurship Education: Guidance for UK Higher Education Providers. Roth, G. L., & DiBella, A. J. (2015). Systemic Change Management – The Five Capabilities for Improving Enterprises. New York: Palgrave Macmillan. Ratten, V., & Jones, P. (2018). Transformational Entrepreneurship. Routledge Frontiers of Business Management. London: Routledge. Rugeruza, A. (2017). 4 Distinct Traits of Transformational Entrepreneurs. Retrieved November 22, 2018, from http://iroikos.co.uk/4-distinct-traitstransformational-entrepreneurs/. Sautet, F. (2013). Local and Systemic Entrepreneurship: Solving the Puzzle of Entrepreneurship and Economic Development. Entrepreneurship Theory and Practice, 37(2), 387–402. Schoar, A. (2010). The Divide Between Subsistence and Transformational Entrepreneurship. National Bureau of Economic Research, 57–81. Retrieved November 22, 2018, from http://www.nber.org/chapters/c11765. Sonderegger, P., & Täube, F. (2010). Cluster Life Cycle and Diaspora Effects: Evidence from the Indian IT Cluster in Bangalore. Journal of International Management, 16(4), 383–397. Spigel, B. (2017). The Relational Organization of Entrepreneurial Ecosystems. Entrepreneurship Theory and Practice, 41(1), 49–72. Stam, E. (2015). Entrepreneurial Ecosystems and Regional Policy: A Sympathetic Critique. European Planning Studies, 23(9), 1759–1769. Turner, S. (2018). 5 Traits of Transformational Entrepreneurs. Retrieved November 10, 2018, from http://www.cose.org. Vahlne, J. E., & Johanson, J. (2017). From Internationalization to Evolution: The Uppsala Model at 40 Years. Journal of International Business Studies, 48(9), 1087–1102. Van Dijk, M. P. (2003). Government Policies with Respect to an Information Technology Cluster in Bangalore, India. European Journal of Development Research, 15(2), 93–108.

Index1

A

Accelerator, 74–80, 82–84, 109 Accra, 57, 58 Ács, Z. J., 5 Africa, v, vi, 55–67, 110 Amalena Children’s Haven, 57–59 Australia, vi, 56, 69–84 B

Bimbeads Concept Designs, 59–60 Bimbo Balogun, 59, 60 Brazil, 36, 37, 40 Brewery, 40 Brexit, 38, 39 C

Cadbury, William, 38

Cassava processing, 60–61 Sakyi, Faustina, 60, 60n3 Chan, Aaron, 90 Chinese, 25 Complex system, 6 Madelin and Ringrose definition, 6 Crowdfunding, 12, 43, 44, 49, 109 Cybersecurity accelerator, 70, 72, 74, 75 CyRise, 69–84 D

Deakin University, 74, 75, 82 Dimension Data, 74, 75, 83 Dreamland Piggery, 61–62

 Note: Page numbers followed by ‘n’ refer to notes.

1

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116 Index E

Ecosystem collectively, 28, 75 entrepreneurial Isenberg, D., 19, 24 innovation Bernus, P., 16, 22 Rabelo, R., 16, 22 England, 37 Entrepreneurship, v, vi, 1–13, 16, 17, 19, 20, 22, 24–28, 33–49, 56, 57, 61, 63, 66, 67, 69–84, 89–103, 105–111 Entrepreneurship education, 7, 8, 11, 67, 73, 108 Environment, 2–4, 7–10, 12, 17, 20, 25–28, 34, 36, 41, 46, 58, 63, 70, 73, 77, 81, 82, 101 European Union (EU), 38, 39 F

Female micro entrepreneurs, 109 Food waste, 35–37, 46–48 Franchising franchisee, 42 franchisor, 42 Funding, 17, 20, 21, 27, 43, 62, 65, 75, 82, 91, 103, 108 G

Gates, Bill, 38 Gender, 55–67 Ghana Accra, 57 Kumasi, 57

Globalisation, 107 Government, 7, 20–22, 24–28, 34, 39, 67, 70–72, 75, 93, 95, 108, 111 Gross domestic product (GDP), 37, 38, 67, 71, 75 H

Heuristic, 2, 4, 7, 9, 46 Higher education (HE), v, 72, 74, 108 Holistic, 2, 4–7, 46 I

Iceland, 36, 37, 40, 41 Information and communication technologies (ICT), 67 Innovation first- and second-order innovation, 10, 11, 16, 25, 27 Knickel, K., 10, 16 International Centre for Transformational Entrepreneurship (ICTE), 11, 12 Internationalisation/ Internationalization, 27, 66 iRewards, 90–103 Israel, 79 J

Japan, 18 Johnson, Luke, 38 Jones, P., 2, 43, 107, 108

 Index 

117

K

R

Kenya, 63, 64

Rowntree, Joseph, 38

L

S

LaunchVic, 75

Owen, Robert, 38 Oxfam, 34

Scotland, 37 Silicon Valley, 18, 20 Social enterprise, vi, 35, 36, 39, 41, 44, 46, 48, 49, 107–111 Social entrepreneurship, 7, 35, 37–39, 48, 49, 107, 108 Societal evolution, 107 Socio-economic development/ growth, v, 2–7, 9–12, 19, 49, 56, 106–108 Start-ups, 20, 21, 25–27, 41, 56, 59, 60, 62, 63, 65, 72–84, 108 Stuart, Tristram, 36, 37 Sustainability, 22, 40, 42, 48, 107, 109 Systemic change, 7, 44 DiBella, A. J., 7 Roth, G. L., 7 Systemic entrepreneurship, v, 4, 6, 46

P

T

Pauline Cosmetics, 63–64 Tuikong, Nelly, 63 Private sector, 5, 44 Public sector, 5, 26, 27, 39

Taiwan, 20 Technological enhancement, 107 Tesco, 47, 48 Third Sector, 39 Toast Ale craft beer, 36, 37, 45 Wold Top Brewery, 37, 40 Transformational entrepreneurship Collier, E. W., 6 Marmer, M., 6, 11, 49, 84, 106–108, 110

M

Maas, G., 2, 43, 107 Management, 8, 18, 27, 58, 59, 107, 110 Micro and small enterprise (MSE), 56, 57 Milestones, 27, 28 N

Non-governmental organisations, 34 Northern Ireland, 37 O

Q

Quality Assurance Agency (QAA) (2018) definitions enterprise (definition), 3 entrepreneurship (definition), 3

118 Index

Transformational entrepreneurship (cont.) Miller, R. A., 6 Sautet, F., 2, 4, 6, 107, 110 Schoar, A., 3, 57, 107, 109, 111 transformational enterprises, 111

Universities, v, 7, 11, 22–24, 26, 58, 65, 69–84 W

Wales, 37 Women entrepreneurs, 56, 57, 59, 64

U

Unemployment, 5, 34, 107 United Kingdom (UK), v, 34–49, 56 United States (US), 36, 37, 40, 41, 79

Y

Yorkshire, 37, 40 Young, Michael, 38