Catalyzing strategies and efficient tie formation: How entrepreneurial firms obtain investment ties
Journal
Academy of Management Journal
Subject
Strategy and Entrepreneurship
Publishing details
Publication Year
2012
Abstract
Although network ties are crucial for firm performance, the strategies by which executives actually form ties are relatively unexplored. In this study, we introduce a new construct, tie formation efficiency, and clarify its importance for superior network outcomes. Building on fieldwork in nine Internet security ventures seeking investment ties, we unexpectedly identify two “equifinal” paths for how executives form ties efficiently. One relies on existing strong direct ties and is only available to privileged firms. The other relies on a second new concept, catalyzing strategies, a means by which executives advantageously shape opportunities and inducements to form ties that is available to many firms. Overall, we add insights to the network and signaling literatures and to the nascent literature on how strategic action, especially by low-power actors such as entrepreneurs, shapes critical network outcomes.
Keywords
Qualitative orientation; Research methods; Network Theory; Theoretical Perspectives; Financing of new ventures (IPOs, venture capital, etc.); Entrepreneurship
Available on ECCH
No
