It is what you know : changes in the structure and role of entrepreneur networks in an industry over time

Abstract

Previous research investigating the relationship between social capital and entrepreneurship has generally focused on the entrepreneur's own capacity to work their way into existing networks. There still remains a gap in terms of understanding how networks are created in the first place. This study aims to gain insight into how industry pioneers create and utilize entrepreneurial-supportive social networks. Building on existing work on network theory and industry evolution I explore three questions. First, are there structural differences in the networks of industry pioneers compared to later entrants? Second what role do diverse social networks play for industry entrants and does this role change over time? Third, does the way in which industry pioneers construct and utilize social networks influence the establishment of legitimacy for a new product category? In this mixed-methods study, I find that in the early stages of the U.S. artisan cheese industry, entrepreneurs created and utilized networks mainly for the development of human capital. Diverse networks provided a greater volume of information than tight-knit networks, and were instrumental in the creation of legitimacy for a new product category. As knowledge has become codified later entrants are more likely to create networks that enable growing market share. Gender differences were identified in that women are more likely to influence others through maintaining a high number of quality connections in which information is transferred one-to-one, and men are more likely to monitor and control the flow of information by acting as a connector between groups. Further research is needed to explore the role of gender differences in mentorship relationships in terms of network structure and role as an industry evolves.