FREE UNC course note | Policy Entrepreneurship

When I first thought about being an entrepreneur, I thought of tech start-ups and big revenues. But as I learned more, I realized that there are so many kinds of entrepreneurship—social, economic, policy-based, and more. Each of them brings something new to our communities, whether it’s solving social issues or driving innovation. In this post, I’d like to talk about what I’ve learned and why these kinds of entrepreneurship are valuable to students like us. To make things easier, I’ve included a table summary at the end, so you’ll have a quick reference after reading.

Types of Entrepreneurship

1. Economic Entrepreneurship

One-sentence summary: Economic entrepreneurship is the continuous pursuit of new business opportunities with the goal of financial profit, leveraging opportunities beyond controlled resources to deliver innovative value and business models to the market.
Core information:
- Main Motivation:
  - Financial gain and wealth accumulation: The primary motivation for entrepreneurs is to generate financial returns for investors and themselves, and to increase personal wealth.
  - Sustainable business growth: Aims to grow the business to ensure long-term stability and market dominance.
  - Satisfaction from identifying and realizing opportunities: The satisfaction derived from identifying new opportunities and successfully bringing them to fruition is also a key motivator.
- Value Created:
  - Development of innovative products and services: Involves pioneering truly innovative products, creating better or cheaper versions of existing products, or targeting existing products to new customer segments.
  - Establishment of new business models: Devising new business models to increase efficiency and offer new value in the market.
  - Economic development and market expansion: Contribute to overall economic prosperity, job creation, and market growth by creating new industries and ventures.
  - Creation of a new, more satisfying equilibrium: Shatters existing unsatisfactory market equilibria by providing superior solutions, leading to new, stable equilibria that offer a significantly higher level of satisfaction for participants.

2. Policy Entrepreneurship

One-sentence summary: Policy entrepreneurship involves energetic actors engaging in collaborative efforts in and around government to promote policy innovations, aiming to disrupt the status quo and offer solutions for complex societal challenges.
Core information:
- Main Motivation:
  - Contribution to public good: Policy entrepreneurs are driven by the satisfaction of contributing to the public good, rather than financial rewards.
  - Solving societal problems: Seeks to address complex and widespread societal challenges such as climate change, urban homelessness, or federal student loan schemes.
  - Pursuit of a bigger vision for a better future: Motivated by an ambition to foster a better society for future generations.
  - Improving policy systems: Focuses on transforming policy ideas into policy innovations and changing existing policy arrangements that may be inefficient or unjust.
- Value Created:
  - Innovative policy ideas: Introduces entirely new policies or makes significant advancements on existing ones within specific jurisdictions.
  - Systemic change and improved governance: Drives sustainable change throughout policy systems, leading to improved governance and disruption of the status quo.
  - Solutions for complex problems: Develops practical solutions for complex societal issues by building bridges across multiple government agencies and societal sectors.
  - Enhanced public trust: By promoting transparency and accountability in policy, it can contribute to restoring public trust in government.

3. Public Entrepreneurship

One-sentence summary: Public entrepreneurship is the infusion of entrepreneurial spirit and innovation into the traditional structures and processes of government by public sector leaders who blend the roles of public servant and entrepreneur to improve public services and create public value.
Core information:
- Main Motivation:
  - Injecting innovation into public services: Driven by a desire to infuse government with entrepreneurial spirit and innovation, modernizing public services and processes.
  - Meeting citizen expectations: Aims to meet evolving and higher citizen expectations by co-designing services with citizens and co-producing better outcomes.
  - Efficient mobilization of limited resources: Skilled at “creating something from nothing” by leveraging financial capital, human talent, and new rules, especially in contexts of constrained budgets.
  - Improving social outcomes and public good: Focuses on improving outcomes for citizens and the public good through initiatives like ex-offender rehabilitation projects, innovative health care systems, or citizen-led service co-design.
- Value Created:
  - Enhanced public services: Provides better, more efficient public services for citizens (e.g., Singapore’s Yellow Ribbon Project for ex-offender rehabilitation, Netherlands’ Buurtzorg health model, Boston’s mobile 311 app).
  - Efficient and innovative government operations: Fosters a problem-solving spirit within organizations, promoting innovation and cross-sector collaborations that span traditional government silos.
  - New financing methods and resource utilization: Develops new ways to finance public services and development interventions, such as pooling budgets, public-private partnerships, or Social Impact Bonds (SIBs).
  - Improved societal outcomes: Drives better social outcomes and manages change across multiple settings, focusing on concrete results.

4. Social Entrepreneurship

One-sentence summary: Social entrepreneurship uses business tools and innovative, market-based approaches to address pressing social needs and achieve transformative social and/or environmental change, prioritizing social benefit over financial profit.
Core information:
- Main Motivation:
  - Passion for social mission: Driven by a deep passion to solve social problems such as poverty, marginalization, or inequality.
  - Addressing underserved populations: Targets populations that are underserved, neglected, or highly disadvantaged, who lack the financial means or political influence to achieve transformative benefits on their own.
  - Values-driven action: Motivated by core values like dignity, access to opportunity, transparency, accountability, equity, and empowerment.
  - Creating a new, stable equilibrium for social good: Aims to establish a permanent shift from an unjust equilibrium to a better future for a targeted group and society at large.
- Value Created:
  - Transformative social and environmental change: Achieves significant, lasting positive changes in society or the environment.
  - Sustainable solutions for social needs: Develops innovative products, services, production, and distribution methods, or organizational models to meet social needs in a sustainable way.
  - Empowerment of disadvantaged groups: Provides opportunities and systems for marginalized populations (e.g., microcredit for women, meaningful work for disadvantaged individuals).
  - New market-based approaches to social problems: Experiments with business models and new distribution/replication methods to create scalable solutions, often reinvesting profits for social purposes.

5. Civic Entrepreneurship

One-sentence summary: Civic entrepreneurship helps communities develop and organize their economic assets and build productive, resilient relationships across the public, private, and civil sectors, combining entrepreneurial spirit with a spirit of community to engage citizens in their own and their community’s progress.
Core information:
- Main Motivation:
  - Community and economic development: Aims to develop and organize economic assets within local communities.
  - Enhancing citizen engagement: Seeks to motivate and equip diverse citizens to work together on behalf of their community and participate in its development.
  - Building collaborative relationships: Driven to foster productive relationships across public, private, and civil sectors to solve social problems.
  - Creating social value from within any sector: Believes that leaders in government, philanthropy, business, or the nonprofit sector can spark innovation and social progress to address community development issues.
- Value Created:
  - Stronger community relationships and networks: Builds resilient relationships and fosters collaboration across various sectors, creating a more connected community.
  - New community leaders and increased participation: Identifies and trains a new generation of leaders, including those outside traditional leadership circles, empowering them to take action.
  - Innovative solutions for local problems: Helps communities address issues like poverty, housing, education, and other social challenges through local initiatives and collaborative action.
  - Sustainable community change: Encourages a broad-based, inclusive approach to leadership and problem-solving, leading to enduring positive impacts on individual lives and community success.

Summary Table & Image

This is a concise table comparing and contrasting each type of entrepreneurship for a summary:

Type	Core Focus / Definition	Primary Motivation	Key Value Created
Economic Entrepreneurship	The pursuit of new business opportunities (e.g., innovative product, new business model) beyond resources controlled, with the goal of financial profit.	Financial gain, wealth accumulation, and sustainable business growth for the entrepreneur and investors. Also, the psychic reward from realizing ideas.	Financial prosperity, market expansion, innovative products/services, new business models, and creating a new, stable market equilibrium offering higher satisfaction to participants.
Policy Entrepreneurship	Energetic actors (in or out of government) who engage in collaborative efforts to promote policy innovations and disrupt status quo policy arrangements. They invest resources (time, energy, reputation, sometimes money) hoping for future return.	Contribution to the public good and societal satisfaction. Solving complex societal problems (e.g., climate change, urban homelessness, student loan schemes). Pursuing a bigger vision for a better future.	Innovative policy ideas, systemic policy changes, improved governance (e.g., centralized regulatory review, cost-benefit analysis), and practical solutions for complex societal challenges.
Public Entrepreneurship	Public sector leaders injecting entrepreneurial spirit and innovation into traditional government structures and processes; a blend of public servant and entrepreneur. Pursues opportunity without regard to resources controlled.	Infusing entrepreneurial spirit into public services, improving outcomes, controlling costs, and sustaining access. Meeting citizen expectations and making better social outcomes by efficiently mobilizing public resources.	Enhanced and innovative public services (e.g., ex-offender rehabilitation projects, advanced health systems, mobile 311 app). More efficient government operations, and new ways of financing public services (e.g., Social Impact Bonds).
Social Entrepreneurship	Uses business tools and innovative, market-based approaches to address social needs and achieve transformative social and/or environmental change, primarily targeting underserved populations.	Passion for a social mission and solving societal problems (e.g., poverty, exclusion, inequality). Supporting underserved populations, and seeking sustainable change rooted in values (e.g., dignity, opportunity).	Transformative social and/or environmental change. New, sustainable systems for underserved populations (e.g., microcredit, nonprofit pharmaceutical companies, independent film movement). Alleviating suffering or unleashing trapped potential.
Civic Entrepreneurship	Helps communities develop and organize economic assets and build productive, resilient collaborative relationships across public, private, and civil sectors. Combines the spirit of enterprise and community. Engages citizens in their own and their community’s progress.	Community and economic development, fostering community engagement, building collaborative cross-sector relationships, and solving local community development issues (e.g., poverty, housing). Empowering citizens and local leaders.	Developed community economic assets, resilient inter-sectoral relationships, identification and training of new community leaders, increased citizen participation, and improved collaborative solutions for local community development issues.