The Role of Social Enterprise in Poverty Reduction: Analyzing Determinants of Social Enterpreneurial Success in Addis Ababa, Ethiopia

Social enterprises are organizations that blend their social mission with the motive of generating revenue (Austin et al., 2012). Their main objective is to positively influence the community while accomplishing their social mission. Social enterprises play a significant and expanding role in the entrepreneurial ecosystem of Ethiopia (British Council, 2017). Although social entrepreneurship in Ethiopia has the potential to bring about significant societal changes, there is a lack of knowledge regarding its current status and the factors that contribute to its success in achieving both social and financial goals. This study delved into the distinct factors contributing to social enterprises' success in Addis Ababa and proposed a model tailored to the Ethiopian context. The study employed a mixed-methods approach, blending qualitative and quantitative data to analyze comprehensively the factors that contribute to the success of social enterprises.

Data were gathered from 69 social companies and experts through surveys and interviews, focusing on key characteristics such as leadership, social, economic, spiritual, and policy environment. The results indicated that successful social companies are distinguished by effective leadership, strategic planning, and resilient support networks. Economic factors, such as the availability of capital and favorable market circumstances, greatly influence success. Moreover, the regulatory framework and social support systems enable or impede social companies' progress. The study also highlighted the significance of incorporating individual characteristics, such as openness, conscientiousness, and extraversion, in promoting the success of social entrepreneurs. The research underscores the need for well-defined government policies and supportive frameworks to foster a favorable climate for social entrepreneurship. The study recommends implementing capacity-building programs, funding mechanisms, a favorable policy landscape, and public awareness campaigns to stimulate the sector's growth. The study also proposes models designed to guide policymakers and stakeholders in establishing an enabling environment for social entrepreneurs to alleviate poverty and promote economic development in Ethiopia.