Abstract

Much research has pointed to the importance of building social capital to the new venture gestation process. When employees create their own business after leaving current job, some of the social capitals created by group of individual couldn’t be easily brought into new job (David et al., 2008).

We divided social capital into general social capital, industry-specific social capital and task-specific social capital. General social capital is defined as social networks such as kinship and friends who only has only personal contact, not related with business. It has high mobility which will bring mentality help such as emotion support to entrepreneurs. Industry-specific social capital is the social network that can be applied across the whole industry, such as the networks with suppliers, customers, competitors and other entity organizations, which would decreases the business cost if entrepreneurs create new ventures in the industry which they worked before. Task-specific social capital is the relation with other entrepreneurs and members of founding teams. It would affect the intention of using network for initial capital during the venture gestation process.

We analyze the concentration of start-up behaviors, entrepreneurial exit and the venture gestation duration which might be more likely to lead to successful venture creation at particular times in the start-up process (Liao, Welsch and Tan, 2005). We offer hypotheses that suggest that (1) the mobility of social capital is positively related to a concentration of start-up behaviors. (2) The mobility of social capital is negatively related to the entrepreneurial exit. (3)The mobility of social capital is negatively related to the venture gestation duration.

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