Startup Founders and Their LinkedIn Connections: Are Well-Connected Entrepreneurs More Successful?

• In Event: Social Media, Markets, and Work

Abstract

For the past 40 years, entrepreneurs and researchers have assumed that entrepreneur networks are important and beneficial for startup ventures. Research has shown that startup ventures benefit from entrepreneur networks in various ways ranging from establishing credibility in the market, accessing competitive information and opportunities, to accessing skilled people and establishing competitive collaborations. This study takes this notion further by testing whether these benefits actually translate into tangible financial outcomes for a startup. For this purpose, the study integrates two extensive databases that have not been studied together in previous research: Crunchbase.com, which provides extensive information on the financial success of startup companies, and LinkedIn, which provides extensive social network information of founders. The analysis revealed that several variables in LinkedIn profiles were positively correlated with the amount of funds raised by startup companies establishing a link between social networks and entrepreneurial success.

Authors

• Devika Banerji, Purdue U

• Torsten Reimer, Purdue University