It seems obvious that networking and connections are important for the success of a start-up venture. Indeed, earlier this year I wrote about some research that revealed how many entrepreneurs are looking for the connections of investors as much as they are their money.
The report, called Building Bridges to Innovative Opportunities and published by Wharton, suggests that tech start-ups are increasingly looking for more than just financial support from backers, with a desire for operational help and industry expertise.
It’s clear therefore that connections matter. A new study however underlines just how much this is so, with the suggestion that we can predict the success of a start-up purely by analyzing their networking style.The research team explored the impact different networking styles had on the profitability of particular start-ups. The hypothesis being tested was that the different strategies deployed by entrepreneurs with their networking would have a different impact upon their profits. In particular they wanted to test the balance between risk and safety when networking.
So, for instance, someone that plays it safe will largely network with people that they already know or that are very similar to themselves. People who play a riskier game however will be much more open to talking with anyone and everyone. Of course, research suggests that despite many of us claiming to want to network with different people, most of the time we actually network with those that are just like us.
the researchers suspected that those with the more open strategy would
deliver better results for their business courtesy of having a larger
pool of contacts.The researchers surveyed members of a professional
networking group. The group meet on a weekly basis to share leads and
referrals amongst each other.
The survey asked members about their networking style and how many physical meetings they’d had with fellow group members recently.The results revealed that the more adventurous networkers would interact more frequently with other group members than their more conservative peers. This in turn was found to results in higher revenue.
This causal link was formed after tracking how much money members would make from referrals by fellow group members, so they could directly hone in on the income derived from group networking activities.
“Because the life expectancy of an entrepreneurial venture is likely to be short,” the researchers say, “identifying ways to help entrepreneurs understand how to increase their chances for success is of considerable practical importance.”
The researchers conclude with a note of caution however in that they don’t propose a direct link between ones networking style and additional revenue, but rather that our networking style may have an indirect impact upon our revenue, courtesy of the impact our networking style has on the size of our network.
Of course, a varied network is also beneficial in other ways. For instance, research has shown that a varied social network is incredibly valuable in learning and technological advancement. Having a diverse group of people to tap for advice and expertise also ensured that the skills learned were retained for longer than in groups with fewer such mentors. This ensured that cultural knowledge was more successfully passed down through generations.Original post