One of the least understated resource which any budding entrepreneur needs is a personal entrepreneurial network. When I run business startup programmes, the truly lasting resource they gain is a network of like minded people. The skill learnt is to be able to find out a common fact within 60 seconds and engage that person on a entrepreneurial level and is one of the first skills we learn as entrepreneurs.
There are numerous entrepreneurial networks offering different types of resources to start or improve entrepreneurial projects. However when selecting a network what is the criteria you should use to make you decision. Here are seven traits to look for.
Social capital
When we look at social capital with entrepreneurial networks, we see a number of factors which highlight the importance of the network and the development of trust. A number of researchers have underlined the importance of networks and social capital (Aldrich-Zimmer 1986, Burt 1992, Adler-Kwon 2002). There are numerous definitions of social capital, but the most appropriate one is ‘features of social organization such as networks, norms, and social trust that facilitate coordination and cooperation for mutual benefit’ (Putnam 1995, p. 67). What social trust does the network promote?
Collective Self-Efficacy
Collective efficacy refers to a group’s shared belief in its conjoint capabilities to attain their goals and accomplish desired tasks (Bandura, 1986). The network should want to collaborate in collective action to address the problems within the group. This mean the continue mutual benefit should remain through the stages of enterprise development. So how will you get the most out of this network while you grow? What can you provide to the group and what will they provide you?
Social Organization
The network should be organized with rules, routines and opportunities to engage with every member. According to Shane and Venkataraman (2000) the domain of entrepreneurship is a connection between opportunities and enterprising individuals. This connection within the network needs to be organized for it to be effective for you as a member. Look for network which provide these connection opportunities within its social structure.
Entrepreneurial set of norms
The entrepreneurial network has a set of norms which will help define the enterprise development, the business opportunities, the skills and the opportunities for future enhancement of the entrepreneur. What are the set of norms you will need?
- Innovation – Combined with leadership, the entrepreneurial network is an indispensable kind of social network not only necessary to properly run the business or project, but also to differentiate itself.
- Beliefs – Social beliefs are the expectations around which we organize daily social life. They allow us to put order into the world around us through kinship and social values. Does the network fit with your beliefs?
- Behaviors – The behavior traits such as dominance, extrovert, patience and conformity will be held within the group. Does it contain the right mix for your success?
- Routine – In general, entrepreneurs manage the risks around them by developing procedures and routines that enable them to access a suitable solution when a problem arises (Edvinsson and Malone 1999; Roos et al. 2001). If you have a regular access to the group, they can form part of you risk reduction strategy.
Size of Network
The network should have the diversity of people but also be large enough for you to constantly finding new people and opportunities. However your person network should be solid enough for people to know you well enough to interact with and provide and receive opportunities. The critical elements of the network are nodes, (members) and links (relationships) (Gartner 1988, Burt et al. 1994, Lipnack-Stamps 1994). So
- How well do you need to know someone to consider them part of your network?
- How many people can you consider to part of your network?
The network should be at ten times larger than this number. This allows for you be able to develop as a business owner and also find new people to discuss the entrepreneurial mindset.
Diversity of Membership
The importance of a diverse range of members in the network important in being able to quickly gain adequate human resources to fulfill the entrepreneurial achievements. These fit into the following groups.
- Business Services: Lawyers, Accountants, Marketing, Sales
- Co-Founders: Technologists, Scientists, Engineers, Business managers
- Client & Suppliers
- Partners – high skilled employees, mentors, investors
Online Network
The internet provides a faster and more reliable method of connecting and sharing with others. Therefore we see more entrepreneurial networks, both on dedicated sites and also on the main stream social networks such as twitter, Facebook and also Linkedin. Twitter is many groups of people who are dedicated to enterprise providing the information which is needed to start and develop a business. Linkedin has many groups which debate and connections can be developed to share business ideas and opportunities.
Chamber of commerce – http://www.britishchambers.org.uk/
Federation for small business http://www.fsb.org.uk/
Institute of directors – http://www.iod.com/
Enterprise Nation – http://www.enterprisenation.com/
NACUE – http://www.nacue.com/
Shell Livewire http://www.shell-livewire.org/
Sandbox – http://www.sandbox-network.com/