How strong is your social capital? Interactions in a non-transparent entrepreneurial ecosystem

Abstract

PurposeThe purpose of this study is to explore the strength and value-relevance of social capital in an entrepreneurial ecosystem. Entrepreneurial ecosystem (EE) provides a new perspective to explaining the configurations and interactions that shape entrepreneurial outcomes in regions. Research on the nature of interactions in EEs is still an ongoing debate. The authors draw from “organisational fields” studies to critically examine the interactions among actors in a non-transparent EE using the case of the Lagos region.Design/methodology/approachThe methodology is based on a qualitative study of 40 semi-structured interviews with various ecosystem actors in the Lagos region, including financiers, government officials, universities, founders and venture capitalists. Additionally, data from the semi-structured interviews were triangulated with data obtained from a two-day focus group discussion Summit where Lagos’ EE issues were raised. This study analysed both data using thematic analysis.FindingsThis study suggests that in a non-transparent EE, four types of interactions are apparent: collaborative, stratified, clustered and unleveraged. Authors argue that in a non-transparent EE, there are blockages and distortions in the flow of resources to entrepreneurs and a higher proportion of entrepreneurs are unable to plug into the ecosystem to extract value for their businesses without a strong social capital.Practical implicationsThe authors argue that entrepreneurs require deliberate effort to improve structural and relational social capital to plug into their ecosystem to extract value for their businesses.Originality/valueThe focus on interaction in a non-transparent EE is a novel approach to studying interactions within EEs. In addition, the study is an early attempt to explore entrepreneurial interactions within the Lagos region.