Abstract

Given the importance of network status, this study aims to develop a richer understanding of how industry network characteristics, specifically network density and structural differentiation, influence status of the organizations entering the industry network. I develop a model including the direct and moderating effects of the industry’s network on newcomer’s status and test proposed relationships on a panel data of 410 U.S. venture capital firms (3,616 observations). The findings suggest that newcomers’ status is positively imprinted when the organization enters the industry network at a time when the network is not as dense or structurally differentiated. For newcomers who enter a structurally differentiated network, finding prominent partners in the year of entry may offset the negative effects of “social newness” imposed by structurally differentiated industry networks.

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