First, we develop a macro level explanation for how changes in social capital occur. Second, we apply a dynamic approach to social capital by examining on a more micro level the activities which are involved with and contribute to the increase or decrease in social capital in, largely dyadic, relationships within entrepreneurial networks. Third, we propose a more robust notion of social capital. We found that fi ve key relationshipdriving forces were involved in developing social capital. The research fi ndings suggested that entrepreneurs seem to have a strikingly similar modus operandi when it comes to creating and destroying their network social capital. Activities such as the reciprocal trading of favours, socializing, joint problem-solving, delivering to expectation and using transparent communications were crucial to both. Finally, we discovered that entrepreneurs managed their network relationships heuristically relying on social capital, particularly by leveraging the productive ambiguity of this crucial [net]work asset.

PurposeThe paper seeks to use the concept of net social capital to help explain the behaviour of a business constellation, a group of entrepreneurial firms in different businesses that cooperate to their mutual benefit.Design/methodology/approachThe paper takes the form of an in‐depth case study of the Canadian Groupement Quebecoise.FindingsThe members of the group create and maintain net social capital among themselves in a variety of ways both social and economic and in turn use that net social capital outside the group in dealings with other organisations, profit and non‐profit.Practical implicationsThe findings suggest ways in which firms can work with other non‐competing firms.Originality/valueThe concept of net social capital is novel and the study is the first of its kind that investigates such a tightly knit and productive business constellation.