Firm Performance and the Evolution of Cooperative Interfirm Networks: UK Venture Capital Syndication

Abstract

(2014) Firm performance and the evolution of cooperative interfirm networks: UK venture capital syndication. Strategic Change, 23 (12). pp. 107118., which has been published in final form at

Stochastic Actor-Oriented Models for the Co-Evolution of Networks and Behavior: An Introduction and Tutorial

“…Notably, though these powerful models have been in use for quite some time in the fields of sociology and education, their potential has yet to be fully realized in organizational scholarship. Applications of SAO models for co-evolution of networks and actor attributes in applied organizational settings include research examining the co-evolution of advice and leadership networks and (in)civility (Porath, Gerbasi, & Schorch, 2015), communication networks and perceived stress (Kalish et al, 2015), trust networks and job satisfaction (Agneessens & Wittek, 2008), interfirm networks and governance orientation (Benton, 2016), interfirm collaborative networks and firm performance (Checkley et al, 2014), status networks and peer control attempts (de Klepper et al, 2017), information sharing networks and evidence-based practice (Mercken, Saul, Lemaire, Valente, & Leischow, 2015), friendship networks and unethical behavior (Zuber, 2015) and advice, and friendship and difficult tie networks and psychological safety (Schulte et al, 2012).…”

“…As such, it is a direct test of homophily. It has been used to test hypotheses such as high-performing firms cooperate with other high-performing firms (Checkley, Steglich, Angwin, & Endersby, 2014) or people seek advice from others with similar levels of psychological safety (Schulte et al, 2012). In our example, a significant positive parameter estimate would support Hypothesis 2, stating that people choose each other as friends because of similarity in their levels of turnover intentions.…”

“…When researchers are interested in examining social influence, they should include the average similarity effect ( avSim ) or one of its theoretical variants, which model the tendency of actors to become more similar on the attribute to their alters over time. Examples might include students adjust their discipline to be more similar to their friends over time (de Klepper, Sleebos, van de Bunt, & Agneessens, 2010) or firm performance is contagious (Checkley et al, 2014).…”

“…When researchers are interested in examining how changes in levels of connectivity affect actors’ attributes, they often include the indegree effect ( indeg ) or outdegree effect ( outdeg ), which examines how changes in an actor’s popularity or expansiveness over time influence his level of a given attribute. Examples (Table 1) might include increases in firm connectivity influence firm performance over time (Checkley et al, 2014) or the fewer others a person communicates with, the higher his or her level of stress (Kalish et al, 2015).…”

Venture Capital Networks in Australia: Emerging Structure and Behavioural Implications

“…Previous research on the impact syndication networks have on the VC firm performances and results often shows positive links measured in terms of successful exit of the portfolio companies as well as internal rate of return on investment (Jääskeläinen, 2012;Guo & Jiang, 2013). It has been found that syndication can lead to better return and higher shareholder value (Brander et al, 2002;Lehman, 2006;Hochberg et al, 2007;Baraldi et al, 2012) and the network position of VC firms can also enhance their portfolio performance (Hochberg et al, 2007;Abel & Nisar, 2007;Checkley, Steglich, Angwin, & Endersby, 2014).…”