Digital social entities, valuable communities: How digitalization enables value co-creation for social enterprises

Abstract Enterprises prioritizing social issues over profit maximization can lead to value co-creation, especially in marginalized and unprivileged communities. In this regard, this paper explores underlying theoretical mechanisms that tie digitalization and value co-creation together for social entrepreneurship's development. The article aims to identify how digitalization enables value co-creation for social enterprises. We conduct multiple case studies, have 11 in-depth face-to-face interviews with social entrepreneurs from Azerbaijan and synthesize the findings from primary and secondary data. As a result, we reveal that digitalization enables value co-creation for social entrepreneurship through a new phenomenon, which we call Data-driven Social Co-creation (DSC), and its subcategories such as efficiency, resource mobilization, feedback loops and data utilization. Finally, we recommend the DSC framework which shows the relationship between digitalization and value co-creation in social entrepreneurship, and which is the main theoretical contribution to the social entrepreneurship literature. Additionally, we provide a research agenda on the respective research field.