Immigrant-owned small businesses' participation in diaspora philanthropy: a case study during the COVID-19 outbreak

Ximeng Chen (Department of Government, Sacred Heart University, Fairfield, Connecticut, USA)

New England Journal of Entrepreneurship

ISSN: 2574-8904

Article publication date: 12 April 2021

Issue publication date: 8 November 2021

1305

Abstract

Purpose

The concept of diaspora philanthropy contains the following two components: diasporas, who are individuals who live outside of their homelands but maintain a sense of identity with their home countries, and charitable giving provided by these diasporas to causes related to their hometowns. Often diaspora philanthropy happens through intermediary organizations such as hometown associations, internet-based philanthropic platforms and faith-based groups. Little research explores immigrant-owned small businesses as intermediary organizations for diaspora philanthropy. In the literature of social entrepreneurship, the theory of opportunity recognition provides insights on how do businesses identify opportunities for fulfilling social missions. However, it is uncertain whether this major theory can be applied to a specific context such as immigrant-owned small businesses. In this research, I aim to understand immigrant-owned small businesses' participation in social entrepreneurship through diaspora philanthropy, especially in responding to natural disasters. Specifically, three research questions were proposed: What role do small businesses play? What mechanisms do they use to partake in diaspora philanthropy? Moreover, what motivates them to participate?

Design/methodology/approach

This research uses an in-depth case study that focuses on a specific diaspora philanthropy behavior in responding to a natural disaster in the diaspora's hometown. The subject of this work is a small business owned by an immigrant in New York City, the US. To collect data on this case, the author utilized a mixed-methods design, which involves two types of qualitative data: document analysis and interview. Giving the purpose of this study, the author used thematic coding for both newspaper article data and interview data following a deductive approach.

Findings

The result shows that small businesses have an inherent advantage in building close interpersonal relationships with their customers and serve as the connector between their customers and larger philanthropic organizations. Because of their limitations on resources, small businesses collaborate with larger nonprofit organizations to do complicated philanthropic work for improved capacity. When diaspora philanthropy happens due to natural disasters in homelands, diasporas experience some level of guilt since they are not there with the people of their homeland in solidarity facing the difficulties. This guilt, which is related to cultural influences, is one of the motivations that make diasporas give to their homelands. The findings also show that the opportunity recognition theory fits well into explaining the altruistic behaviors of small businesses owned by immigrants.

Originality/value

A lot remains unknown about immigrant-owned small businesses, including their altruistic behaviors and participation in social entrepreneurship. This research expands the current knowledge on diaspora philanthropy by identifying the roles of small businesses, the mechanisms used by small businesses and the motivations of giving during natural disasters. This research also validates the opportunity recognition theory of social entrepreneurship in a specific context.

Keywords

Citation

Chen, X. (2021), "Immigrant-owned small businesses' participation in diaspora philanthropy: a case study during the COVID-19 outbreak", New England Journal of Entrepreneurship, Vol. 24 No. 2, pp. 105-121. https://doi.org/10.1108/NEJE-08-2020-0033

Publisher

:

Emerald Publishing Limited

Copyright © 2021, Ximeng Chen

License

Published in New England Journal of Entrepreneurship. Published by Emerald Publishing Limited. This article is published under the Creative Commons Attribution (CC BY 4.0) license. Anyone may reproduce, distribute, translate and create derivative works of this article (for both commercial and non-commercial purposes), subject to full attribution to the original publication and authors. The full terms of this license may be seen at http://creativecommons.org/licences/by/4.0/legalcode


1. Introduction

The US, as the country with the world's largest immigrant population, currently has more than 40 m foreign-born residents, which accounts for 13.7% of the overall population (Budiman, 2020). The immigrant population in the US is also highly diverse since almost all countries in the world are represented (Budiman, 2020). Among all of the represented countries, Mexico, China and India are the three countries that are among the top (Budiman, 2020).

Since the 1980s, the Chinese immigrant population in the US has steadily increased from 300,000 to more than two million today (Batalova and Echeverria-Estrada, 2020). Interestingly, Chinese immigrants tend to cluster in major cities, with more than half living in just two states: California and New York (Batalova and Echeverria-Estrada, 2020). In the greater New York City area, for example, there are nearly 500,000 Chinese immigrants, which account for 2.4% of the overall metropolitan area population (Batalova and Echeverria-Estrada, 2020).

One of the most populous career choices for Chinese immigrants, especially those who do not have a higher education background, is small restaurants (Salisbury, 2018). Approximately, there are more than 40,000 Chinese restaurants in the US, which cover almost every single corner of the country (Hilgers, 2014). Chinese immigrants generally own these Chinese restaurants and usually employ Chinese immigrants.

Research shows that foreign-born individuals are more likely to engage in philanthropic giving related to international causes (Casale and Baumann, 2015; Rajan et al., 2009). International causes are reasons for individuals or organizations to give outside of the countries they reside in. This conclusion is supported by the remittance data from the World Bank: China has become the second-largest recipient of remittance, after India, since 2016, and took around $70 m in remittances in the year 2019 (Batalova and Echeverria-Estrada, 2020). Indeed, immigrants usually are motivated to give back to their home communities. This phenomenon of giving back is called diaspora philanthropy in academic terms. Even though research on diaspora philanthropy is still yet to be developed, more attention has been attracted to this field (Sidel, 2008).

While individuals can give directly to their families and friends at home, a lot of diaspora philanthropy happens through organized efforts (Flanigan, 2017). For example, Chinese diasporas around the globe have organized numerous fundraisers after the coronavirus disease 2019 (COVID-19) outbreak happened in January 2020 to donate money and supplies to hospitals in China. Wuhan, the capital city of Hubei province, is the city where the first case of COVID-19 was reported, and the city experienced extreme hardship from mid-January to early April 2020 (Taylor, 2020; World Health Organization, 2020). Being the first place facing the deadly disease, Wuhan experienced city-wide lockdown, lack of medical resources, lack of food supply and mental health challenges to both medical professionals and quarantined citizens. The Chinese government reacted fast to assemble volunteer doctors and nurses from all around the country to go to Wuhan, helping with fighting the disease (UN News, 2020). In the meantime, resources from other countries, organized by diaspora Chinese started to get transported back to Wuhan. Hometown associations are one of the early responders (Yellow Crane Club, 2020). Hometown associations are organizations composed of migrants who come from the same town and reside in the same host country, which serve social and mutual-aid purposes (Orozco and Garcia-Zanello, 2009). Yellow Crane Club, an example of hometown associations, run by Chinese diasporas who come from Hubei province and live in New York City, raised more than 100,000 dollars among its members and the broader community within two days to purchase medical supplies for donation (Yellow Crane Club, 2020). As another example, Beijing Association of Greater Washington, even though not a Hubei or Wuhan specific hometown association, announced on January 28th, 2020 that they were raising funds to purchase and transform medical supplies to support Wuhan and other cities in Hubei province (Beijing Association of Greater Washington, 2020).

While nonprofit organizations, such as hometown associations, participate in diaspora philanthropy, do immigrant-owned businesses play a role in diaspora philanthropy? A lot remains unknown about immigrant-owned businesses' participation in diaspora philanthropy. For example, knowing that there is a large number of Chinese immigrant-owned small businesses in the US, do they participate in diaspora philanthropy at all? If they do play a role, what are the mechanisms by which they participate in diaspora philanthropy? Lastly, what motivates small businesses to participate in diaspora philanthropy, especially in responding to natural disasters that happened in their homelands?

In the meantime, opportunity recognition theory indicates that businesses participate more in fulfilling social missions when opportunities present (Corner and Ho, 2010; Dacin et al., 2011). Do immigrant-owned small businesses identify social entrepreneurship opportunities the same way as other organizations? While the literature on opportunity recognition theory from social entrepreneurship identifies some features of how businesses recognize opportunities (Corner and Ho, 2010), do those same features apply to immigrant-owned small businesses?

To fill in the gap in the current literature, this paper aims to use one in-depth case study to show how small businesses involve in diaspora philanthropy in responding to natural disasters. Specifically, this research expands on the literature of diaspora philanthropy by exploring the roles that small businesses play, what mechanisms they use and what their motivations are. The paper is organized as follows. I first review the literature on diaspora philanthropy and identify the limitations of the current body of literature. Then I describe the methodology used to answer the research questions. After that, I present the findings identified from the data. In the last section, I summarize and conclude the study.

2. Literature review

2.1 Diaspora philanthropy

Diaspora philanthropy is a relatively new research topic and is one of the most under-researched sub-fields within philanthropic studies (Brinkerhoff, 2014; Johnson, 2007). In order to define diaspora philanthropy, one has to understand the meaning of diasporas first. In a recent study on diaspora philanthropy, the author Flanigan (2017) uses a definition of diasporas from a seminal work by Sheffer (1986): diasporas are migrants who live in host countries but remain emotionally and monetarily connected with their homelands (Sheffer, 1986, p. 3, as cited by Flanigan, 2017, p. 494). This definition highlights two characteristics of diasporas: living in host countries and maintaining tight connections with their homelands. It also highlights the difference between diasporas and immigrants. While diasporas are very conscious of their connections to their home countries, immigrants may or may not have that same level of awareness of their roots and origins.

Diaspora philanthropy, while there is no consensus on how exactly to define the term, generally contains the following two components: diasporas, who are individuals who live outside of their homelands but maintain a sense of identity with their home countries, and charitable giving provided by these diasporas to causes related to their hometowns (Johnson, 2007; Newland et al., 2010). While research on diaspora philanthropy is in its early stage (Brinkerhoff, 2014), more recent work on this topic has emerged and generated some knowledge on mechanisms of diaspora philanthropy and motivations of diaspora philanthropy (Flanigan, 2017).

Remittances by diasporas to their home countries generally happen through two mechanisms: by individuals directly to their home countries or through intermediary organizations (Newland et al., 2010). On the one hand, when remittances happen directly from individuals to their homelands, the money generally goes to immediate or extended family members (Sidel, 2008). Diaspora philanthropy through intermediary organizations, on the other hand, do not necessarily benefit family members of diasporas directly, but the overall welfare of people in homelands (Flanigan, 2017; Sidel, 2008). These intermediary organizations contain hometown associations, internet-based philanthropic platforms, faith-based groups, professional associations, diaspora foundations and more (Newland et al., 2010). Among the intermediary organizations of diaspora philanthropy, hometown associations are the most studied since diaspora philanthropy is generally one of their organizational missions (Sidel, 2008). The rise of online platforms for fundraising in recent years also provide convenient channels for collecting and transferring funds from host countries back to homelands (Flanigan, 2017).

The general literature on philanthropic giving sheds some light on why diasporas are motivated to give to their homelands. Research shows that when an individual is foreign-born or has some transformative foreign experiences, it is more likely for the individual to give to international causes (Appe and Oreg, 2020; Casale and Baumann, 2015; Rajan et al., 2009). In diaspora philanthropy literature, more specifically, two primary reasons were identified to explain the motivations of giving by diasporas. First, diasporas usually identify themselves strongly with their homelands' cultures, histories and languages (Sidel, 2008; Werbner, 2002). These identities usually make diasporas form close emotional connections with their home countries, even when they and their immediate families do not live there anymore (Sidel, 2008). Second, it is more likely that the diasporas in host countries have made better lives and maintained a higher quality of life, compared to people who are still at home (Brinkerhoff, 2014; Flanigan, 2017). These factors tend to make the diasporas shape a sense of obligation to provide help to people who are left behind (Brinkerhoff, 2014). In some cases, cultural norms of diasporas' home countries dictate that it is the family members' responsibility to meet people's social needs, which makes diasporas obligated to become providers for families or clan members who still live in homelands (Brinkerhoff, 2014; Flanigan, 2017; Tchouassi and Sikod, 2010).

There are both advantages and disadvantages of having diasporas giving to their homelands. On the one hand, diasporas who had first-hand experiences in the home countries may know better about the nuanced needs and feasible solutions to problems than other potential donors who do not have the same perspectives (Johnson, 2007; Newland and Patrick, 2004). On the other hand, having an obligation to give back to their hometowns may become a burden for diasporas, especially when they are trying to settle in an entirely new life (Brinkerhoff, 2014).

Even though more research on diaspora philanthropy has emerged in recent years, the current literature has primarily focused on country-level descriptions and has its profound limitations (Johnson, 2007; Sidel, 2008). First, there is a significant lack of studies that focus on understanding the specific experience of organized diaspora philanthropy (Johnson, 2007). Second, the role of intermediary organizations in diaspora philanthropy remains unexplored (Sidel, 2008). Third, more in-depth cases on specific localities and selective organizations are needed (Sidel, 2008). Last, very few research studies look at diaspora giving in response to emergencies such as natural disasters (Sidel, 2008).

2.2 Opportunity recognition theory and social entrepreneurship

Opportunity recognition theory has been a foundational theory in entrepreneurship that emphasizes how individuals identify for-profit business opportunities (Alvarez and Barney, 2007). In general, opportunities may be discovered in two ways: rational approach and effectuation (Alvarez and Barney, 2007; Sarasvathy, 2001). Rational approach views opportunities as an objectively existing phenomenon, which alert individuals may discover through rational thinking (Alvarez and Barney, 2007). Effectuation, as an alternative to the rational approach, does not view opportunities as precise goals. This approach believes that as individuals make the decisions that aim toward the general idea, opportunities may emerge. Individuals may not know exactly what the opportunities are when they start the process but would have opportunities in the end as long as they allocate the resources, personnel and skills (Sarasvathy, 2001).

The phenomenon of businesses engaging in fulfilling social missions when opportunities are present is called social entrepreneurship (Corner and Ho, 2010; Dacin et al., 2011). Opportunity recognition theory has been initially applied to social entrepreneurship to explain how entrepreneurs identify opportunities that fulfill social missions (Corner and Ho, 2010). For instance, entrepreneurs may create social values through participating in philanthropic activities (Hockerts, 2006). According to this theory, social entrepreneurs recognize opportunities based on the social missions they try to fulfill and/or their personal backgrounds (Dees, 1998; Shane, 2000). While it is critical to understand how opportunities are recognized in social entrepreneurship as opportunity recognition is what defines social entrepreneurship (Mair and Marti, 2006), researchers argue that we still do not know much about the process of opportunity identification outside of for-profit entrepreneurship (Shaw and Carter, 2007).

Corner and Ho’s (2010) seminal work addresses this limitation and aims to understand the process of opportunity recognition in social entrepreneurship. Their research has indicated four features. First, unlike for-profit opportunity recognition, opportunity identification in social entrepreneurship does not fit neatly into either rational approach or effectuation. Opportunities are not purely discovered or created. Instead, coming up with innovative ideas of creating social values and implementing them follow an organic pattern and happen recursively. As a result, the process of opportunity recognition can range from primarily rational to entirely effectuation. Second, individuals tend to work together in collectives in creating social values, as a single person may not possess all needed information. Third, entrepreneurs' past life experience is a critical factor in being aware of information and opportunities to create social values. Finally, individuals generally experience “the spark” (p. 653), an awakening moment that tells them that their behaviors could create social values. More research is needed to validate the application of opportunity recognition theory to the field of social entrepreneurship (Corner and Ho, 2010).

2.3 The context of this research: immigrant-owned small businesses' participation in diaspora philanthropy

One type of organization that has deep connections to diasporas is immigrant-owned businesses. The literature of business and economy has documented extensively the contributions immigrant-owned businesses have made to the economy in the US. Recent data shows that “immigrant-owned firms generate over $775 billion in revenue, $125 billion in payroll, and $100 billion in income, and employ one out of every ten workers” (Wang and Liu, 2015, p. 345). Also, data collected from the 2007 Survey of Business Owners indicates that while the average sales among all firms are $1,108,464, immigrant-owned firms have average sales of only $433,592 (Fairlie, 2012). The above data show that there is a large group of immigrant-owned businesses that are small operations.

Even though there is a large number of immigrant-owned small businesses, a lot remains unknown about them, including their altruistic behaviors and the extent to which they engage in social entrepreneurship. While the current literature on diaspora philanthropy has explored the role of many different types of diaspora-related organizations, such as hometown associations and faith-based organizations, almost no research has studied immigrant-owned businesses' participation in diaspora philanthropy. In the meantime, inspired by the opportunity recognition theory, this research focusses on the following questions: how do immigrant small business owners identify opportunities for participating in diaspora philanthropy? Do they follow the rational approach or the effectuation approach? Do they work with other actors in their philanthropic activities? What are the reasons that they are involved in certain philanthropic activities than others? Furthermore, what are “the spark” moments for them?

Further understanding of immigrant-owned small businesses' involvement in social entrepreneurship through diaspora philanthropy will contribute to both diaspora philanthropy and social entrepreneurship literature. On the one hand, adding immigrant-owned small businesses into the profile of intermediary organizations will make the diaspora philanthropy literature more comprehensive. On the other hand, applying the opportunity recognition theory from the social entrepreneurship literature to immigrant-owned small businesses will validate the major theory in a particular context.

2.4 Research questions

Addressing the current gaps in diaspora philanthropy literature and applying the opportunity recognition theory to a specific context, this research aims to answer the general question of what immigrant-owned small businesses can do regarding diaspora philanthropy? More specifically, I propose to answer three research questions:

  1. What role does small business play in diaspora philanthropy?

  2. What are the utilized mechanisms for diaspora philanthropy by small businesses?

  3. What are the motivations of small businesses to participate in diaspora philanthropy during natural disasters?

3. Methodology

To answer the research questions, I use an in-depth case study that focuses on a specific diaspora philanthropy behavior in responding to a natural disaster that happened in the diaspora's hometown. The subject of this work is a particular small business owned by an immigrant in New York City, the US.

3.1 Why case study?

Since small business participating in diaspora philanthropy is an understudied phenomenon, using an in-depth case study which can exemplify the phenomenon is a good strategy of exploration. “Any exemplar of a phenomenon of interest can be a worth single-case study…in which the case offers insights that stand alone as important” (Patton, 2014, pp. 273–274). In this paper, I use a case study to answer the three research questions regarding roles played, mechanisms used and motivations of immigrant-owned small businesses participating in diaspora philanthropy.

The case is about a small noodle house located in an immigrant community in New York City. The owner of the noodle house is an immigrant himself. The following methodology section is organized around four themes: introducing the noodle house, knowing about the owner and his career path, describing the data collection choices and reasons and finally presenting the data analysis approaches.

3.2 The small business: heat noodle, flushing, New York

Opened in July 2019, Heat Noodle has received an overwhelming welcome as a small noodle house in Flushing, New York, especially from the diasporas who come from Wuhan, Hubei province, China and currently live in New York City and surrounding areas. The tiny noodle house has less than 300 square feet of space in a food mall and employs only five people, including the owner himself. While most of its customers are Chinese, it is an excellent add-on to the already diverse food choices in New York City.

Heat Noodle is located in the busiest mall in the center of Flushing, Queens, New York. Flushing is one of the three largest Chinese communities in New York City, along with Manhattan Chinatown and Brooklyn Chinatown (FreshNYC, n.d.). Flushing is home to fifty-five thousand Asians, which accounts for more than 67% of the entire population in the neighborhood (Statistical Atlas, n.d.). Flushing is indeed a “foodies paradise” as the Chinese food there represents almost every province in China and is significantly cheaper than other Chinatowns in New York.

Today, Wuhan is a city known by many because of COVID-19. However, Wuhan was always known by Chinese people as a vibrant city that has so much to offer from its local cuisine. Heat Noodle specializes in a niche food category, Wuhanese breakfast. As suggested by its name, Heat Noodle features the most popular Wuhanese breakfast item: re-gan-mian, or hot and dry noodles. This food category is such a niche and hard to find outside of China, even outside of Hubei province. For the diasporas, however, this type of food is what they remember as the taste of home. Heat Noodle received outstanding reviews from day one and has since gathered a large group of loyal customers. On the Chinese social media platform WeChat, Heat Noodle has a group of more than 600 followers, who are mostly Wuhanese diasporas who live in New York City or nearby areas. Each bowl of re-gan-mian sells for 6.5 dollars. Along with a few other items on the menu, Heat Noodle manages to afford an expensive monthly rent of 13,000 dollars per month.

3.3 The small business owner

The owner of this noodle house, DaXiong, is originally from Wuhan. Now in his 30s, DaXiong has explored many different career paths before opening Heat Noodle, starting as a photographer in Wuhan. He moved from Wuhan to New York City in 2014 since New York is his wife's hometown. In New York City, DaXiong has worked in a Chinese-owned business that frames and decorates calligraphy and paintings for customers, has been an Uber driver and has operated a home-based small kitchen for food deliveries. Because of his abundant experience, he got to know others who also come from Wuhan. That was when he realized that there was no specialized Wuhanese restaurant in New York City while there may be a large group of potential customers.

Knowing that investing in a restaurant may be out of reach financially and becoming a business owner can be challenging, DaXiong decided to start small and be as prepared as he could. He rented a small store located in a food mall in Flushing, which is the largest Chinese community in New York City. He also traveled back to China to learn from the experts on how to make authentic Wuhanese breakfast items. In July 2019, he officially became a small business owner.

When the COVID-19 outbreak happened in Wuhan in January 2020, DaXiong responded rapidly and organized a small fundraiser among his customers, who are primarily Wuhanese diasporas in New York City or nearby areas. DaXiong's philanthropic behavior in responding to the natural disaster COVID-19 has then attracted attention from me as a case study on small businesses participating in diaspora philanthropy.

3.4 Data collection

To collect data on this case, I utilized a mixed-methods design, which involves two types of qualitative data: document analysis and interview. On the one hand, document analysis is based on existing secondary documents such as government reports, newspaper articles and other types of documents. Interview, on the other hand, involves understanding perspectives from informed individuals. Having two types of data sources significantly increases the quality and credibility of qualitative studies since data triangulation brings different aspects of empirical reality (Patton, 2014).

I first identified eight pieces of English language newspaper articles referring to Heat Noodle from February to March 2020. The reason that these newspaper articles are all from this short timeframe is that by then, the COVID-19 outbreak had happened in Wuhan, and Heat Noodle was generally used as an example of how Chinese immigrant-owned businesses in the US have suffered from COVID-19-related fear and discrimination. These newspaper articles provide valuable data on the small noodle house's history, featured food and challenges faced. Some of the newspaper articles also briefly mentioned the philanthropic fundraiser DaXiong had organized in January 2020 to support Wuhan, which led me to use another data collection method: interviewing DaXiong. A list of newspaper articles used can be found in Table 1.

The primary reason for choosing the in-depth interview method of data collection is to gather all of the detailed information on the fundraiser. To achieve this goal, interviewing DaXiong first-hand was a good approach. I contacted DaXiong on the Chinese social media platform WeChat and had an hour-long conversation over the phone with him on the evening of August 18th, 2020. Even though by then COVID-19 has already become a pandemic, DaXiong's philanthropic behavior happened in late January and early February 2020, when COVID-19 was still defined as an epidemic with the epicenter in Wuhan, China. While I took detailed notes during the interview, the conversation was also audio recorded with the participant's permission. The Institutional Review Board of my institution approved the research design, which involves human subjects and the interview protocol.

3.5 Data analysis

Qualitative data analysis involves making sense of the raw data by me. “No absolute rules exist, except perhaps this: Do your very best with your full intellect to fairly represent the data and communicate what the data reveal given the purpose of the study” (Patton, 2014, p. 522). Giving the purpose of this study, I used thematic coding for both newspaper article data and interview data following a deductive approach. That is, using the three research questions as guides to identify themes and patterns from the data, aiming to answer the research questions. This same method has been applied to both the newspaper articles and the interview transcripts. Three themes emerged from the data, corresponding to the three research questions: the connector, collaboration for improved capacity and “doing what I can when I cannot be there.” The following section presents the findings identified by the data analysis process.

4. Findings

This paper studies small businesses' involvement in diaspora philanthropy. The findings section contains four parts. The first part introduces the detailed process of the fundraising event organized by the small business owner in January 2020. The second to fourth parts present the three themes identified from data analysis aiming to answer the three research questions, respectively.

4.1 The fundraising event in January 2020

January 2020 was an unforgettable month for many Chinese, especially Wuhanese people. On January 23rd, the Chinese government decided to shut down the city of Wuhan, aiming to stop the spread of COVID-19. Ten million people in Wuhan were quarantined in their homes, hoping that their temporary suffering and sacrifice could help the rest of the country and the world. While people who got locked in Wuhan faced fear, the disease, and lack of resources, the Wuhanese diasporas around the globe felt just as much pain. Indeed, Wuhan is the city where their families and friends still live in, and Wuhan is what the diasporas call home.

When Wuhanese diasporas everywhere in the world started to respond rapidly to the outbreak of COVID-19 in Wuhan, the owner of Heat Noodle DaXiong also felt the obligation to do something. Some of his friends who were in Wuhan started to do volunteer work right after the shutdown, such as driving doctors and nurses to work when there were no taxi services and delivering medical supplies to frontline workers. Being away from home, DaXiong felt that he had to do something in solidarity with his people.

While DaXiong was extremely passionate about doing something for Wuhan, he knew that, as a small business owner who has only been in business for half a year, he could not do as much as he would want to. He did not have much money to donate or any resources to get medical supplies to Wuhan. What he did have was access to a group of Wuhanese diasporas who have been customers to his noodle house. He thought that organizing a small fundraiser may be a good idea and was confident that he would get positive responses.

The next question was how to make sure the funds raised could be used in the most in-need areas rapidly. DaXiong noticed from his contacts that Wuhan University Greater New York Alumni Association (WUGNYAA), a nonprofit organization that has many members with well-connected social networks, is also organizing a fundraiser. In fact, WUGNYAA was one of the quickest diaspora organizations which responded to the disaster. On the first day of Wuhan's shutdown, WUGNYAA announced its fundraiser and started to purchase medical supplies and to figure out transportation through its members' networks.

DaXiong has previously worked with WUGNYAA and knew that its leadership was a group of passionate and reliable people. He decided to donate to their fundraiser, not only from his own pocket but also from any money he could raise from his loyal customers. On January 23rd, 2020, DaXiong posted the following message in his customers' group chat on WeChat:

Dear all,

Heat Noodle, along with Wuhan University Greater New York Alumni Association, initiated a fundraiser to support Wuhan. We accept both cash and Zelle transfers as ways of donation (Zelle account number: XXXXXXXXXX, name: XXX). Heat Noodle, starting from today, will donate one dollar per bowl of re-gan-mian sold to add to the donated funds and will provide a free bowl of re-gan-mian as an appreciation to those coming to the store to donate in person. We will not necessarily use the name of Heat Noodle in the donation. All credits go to our customers. All of the donations will be documented in detail, and we will make sure the process is transparent all along until the funds go to use. The deadline for donation is Sunday, January 26th. We hope to help our fellow Wuhanese people, who are currently in a locked city.

More than expected, this message by DaXiong triggered hundreds of discussion threads in the group chat by people who were all passionate about the fundraiser and wanted to do their part to help their home city or at least their home country. On January 26th, 2020, within only three days, DaXiong received 320 dollars in cash and 1810 dollars through Zelle transfers from his customers. Some of DaXiong's customers donated directly to the GoFundMe account by WUGNYAA, and those donations are not counted in these numbers. DaXiong himself eventually donated 870 dollars to make the total number of the donation to 3000 dollars, even though he did not sell 870 bowls of re-gan-mian during the three days. He posted the screenshot of his donation of 3000 dollars in the group chat on the same day and received many compliments from his fellow diaspora Wuhanese in New York City areas.

4.2 The connector

What role does small business play in diaspora philanthropy? As mentioned in the literature review, diaspora philanthropy generally happens through two channels: direct giving by individuals, usually to support their immediate or extended family members or through intermediary organizations to support specific populations or causes (Newland et al., 2010). While the current literature has not yet reached an agreement on how to define an intermediary organization, it is commonly agreed that intermediary organizations have the capacity to receive funds from the diasporas, transfer funds back to home countries and utilize funds for specific causes in home countries (Flanigan, 2017; Newland et al., 2010).

Are small businesses another type of intermediary organizations in diaspora philanthropy, such as hometown associations or faith-based organizations? This research shows that the answer to this question is no. First, small businesses, even if owned by immigrants, generally have profit-making as the primary goal. Philanthropic giving only happens in relatively extreme cases. In the case of Heat Noodle, the owner DaXiong has mentioned in the interview that this small fundraiser right after the COVID-19 outbreak was the only philanthropic event he has organized since they opened. Moreover, it only happened because the beneficiaries were people in desperate need in extreme situations from his and many customers' hometown city. DaXiong stated in the interview: “under that kind of circumstance, I needed to do something, even though I may not have a lot of resources.” Indeed, different from many nonprofit organizations, philanthropy is not a priority for small businesses.

Second, small businesses generally do not have the capacity to identify donors, collect funds from donors, transfer funds to distant communities or utilize funds effectively and efficiently for the right causes. Even in situations where small businesses want to prioritize philanthropy and organize philanthropic events, they generally cannot do it by themselves. In the case of Heat Noodle, the COVID-19 outbreak that happened in Wuhan in January 2020 was such a compelling cause and immediately triggered the owner's intention to provide support. Nevertheless, he initially had no idea how to operationalize his idea by himself.

While small businesses do not have philanthropy as their mission and do not have the capability of doing philanthropy by themselves, what do they have that contributes to diaspora philanthropy? The answer is customers. A small business with a group of loyal customers has an inherent advantage in doing diaspora philanthropy, primarily if owned by immigrants. Different from large business operations, small business owners have unique opportunities to build interpersonal relationships with their customers and form a sense of community. It is even more so when the owner belongs to an immigrant group and has a type of business that speaks to the same immigrant community. DaXiong mentioned that many of his customers found that being in the WeChat group started by him make them feel connected to other Wuhanese people in New York City and has provided a sense of belonging to them. Not only do they use the group chat as a place to know the most updated menu and sometimes put in re-gan-mian pick-up orders with DaXiong, but they also see the group chat as a place to exchange information and help each other out. Group members often ask questions in the group chat, such as: where can I find Wuhanese specialized groceries? Does anyone know some Wuhanese nannies who are currently looking for jobs? Is it okay to park in front of the food mall temporarily so that I can pick up my order from Heat Noodle? These questions always get answered by other customers of DaXiong, who also are Wuhanese diasporas. The networking and communication opportunities provided by this group gives DaXiong a significant advantage in doing diaspora philanthropy.

So, if not intermediary organizations, what is the role of small businesses in diaspora philanthropy? This research shows that they are the connectors. Because of the interpersonal relationships owners may have developed with their customers, they have the ability to easily connect people, not only within their customers' group but also to external individuals and organizations. Indeed, relationships, also called “Guanxi” in Chinese, have always been an important factor in the Chinese context (Chen and Chen, 2004). In the case of Heat Noodle, DaXiong was able to raise 3000 dollars within three days only because he had this group of loyal customers he could easily connect through social media. Some of DaXiong's customers found out about the larger fundraiser organized by WUGNYAA through him, to which DaXiong donated the 3000 dollars, and directly donated to WUGNYAA. In that case, DaXiong was the connector between his customers and an external philanthropic organization.

To sum up, small businesses generally do not have the mission or capacity to do diaspora philanthropy by themselves and thus cannot be intermediary organizations for diaspora philanthropy. They usually, however, have close interpersonal relationships with a group of loyal customers to whom they can easily connect. This research shows that small businesses play a connector role in diaspora philanthropy. Figure 1 shows the role of small businesses in the overall diaspora philanthropic process.

4.3 Collaboration for improved capacity

What are the utilized mechanisms for diaspora philanthropy by small businesses? While small businesses have no mission or capacity for doing philanthropy by themselves, how do they make things happen when they want to? This case study shows that small businesses rely on larger organizations for improved capacity in doing diaspora philanthropy. Specifically, small businesses serve as the connector between individual diasporas and larger organizations. While providing some funds to larger organizations, small businesses rely solely on larger organizations to collect funds, use the funds to purchase supplies, transport supplies to distant communities and distribute supplies in distant communities. In other words, small businesses need collaboration, generally with larger organizations, for improved capacity in diaspora philanthropy.

In the case of Heat Noodle, DaXiong was glad that he found out about the larger fundraiser organized by WUGNYAA. Wuhan University is one of the oldest universities in China with a reputation both nation-wide and internationally. Since its founding in 1893, Wuhan University has educated thousands of Chinese in all disciplines, who have formed many locality-based alumni associations around the world. The Greater New York chapter, among many other Wuhan University alumni associations, was one of the highest contributing organizations in donating medical supplies to frontline workers in Wuhan right after the outbreak when resources were the scarcest and most needed. Thanks to the well-connected alumni network, WUGNYAA was able to do everything needed for diaspora philanthropy in time. WUGYAA raised funds from alumni and their respective communities within a very short period, purchased a large number of medical supplies directly from manufacturers, worked with Chinese airlines to arrange international transportation, made sure that the supplies successfully met Chinese customs regulations and distributed the supplies utilizing the alumni network in Wuhan as quickly as possible (Wuhan University Great New York Alumni Association, 2020).

According to DaXiong, he had previous experience working with WUGNYAA and found the leaders to be a group of passionate and reliable people. From that experience, DaXiong had built trust in WUGNYAA, which was a critical factor later when he decided to donate to them to help Wuhan in January 2020. When the outbreak happened, knowing that WUGNYAA immediately started putting efforts in diaspora philanthropy made him feel that his passion can be realized through them. DaXiong took the initiative and contacted his acquaintances in the WUGNYAA's leadership team, proposing his idea of contributing to their fundraiser by organizing a smaller fundraiser within his customers' group. WUGNYAA immediately welcomed his idea, but DaXiong knew he was on an extremely tight timeline to get as many funds as he possibly can. Three days later, because of the collaborative relationship he had built with WUGNYAA, DaXiong was able to leverage on his small Wuhanese noodle house and make his contribution to supporting Wuhan.

Interestingly, during the three days of fundraising time within DaXiong's WeChat group, some group members, who are both DaXiong's customers and Wuhan University alumni, also helped DaXiong to promote his mini fundraiser. Because of both DaXiong and those dual-identity group members, WUGNYAA made the impression of being an efficient and trustworthy organization. It is reasonable to believe that this factor contributed to DaXiong's success in raising funds within three days. While $3000 is not a lot of money, it is one of the representative outcomes of diaspora philanthropy. The philanthropic behavior is seen as more important than the actual amount of funds raised by DaXiong.

This finding is consistent with the literature of inter-organizational collaboration that trust is a determining factor in any success of inter-organizational collaboration. Research shows that successful past collaboration experience contributes to the perceived trustworthiness of the trustee. If the trustor perceives that the trustee is trustworthy, the trustor will decide to trust the trustee (Lambright et al., 2010).

It is worth mentioning the role of the social media platform WeChat in the process of collaboration. Small businesses like Heat Noodle increasingly utilize WeChat as a platform for communications and unity. In this case, DaXiong's fundraising process from his customers and collaboration with the alumni association both happened on Wechat. Not only the technology enables the small business to recruit and maintain its customers, but it also provides ways of instant fund-transferring, which makes the fundraising process easy and quick.

To sum up, collaborating with WUGNYAA was the reason that Heat Noodle made an impact on diaspora philanthropy quickly and effectively during the COVID-19 outbreak in Wuhan. Without the collaborative relationship, DaXiong and his Heat Noodle would have no capacity to complete this complicated job. This case study shows that only by collaborating with larger organizations, small businesses can improve their overall capacity in doing diaspora philanthropy.

4.4 The influence of culture: “doing what I can when I cannot Be there”

What are the motivations of small businesses to participate in diaspora philanthropy during natural disasters? The literature on diaspora philanthropy presents two types of motivations: diasporas' emotional connection with homelands, which shapes their identities, and diasporas' sense of obligation to help because many diasporas have made relatively high quality of life compared to people at home (Brinkerhoff, 2014; Sidel, 2008). Both of these reasons are true in the case of Heat Noodle. However, these reasons do not explain why small businesses participate in diaspora philanthropy responding to natural disasters.

The subtitle of this section, “doing what I can when I cannot be there,” is a direct quote from DaXiong, and it explicitly explains the third type of motivation for participating in diaspora philanthropy: diasporas' guilt of not being physically there to help relieve the suffering. Wuhan had faced extreme difficulties when the lockdown happened. For example, all public transportation was stopped, and personal vehicles were not allowed to go on the road so that the government can enforce the quarantine. As a consequence, doctors and nurses were not able to go to work easily during the initial stage. DaXiong's friends in Wuhan immediately organized a team of volunteers, applied for permission to be on the road, and voluntarily provided free transportation to doctors and nurses. After knowing the stories from his friends, DaXiong felt that it would be much better if he could be there in Wuhan. If he were in Wuhan, even though he may be in more danger of getting the virus, he would be able to do things physically to help those in need. DaXiong figured that since he was not there facing the difficulties with his people, the only thing he could do was to donate money so that more medical supplies can be purchased and transported to the frontline in Wuhan as fast as possible to protect the people.

In the face of a natural disaster, diasporas who have strong emotional ties with their homelands and who feel the responsibility to help also experience some level of guilt since they are not there facing the difficulties in solidarity with their people. This case study shows that it is the guilt that motivates diasporas to do their part in facing natural disasters and to react as fast as they can. Guilt is one of the motivations for diasporas to engage in philanthropic giving in responding to natural disasters.

The reason DaXiong had a sense of guilt is tightly related to the Chinese culture as well. As explained by the institutional theory in organizational studies, individual social behaviors are heavily influenced by social norms and routines (Scott, 2008). The Chinese culture has long been emphasizing collectivism and compassion (The Chinese Culture Connection, 1987). As a result, individuals have a strong bond with society and feel responsible for serving social purposes. While others are contributing to society, individuals like DaXiong, who are not able to contribute directly, develop a sense of guilt, which can become a motivation of giving.

5. Discussion and conclusion

In this study, I aim to better understand immigrant-owned small businesses' participation in diaspora philanthropy, especially in responding to natural disasters. Specifically, three research questions were proposed: What role do small businesses play? What mechanisms do they use to partake in diaspora philanthropy? Moreover, what motivates them to participate? The case study on Heat Noodle, a small Wuhanese immigrant-owned noodle house in Flushing, New York, provides answers to these questions.

Different from some nonprofit organizations, such as hometown associations and faith-based organizations, small businesses generally do not have philanthropy as one of their goals. Small businesses also have limited capacity to do philanthropic work, both financially and organizationally. As a result, small businesses are not intermediary organizations in diaspora philanthropy. Instead, they have an inherent advantage in building close interpersonal relationships with their customers and serve as the connector between their customers and larger philanthropic organizations.

Because of their limitations on resources, small businesses collaborate with larger nonprofit organizations in the process of doing complicated philanthropic work for improved capacity. Having a trusting relationship with a large nonprofit organization is one of the critical factors that contribute to the mechanism of diaspora philanthropy utilized by small businesses. Pleasant past experience working with larger nonprofit organizations is a primary reason that small business owners have trust in large nonprofit organizations.

Other than the two motivating factors mentioned in the literature of diaspora philanthropy: emotional connections to the homelands and sense of obligation because of improved quality of life, diasporas have one more motivation when participating in diaspora philanthropy. Especially when diaspora philanthropy happens as a result of natural disasters in homelands, diasporas experience some level of guilt since they are not there with the people of their homeland in solidarity facing the difficulties. This guilt is one of the motivations that make diasporas give to their homelands.

In the meantime, this case study validates the opportunity recognition theory in social entrepreneurship literature in a specific context. Corner and Ho (2010) have identified four features of how social entrepreneurs identify opportunities. First, opportunities may not be purely created or discovered. Having innovative ideas and implementing these ideas may happen simultaneously and recursively. Second, businesses may work collectively to achieve social missions. Third, business owners' past life experiences are reasons why they have information on certain opportunities. Fourth, individuals may experience moments of “the spark” when they identify opportunities. All of these features apply well to this case, which indicates that the opportunity recognition theory does speak to immigrant-owned small businesses' participation in diaspora philanthropy.

First, DaXiong identified the opportunity to donate back to Wuhan because he wanted to do something for his hometown under the extreme situation, had access to a group of loyal customers, and found out about WUGNYAA's large fundraiser. It indicates that he neither created this opportunity to participate in diaspora philanthropy all by himself nor purely discovered about this opportunity. He had the internal motivation to do something to help out. But without his customers' support or WUGNYAA's capacity, he himself may not be able to do as much. However, this opportunity of diaspora philanthropy was not just there waiting for him to discover. He had to identify the opportunity to donate to WUGNYAA, raise funds among his customers, handle the logistics and maintain transparent communication in the group chat. Second, the immigrant-owned small business, in this case, collaborated with other actors, namely their customers and the alumni association, in fulling social missions. The small business could only participate in social entrepreneurship through such collaborations since it has limited capacity. Third, the small business owner DaXiong has extensive experience living in Wuhan. As a result, he has intense emotional and material ties with his home city and was able to identify the needs for philanthropy from his hometown immediately after the outbreak of COVID-19. Last, as DaXiong had a previous relationship with the alumni associations and the connections he has build overtime with his loyal customers, the inspirational moment came naturally for his philanthropic behavior. From this case study, it is clear that the opportunity recognition theory in social entrepreneurship applies to this specific context of immigrant-owned small businesses.

This research expands the current knowledge on diaspora philanthropy and validates the opportunity recognition theory of social entrepreneurship. Specifically, small businesses are identified as a player in diaspora philanthropy, guilt is identified as motivation in participating in diaspora philanthropy, and immigrant-owned small businesses are able to identify opportunities for participating in social entrepreneurship. However, this research has its limitations, and future research is needed to address the current limitations and expand the body of literature on diaspora philanthropy.

The research has its limitations. First, this is a one-case study. Even though it sheds light on small businesses' roles in diaspora philanthropy, the findings might not be directly generalizable without considering specific contexts. Second, the qualitative data collection method has its limitations. The interviewer–interviewee relationship may potentially cause biases in the information gathered. Both the researcher and the interviewee's personal characteristics may impact how the information is interpreted. Future research can address these limitations by taking quantitative approaches or qualitative approaches with multiple cases. Future research can explore the roles of immigrant-businesses in diaspora philanthropy, regardless of size, as well. Immigrant owners of larger businesses may have different types of involvement with giving back to their home countries. More research is also needed to understand the general phenomenon of diaspora philanthropy in responding to natural disasters, such as COVID-19.

Figures

Role of small businesses as the connector

Figure 1

Role of small businesses as the connector

A list of the eight pieces of news articles used in data

TitleSourceDate
As Coronavirus Panic Spreads, I Went in Search of Wuhan's Defining DishBon Appétit02-06-2020
Wuhan Hot Dry Noodle Stall: Coronavirus Fears Hit Chinese-American BusinessesSouth China Morning Post02-13-2020
De Blasio Visits Flushing as Coronavirus Concerns Continue to Hurt BusinessesPix1102-13-2020
Despite Zero Cases In NYC, Chinese Shops in Manhattan And Queens Suffer Amid Coronavirus ScareGothamist02-13-2020
Queens Businesses, Eateries Suffer Due to Wuhan Coronavirus FearsNBC New York02-14-2020
At This Flushing New World Mall Stall, Wuhan's Hot Dry Noodles Are in High DemandEater New York02-21-2020
Shops in New York City's Chinatown Are Suffering Losses of 50% Because of Coronavirus FearsBusiness Insider03-06-2020
We Went to Chinatown in Queens Last Week and Saw the Future of Restaurants. It Was GrimMother Jones03-18-2020

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Corresponding author

Ximeng Chen can be contacted at: chenx2@sacredheart.edu

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