The Power of Alumni Networks - Success of Startup Companies Correlates With Online Social Network Structure of Its Founders
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CCI-2010-001.pdf
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Author(s)
Nann, Stefan
Krauss, Jonas
Schober, Michael
Gloor, Peter A.
Fischbach, Kai
Führes, Hauke
Date Issued
February 2009
Publisher
Cambridge, MA; Alfred P. Sloan School of Management; Massachusetts Institute of Technology
Series/Report no.
MIT Sloan School of Management Working Paper;4766-10
MIT Center for Collective Intelligence Working Paper;2010-001
Abstract
In this paper we analyze the success of startups in Germany by looking at the social network
structure of their founders on the German-language business-networking site XING. We address two
related research questions. First we examine university-wide networks, constructing alumni
networks of 12 German universities, with the goal of identifying the most successful founder
networks among the 12 universities. Second, we also look at individual actor network structure, to
find the social network attributes of the most successful founders.
We automatically collected the publicly accessible portion of XING, filtering people by attributes
indicative of their university, and roles as founders, entrepreneurs, and CEOs. We identified 51,976
alumni, out of which 14,854 have entrepreneurship attributes. We also manually evaluated the
financial success of a subsample of 80 entrepreneurs for each university.
We found that universities, which are more central in the German university network, provide a
better environment for students to found more and more successful startups. University networks
whose alumni have a stronger “old-boys-network”, i.e. a larger share of their links with other alumni
of their alma mater, are more successful as founders of startups. On the individual level the same
holds true: the more links founders have with alumni of their university, the more successful their
startup is. Finally, the absolute amount of networking matters, i.e. the more links entrepreneurs
have, and the higher their betweenness in the online network of university alumni, the more
successful they are.
Subjects
startup success
founder networks
online social networks
entrepreneurship
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