Social Networks, Funding, and Regional Advantages in Technology Entrepreneurship
36 Pages
Posted: 4 Oct 2015
Last revised: 1 Jun 2016
University of Texas at Austin - Red McCombs School of Business
University of Texas at Austin - Department of Information, Risk and Operations Management
University of Texas at Austin - Red McCombs School of Business
Date Written: August 1, 2015
Abstract
Economic advancement, funding opportunities and social networks influence entrepreneurs when choosing locations for startups. In this study, we extend the literature on regional advantage by empirically analyzing factors that influence an entrepreneur’s startup location choice. Using economic indicators made publicly available by the U.S. government, investment information from CrunchBase, and LinkedIn professional histories and network data, we study regional and personal factors influencing location choice. Entrepreneurs have choices to establish a startup in their current location, a new location, or move to a new location, work as an employee for a short time then create the startup there. From our analysis, we find that funding rounds per year, employment, unemployment rate and GDP play a significant role in influencing location selection. Also, regional social network density and tenure in location significantly influence entrepreneurs when choosing a startup location. Finally, implications for policy development and further research are discussed.
Keywords: Social Networks, Entrepreneurship, Regional Advantage, Startups, Innovation
JEL Classification: M13, D71, D80, O15, O30, O51, R23
Suggested Citation:
Suggested Citation
Butler, John and Garg, Rajiv and Stephens, Bryan, Social Networks, Funding, and Regional Advantages in Technology Entrepreneurship (August 1, 2015). Available at SSRN: https://ssrn.com/abstract=2668918 or http://dx.doi.org/10.2139/ssrn.2668918
