Growing Pains: Legitimacy and Resource Dependence in Social Businesses in Latin America

A growing number of social businesses in developing countries provide market-based solutions to societal challenges, often with significant technical and financial backing from Western intermediary organizations. In this study, we use extensive interview data to investigate how Colombian social businesses translate and adapt novel social business practices in their ecosystem. Our analysis reveals how, in the face of local on-the-ground realities, reliance on imported practices and resources exposes Colombian social businesses to a legitimacy deficit and resource dependence. The intertwined challenges of building legitimacy and achieving resource autonomy lead to different scaling strategies that are contingent on the entrepreneur’s social identity.