In a recent paper, "A conceptual overview of What We Know About Social Entrepreneurship", the authors (Brigitte Hoogendoorn, Enrico Pennings, Roy Thurik) describe four schools of thought on social entrepreneurship. These four schools demonstrate, in part, that there is no apparent academic consensus on the definition of social entrepreneurship. Given the lack of consensus, I will not bother to define each school of thought (read the paper), particularly given that I find all the definitions lacking.
Where I agree with the authors is in the following statement:
"The [four] approaches ... share one main commonality: their emphasis on the creation of social value. While it is a long-held belief that entrepreneurs contribute positively to society, it is motivation and the relative importance of social value creation (as opposed to economic value creation) that distinguishes social entrepreneurs from commercial entrepreneurs (Hoogendoorn, 2011)."
The social entrepreneur looks to maximize value creation (relative importance). In the value creation-value capture framework, if one maximizes value creation then one foregoes maximizing value capture. Effectively, in social entrepreneurship value is transferred from the shareholders (in the for-profit model) by foregoing maximum profit in favor of creating more social value. In the non-profit model of social entrepreneurship, the cash position is reduced in favor of creating more social value.
Much of my thinking on social entrepreneurship is based on a paper by Felipe Santos, "A Positive Theory of Social Entrepreneurship". Santos is a Professor at INSEAD. One might argue that Santos represents a fifth school of thought on social entrepreneurship. Santos basically says that social entrepreneurship is the maximizing of value creation and satisficing for value capture. One foregoes value capture up to the point where cash flow or profit is self-sustaining in favor of creating more social value.
I prefer Santos definition because I think it forms the basis for a management approach to social entrepreneurship. More on this idea in my upcoming book.