A New Focus on Nonprofit ­Entrepreneurship Research

Abstract

One distinctive contribution nonprofit entrepreneurship research brings to the broader domain of nonprofit studies is an explicit focus on the process of new nonprofit organizational emergence. This article asserts that in order for nonprofit entrepreneurship scholarship to continue to evolve, it is necessary to focus more on what happens before a new nonprofit is formally founded, during the so‐called nascent phase. Using conceptual as well as empirically derived arguments, this article illuminates why nascent nonprofit research is necessary and valuable to nonprofit entrepreneurship scholarship and highlights promising areas for future research.

What Constitutes a New Nonprofit? Investigating Nonprofit Organizational Founding Dates

“…Many of the organizations operated for at least a year, on average, before becoming incorporated, and an additional year, on average, between incorporation and filing for tax-exempt status. This finding reinforces the notion that nonprofit entrepreneurship is a process that transpires over time (Andersson, 2017), and that many nonprofit organizations are operational long before they formally become incorporated and/or tax-exempt entities (Lecy et al, 2016). Also, as noted earlier, scholars such as Cordes et al (2004) argue that the IRS ruling date is a reasonable facsimile for the formation of a new nonprofit.…”

“…The process of founding can also be observed in the nonprofit life-cycle literature, which recognizes that many undertakings in the gestation of a new nonprofit organization transpire before the new entity becomes a formal operational entity (Bess, 1998;Edenfield & Andersson, 2018), what Fredrik O. Andersson (2017) refers to as the nascent nonprofit stage. Hence, the notion of founding is less distinct from a life-cycle perspective.…”

“…A fundamental challenge facing any nonprofit researcher wanting to detect and isolate new nonprofits is that founding cannot be depicted as a discrete event but rather as a process transpiring over time (Andersson, 2017). In other words, the question of when a new nonprofit is founded is intimately connected to the choice and determination made by the questioner of what constitutes founding.…”

Examining the influence of organizational characteristics on nonprofit commercialization

“…Accordingly, the origins—the context into which an organization emerges (Pache & Santos, )—constitute an important building block for the organizational identity as it influences the organizational goals and core‐values. Andersson (, p. 251) refers to this process as “early imprinting”, namely “ founding activities and conditions become engraved onto a new organization and persist over time .” Following this logic, we assume that the “starting position” of NPOs influences the composition of its revenue mix. Turning to commercialization, NPOs originating out of “for‐profit” networks may be more susceptible to commercialization compared to NPOs that emerged out of market‐critical networks.…”

Growing Pains: The Transformative Journey from a Nascent to a Formal Not-For-Profit Venture

“…New nonprofits do not simply materialize out of thin air fully functional and ready to offer new services and programs, which means many undertakings in the gestation of a new nonprofit organization transpire before the new entity becomes a formal operational entity (Andersson 2017). In other words, new organizations begin in a pre-venture or nascent stage before entering a formal start-up stage.…”