Social capital in the capitalisation of new ventures: accessing, lubricating and fitting.
Anderson, Alistair R.
Jack, Sarah L.
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ANDERSON, A.R., JACK, S.L. and DRAKOPOULOU DODD, S. 2009. Social capital in the capitalisation of new ventures: accessing, lubricating and fitting. In Bergmann, M. and Faust, T. (eds.) Handbook of business and finance: multinational companies, venture capital and non-profit organizations. New York: Nova Publishers, pages 293-300.
New venture capitalisation demands the formation of the necessary financial resources to launch. Social capital - the potential resources to which individuals have access due to their position within specific social networks of relationships - also plays a significant role in new venture capitalisation in three main ways. Firstly, social capital provides access, and thus acts a means of securing other forms of capital. Secondly, social capital also lubricates relations between entrepreneur and others within the socio-economic environment, including financiers. Thirdly, social capital acts as a mechanism for fitting the entrepreneur and their new venture to the wider socio-economic environment.