Spin-Offs and Social Capital: Contingent Social Networking Towards Growth

This paper focuses on the role of interpersonal and inter-organizational social networks for the growth of spin-offs. We refer to the social capital literature and adopt a contingency perspective in order to develop a conceptual framework that links the different networking strategies to the specific spin-off’s features and patterns of growth. Prior works reveal that networks and networking facilitate spin-offs’ growth and performance. However, it is still unclear what contingencies might condition the value of firms’ network and that one of the entrepreneurs’ social capital, explaining in particular which kinds of relationships are useful for the spin-offs’ growth, and when or how. We contributes to this research stream investigating the interplay between the individual-level social capital embedded in entrepreneurs’ personal ties with the meso-level, which is made up of the inter-organizational networks, both adopted as antecedents of growth. The study is based on an in-depth qualitative study of three spin-offs firms, with the main method of data collection represented by personal semi-structured interviews. Through our multiple-case study analysis, we identify different configurations of growth for spin-offs, highlighting why and to what extent they are related to a specific structural and relational arrangement of the entrepreneur’s and the organization’s social capital. We have gained that the pattern of the spin-off’s growth is affected by the different combinations of coordination mechanisms and the diversity of the organizational attributes, associated with the various interpersonal and inter-organizational relationships configurations, and also with the means through which the resources embedded in the network can be accessed and leveraged. Our results also highlights that spin-off’s network requirements change over time and that some negative effects can be generated by the social networks during the different evolutionary phases of growth. Finally, we present policy and managerial implications drawn from our analysis.