Have you been served? The impact of university entrepreneurial support on start-ups’ network formation

Abstract

University-based entrepreneurial support organizations devote increasing efforts to create a context and opportunities for interaction among start-up firms. The basic assumption behind these efforts is that networks facilitate access to knowledge and resources and increase the chances of success for start-ups. However, the mechanisms that facilitate the creation of business ties with other members of the same community are yet to be identified and empirically tested. This paper leverages the social network and firm incubator literatures to hypothesize and test mechanisms that create the context and opportunity for business interaction among member firms within one university-based entrepreneurial support organization. The study uses the empirical setting of a large, university based support organization and the sample includes firms with different levels of membership-support. This empirical context allows us to compare different levels of membership-support and identify the dimensions that have greater impacts on a firm’s opportunity to establish ties with other members. The results reveal that geographical proximity, ad-hoc service support including shared space, and a larger community of member and graduate firms to which network ties may be formed increases the chance of connecting with other past or current member firms.