Instructor Resource
Neck, Entrepreneurship
SAGE Publishing, 2018
Lecture Notes
Chapter 14: Developing Networks
Learning Objectives
• Explain the role of networks in building social capital.
• Demonstrate the value of networks for entrepreneurs.
Notable Quote
• “The most important action entrepreneurs and organization founders must take is to
build a network of support for their new venture”
Three Dimensions of Social Capital
• Structural
• Relationship
• Cognitive
Notes:
Social capital can be divided into three dimensions: the structural dimension, the relational
dimension, and the cognitive dimension (see Figure 14.1). The structural dimension describes
the components of your network, such as the type of social ties you may or may not have (i.e.,
Instructor Resource
Neck, Entrepreneurship
SAGE Publishing, 2018
Three Dimensions of Social Capital
• See Figure 14.1: Three Dimensions of Social Capital
Main Varieties of Social Capital
• Bonds: Connections with people who are like us such as family and friends.
• Bridges: Links that go further than simply sharing a sense of identity such as classmates,
Notes:
The Organization for Economic Co-operation and Development (OECD), a global organization
The Value of Networks
• Private information
• Access to diverse skillsets
• Power
Notes:
There are three main advantages to networks: private information, access to diverse skillsets,
and power. Private information is the type of information that is not available to the general
public. Gathering unique information from network contacts, such as the release date of a new
product, or what investors look for during a pitch can give entrepreneurs the edge over the
competition. The value of private information increases when trust is high in the network.
Secondly, networks provide access to diverse skillsets. A highly diverse network of contacts
Instructor Resource
Neck, Entrepreneurship
SAGE Publishing, 2018
Critical Thinking Question
• What are some ways in which you can use your own network to attain your goals?
Career Support
• Sponsorship
• Coaching
Notes:
Psychosocial Support
• Encouragement & emotional support
• Acceptance & confirmation
Role Modeling
• Behavior to emulate
• Work ethic and values
• Inspiration and motivation
Instructor Resource
Neck, Entrepreneurship
SAGE Publishing, 2018
Notes:
Building Networks
• Local events
• Public lectures
• Chambers of Commerce
• Meetup groups
Notes:
Forging connections goes beyond striking up conversations with friends and acquaintances; a
really useful network expands to meeting other individuals in your geographic location. Check
online for public calendars of local events, including public lectures at universities, Chambers of
group in Canada, as well as being one of the top 5 most active groups in the world. Meetup is
becoming so popular that the number of worldwide users has already reached 25 million.
Meetups typically run from one hour to all day, and they can feature formal presentations or
simply be free-form networking events. Many Meetup groups focus on technology (such as the
SaaS consortium) or skills (such as public speaking or podcasting).
There are more formal networking groups solely for the entrepreneur community. For example,
Startup Colorado (startupcolorado.com) is a “regional initiative to increase the breadth and
Instructor Resource
Neck, Entrepreneurship
Top Organizations for Entrepreneurs
Additional Networking Tips
• Discover what you can do for someone else.
• Ask good questions.
• Unveil your passions.
• Read voraciously so you have information to draw on during conversations.
• Follow up with a personal note.
• Prepare a short self-introduction.
Notes:
Social networking sites enable you find and interact with people you might otherwise never
meet who share your passion and could ultimately help build your venture. For example,
selective networking site FounderDating provides a global forum for entrepreneurs to connect
Virtual Networking
• Twitter
• LinkedIn
Instructor Resource
Neck, Entrepreneurship
SAGE Publishing, 2018
• Facebook
Reasons to Use Social Networking
• Build credibility
• Create transparency
• Build trust
Critical Thinking Questions
• What do you think is easier—forging a professional relationship for personal gain or
forming a spontaneous professional contact?
Founding Team
• A founding team is a group of people with complementary skills and a shared sense of
Characteristics of a Great Founding Team
• Industry experience
• Ability to manage complex problems
Instructor Resource
Neck, Entrepreneurship
SAGE Publishing, 2018
believes that founding teams must have the right balance of personalities and characteristics in
order to achieve success. p.149 in
Aldrich, H. E., and Kim, P. H. 2007. Small worlds, infinite possibilities? How social networks
Critical Thinking Question
• How do you think others would categorize you as a member of their networks? What
qualities do you possess that would be valuable to others in their networks?
The Value of Team Diversity
• Not only differences in demographics, but also…
• Career path
Dimensions of Diversity
• See Figure 14.5 Dimensions of Diversity
The Value of Team Diversity
• Homogeneous and heterogeneous teams
Critical Thinking Activity
• Think of an activity (video games, social media, TV, internet surfing) that you could cut
back on to pursue personal growth, seek out professional opportunities, and build
Instructor Resource
Neck, Entrepreneurship
SAGE Publishing, 2018
Six Traits of Healthy Conflict
• Develop multiple alternatives to enrich the level of debate.
• Share commonly agreed-upon goals.