IDEAS home Printed from https://ideas.repec.org/a/kap/sbusec/v46y2016i3d10.1007_s11187-015-9691-8.html
   My bibliography  Save this article

Complementary or compensatory? A contingency perspective on how entrepreneurs’ human and social capital interact in shaping start-up progress

Author

Listed:
  • Thorsten Semrau

    () (University of Cologne)

  • Christian Hopp

    () (RWTH Aachen University)

Abstract

Entrepreneurs can profit from both their human and social capital. However, research on how the two types of capital interact in shaping relevant outcomes has produced inconclusive results. Attempting to explain the inconsistencies in previous findings, we suggest that the relationship between entrepreneurs’ human and social capital is neither fundamentally complementary nor fundamentally compensatory; instead, the nature of this relationship is contingent on the type of support derived from the network. Our analyses, based on 474 solo nascent entrepreneurs from the PSED II, support our reasoning. While we find nascent entrepreneurs’ human capital and their financial social capital to positively interact in shaping start-up progress, we observe a negative interaction between nascent entrepreneurs’ human capital and their informational social capital. Implications for theory and practice are discussed.

Suggested Citation

  • Thorsten Semrau & Christian Hopp, 2016. "Complementary or compensatory? A contingency perspective on how entrepreneurs’ human and social capital interact in shaping start-up progress," Small Business Economics, Springer, vol. 46(3), pages 407-423, March.
  • Handle: RePEc:kap:sbusec:v:46:y:2016:i:3:d:10.1007_s11187-015-9691-8
    DOI: 10.1007/s11187-015-9691-8
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11187-015-9691-8
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Beate Rotefoss & Lars Kolvereid, 2005. "Aspiring, nascent and fledgling entrepreneurs: an investigation of the business start-up process," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 17(2), pages 109-127, March.
    2. Niels Bosma & Mirjam van Praag & Roy Thurik & Gerrit de Wit, 2004. "The Value of Human and Social Capital Investments for the Business Performance of Startups," Small Business Economics, Springer, vol. 23(3), pages 227-236, October.
    3. Elfring, Tom & Hulsink, Willem, 2003. "Networks in Entrepreneurship: The Case of High-Technology Firms," Small Business Economics, Springer, vol. 21(4), pages 409-422, December.
    4. Watson, John, 2007. "Modeling the relationship between networking and firm performance," Journal of Business Venturing, Elsevier, vol. 22(6), pages 852-874, November.
    5. Colombo, Massimo G. & Grilli, Luca, 2010. "On growth drivers of high-tech start-ups: Exploring the role of founders' human capital and venture capital," Journal of Business Venturing, Elsevier, vol. 25(6), pages 610-626, November.
    6. Per Davidsson & Scott Gordon, 2012. "Panel studies of new venture creation: a methods-focused review and suggestions for future research," Small Business Economics, Springer, vol. 39(4), pages 853-876, November.
    7. Holtz-Eakin, Douglas & Joulfaian, David & Rosen, Harvey S, 1994. "Sticking It Out: Entrepreneurial Survival and Liquidity Constraints," Journal of Political Economy, University of Chicago Press, vol. 102(1), pages 53-75, February.
    8. Deniz Ucbasaran & Paul Westhead & Mike Wright, 2008. "Opportunity Identification and Pursuit: Does an Entrepreneur’s Human Capital Matter?," Small Business Economics, Springer, vol. 30(2), pages 153-173, February.
    9. Unger, Jens M. & Rauch, Andreas & Frese, Michael & Rosenbusch, Nina, 2011. "Human capital and entrepreneurial success: A meta-analytical review," Journal of Business Venturing, Elsevier, vol. 26(3), pages 341-358, May.
    10. Bates, Timothy, 2005. "Analysis of young, small firms that have closed: delineating successful from unsuccessful closures," Journal of Business Venturing, Elsevier, vol. 20(3), pages 343-358, May.
    11. Ozgen, Eren & Baron, Robert A., 2007. "Social sources of information in opportunity recognition: Effects of mentors, industry networks, and professional forums," Journal of Business Venturing, Elsevier, vol. 22(2), pages 174-192, March.
    12. Hoang, Ha & Antoncic, Bostjan, 2003. "Network-based research in entrepreneurship: A critical review," Journal of Business Venturing, Elsevier, vol. 18(2), pages 165-187, March.
    13. Batjargal, Bat, 2007. "Internet entrepreneurship: Social capital, human capital, and performance of Internet ventures in China," Research Policy, Elsevier, vol. 36(5), pages 605-618, June.
    14. Deeds, David L. & Hill, Charles W. L., 1996. "Strategic alliances and the rate of new product development: An empirical study of entrepreneurial biotechnology firms," Journal of Business Venturing, Elsevier, vol. 11(1), pages 41-55, January.
    15. Stam, Wouter & Arzlanian, Souren & Elfring, Tom, 2014. "Social capital of entrepreneurs and small firm performance: A meta-analysis of contextual and methodological moderators," Journal of Business Venturing, Elsevier, vol. 29(1), pages 152-173.
    16. Colombo, Massimo G. & Grilli, Luca, 2005. "Founders' human capital and the growth of new technology-based firms: A competence-based view," Research Policy, Elsevier, vol. 34(6), pages 795-816, August.
    17. Dahlqvist, Jonas & Wiklund, Johan, 2012. "Measuring the market newness of new ventures," Journal of Business Venturing, Elsevier, vol. 27(2), pages 185-196.
    18. Marco Gelderen & Roy Thurik & Niels Bosma, 2006. "Success and Risk Factors in the Pre-Startup Phase," Small Business Economics, Springer, vol. 26(4), pages 319-335, May.
    19. Phillip Kim & Howard Aldrich & Lisa Keister, 2006. "Access (Not) Denied: The Impact of Financial, Human, and Cultural Capital on Entrepreneurial Entryin the United States," Small Business Economics, Springer, vol. 27(1), pages 5-22, August.
    20. Dimo Dimov, 2010. "Nascent Entrepreneurs and Venture Emergence: Opportunity Confidence, Human Capital, and Early Planning," Journal of Management Studies, Wiley Blackwell, vol. 47(6), pages 1123-1153, September.
    21. Bhagavatula, Suresh & Elfring, Tom & van Tilburg, Aad & van de Bunt, Gerhard G., 2010. "How social and human capital influence opportunity recognition and resource mobilization in India's handloom industry," Journal of Business Venturing, Elsevier, vol. 25(3), pages 245-260, May.
    22. Elizabeth Chell & Susan Baines, 2000. "Networking, entrepreneurship and microbusiness behaviour," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 12(3), pages 195-215, July.
    23. Kim, Phillip H. & Longest, Kyle C. & Lippmann, Stephen, 2015. "The tortoise versus the hare: Progress and business viability differences between conventional and leisure-based founders," Journal of Business Venturing, Elsevier, vol. 30(2), pages 185-204.
    24. Davidsson, Per & Honig, Benson, 2003. "The role of social and human capital among nascent entrepreneurs," Journal of Business Venturing, Elsevier, vol. 18(3), pages 301-331, May.
    25. Wouter Stam, 2010. "Industry Event Participation and Network Brokerage among Entrepreneurial Ventures," Journal of Management Studies, Wiley Blackwell, vol. 47(4), pages 625-653, June.
    26. Scott Newbert & Erno Tornikoski, 2012. "Supporter networks and network growth: a contingency model of organizational emergence," Small Business Economics, Springer, vol. 39(1), pages 141-159, July.
    27. Birley, Sue, 1985. "The role of networks in the entrepreneurial process," Journal of Business Venturing, Elsevier, vol. 1(1), pages 107-117.
    28. Peter Johnson & Simon Parker & Frits Wijbenga, 2006. "Nascent Entrepreneurship Research: Achievements and Opportunities," Small Business Economics, Springer, vol. 27(1), pages 1-4, August.
    29. Oliver Alexy & Joern Block & Philipp Sandner & Anne Ter Wal, 2012. "Social capital of venture capitalists and start-up funding," Small Business Economics, Springer, vol. 39(4), pages 835-851, November.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sandberg, Susanne & Sui, Sui & Baum, Matthias, 2019. "Effects of prior market experiences and firm-specific resources on developed economy SMEs' export exit from emerging markets: Complementary or compensatory?," Journal of Business Research, Elsevier, vol. 98(C), pages 489-502.
    2. Razmdoost, Kamran & Alinaghian, Leila & Linder, Christian, 2020. "New venture formation: A capability configurational approach," Journal of Business Research, Elsevier, vol. 113(C), pages 290-302.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Klyver, Kim & Steffens, Paul & Lomberg, Carina, 2020. "Having your cake and eating it too? A two-stage model of the impact of employment and parallel job search on hybrid nascent entrepreneurship," Journal of Business Venturing, Elsevier, vol. 35(5).
    2. Kim Klyver & Benson Honig & Paul Steffens, 2018. "Social support timing and persistence in nascent entrepreneurship: exploring when instrumental and emotional support is most effective," Small Business Economics, Springer, vol. 51(3), pages 709-734, October.
    3. Thorsten Semrau & Arndt Werner, 2014. "How Exactly Do Network Relationships Pay Off? The Effects of Network Size and Relationship Quality on Access to Start–Up Resources," Entrepreneurship Theory and Practice, , vol. 38(3), pages 501-525, May.
    4. Honig, Benson & Hopp, Christian, 2019. "Learning orientations and learning dynamics: Understanding heterogeneous approaches and comparative success in nascent entrepreneurship," Journal of Business Research, Elsevier, vol. 94(C), pages 28-41.
    5. Thommie Burström & Jussi Harri & Timothy. L. Wilson, 2018. "Nascent Entrepreneurs Managing in Networks: Equivocality, Multiplexity and Tie Formation," Journal of Enterprising Culture (JEC), World Scientific Publishing Co. Pte. Ltd., vol. 26(01), pages 51-83, March.
    6. Christian Linder & Christian Lechner & Frank Pelzel, 2020. "Many Roads Lead to Rome: How Human, Social, and Financial Capital Are Related to New Venture Survival," Entrepreneurship Theory and Practice, , vol. 44(5), pages 909-932, September.
    7. Nuscheler, Daniela & Engelen, Andreas & Zahra, Shaker A., 2019. "The role of top management teams in transforming technology-based new ventures' product introductions into growth," Journal of Business Venturing, Elsevier, vol. 34(1), pages 122-140.
    8. Masatoshi Kato, 2017. "Founders’ human capital and external knowledge sourcing: An absorptive capacity perspective for innovative start-ups," Discussion Paper Series 162, School of Economics, Kwansei Gakuin University, revised Jun 2017.
    9. Stam, Wouter & Arzlanian, Souren & Elfring, Tom, 2014. "Social capital of entrepreneurs and small firm performance: A meta-analysis of contextual and methodological moderators," Journal of Business Venturing, Elsevier, vol. 29(1), pages 152-173.
    10. Wu Zhao & Jizhen Li & Xiaohua Li & Thomas Schøtt, 2020. "Implications of Network Diversity for Venture Growth: The Mediation Effect of Entrepreneurial Alertness," Sustainability, MDPI, Open Access Journal, vol. 12(22), pages 1-15, November.
    11. Li Zhou & Maris Farquharson & Thomas Wing Yan Man, 2016. "Human Capital of Returnee Entrepreneurs: A Case Study in China," Journal of Enterprising Culture (JEC), World Scientific Publishing Co. Pte. Ltd., vol. 24(04), pages 391-418, December.
    12. Dimo Dimov, 2010. "Nascent Entrepreneurs and Venture Emergence: Opportunity Confidence, Human Capital, and Early Planning," Journal of Management Studies, Wiley Blackwell, vol. 47(6), pages 1123-1153, September.
    13. Kristine M. Kuhn & Tera L. Galloway, 2015. "With a Little Help from My Competitors: Peer Networking among Artisan Entrepreneurs," Entrepreneurship Theory and Practice, , vol. 39(3), pages 571-600, May.
    14. Román, Concepción & Congregado, Emilio & Millán, José María, 2013. "Start-up incentives: Entrepreneurship policy or active labour market programme?," Journal of Business Venturing, Elsevier, vol. 28(1), pages 151-175.
    15. Ishaq Ahmad Dar & Mridula Mishra, 2020. "Dimensional Impact of Social Capital on Financial Performance of SMEs," The Journal of Entrepreneurship, Entrepreneurship Development Institute of India, vol. 29(1), pages 38-52, March.
    16. Erik Lundmark & Anna Krzeminska & Dean A. Shepherd, 2019. "Images of Entrepreneurship: Exploring Root Metaphors and Expanding Upon Them," Entrepreneurship Theory and Practice, , vol. 43(1), pages 138-170, January.
    17. Bernard Dussuc & Sébastien Geindre, 2012. "Capital social, théorie des réseaux sociaux et recherche en PME : une revue de la littérature," Post-Print halshs-00747912, HAL.
    18. Marvel, Matthew R. & Wolfe, Marcus T. & Kuratko, Donald F., 2020. "Escaping the knowledge corridor: How founder human capital and founder coachability impacts product innovation in new ventures," Journal of Business Venturing, Elsevier, vol. 35(6).
    19. Nguyen, Long Thanh & An, Jake & Ngo, Liem Viet & Hau, Le Nguyen, 2020. "Transforming social capital into performance via entrepreneurial orientation," Australasian marketing journal, Elsevier, vol. 28(4), pages 209-217.
    20. Tristan Boyer & Régis Blazy, 2014. "Born to be alive? The survival of innovative and non-innovative French micro-start-ups," Small Business Economics, Springer, vol. 42(4), pages 669-683, April.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:sbusec:v:46:y:2016:i:3:d:10.1007_s11187-015-9691-8. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Springer Nature Abstracting and Indexing). General contact details of provider: http://www.springer.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.