REsearch On The Influence Mechanism Of Entrepreneurs’ Network Ties On Start-up Business Performance

Entrepreneurial activities can provide jobs, create a positive cultural atmosphere,promote economic growth, maintain social stability, and also can meet consumers’demand, bring wealth, achievement and status for entrepreneurs. Just because of theseadvantages, entrepreneurial activities attract public concern and governments’encouragement. Along with the overall environment improve effectively andopportunities raise increasingly, the concept of nation-wide entrepreneurship hastaken deep roots in the heart of our people, TEA（Total Early-stage EntrepreneurialActivity）rate keep rising, our country has become one of the most dynamic countriesof entrepreneurial activities. However, behind the flourishing of entrepreneurialactivities, the performance of the most entrepreneurial firms is not so optimistic.Because of the high entry barriers and threshold from established firms, at thebeginning of start-up stage, entrepreneurial firms are faced with the “the valley ofdeath”. According to the “Enterprise Long-term Incentive Research Report in China2011” and the “Human Resources Management of SME in China2012”, the averagelifetime of entrepreneurial firms is2.5years.Most of the entrepreneurial firms are facing with a very difficult situation, whilethere are no lacks of successful ones. Summarizes the possible laws of these fewwinners, we find that social networking and technological innovation are important.Unlike the established firms, the start-up business is congenitally deficient, itscreation and accumulation ability are weak, while the demand and the dependency onexternal resources are strong. But the reputation, experience and legitimacy of thestart-up business are all at the lower level, it is hard to get partners’ and resourcesowners’ trust and supports, which means that would be unlikely to get externalresources in this stage by organizational network. At this point, of course, theentrepreneurs’ network is significant, which is the most important channel andopportunity of getting information, technology, capital, knowledge and otherresources. We can say that the entrepreneurs’ network like the baby’s umbilical cordsupply the start-up business nutrients. Meanwhile, on the basis of China’s ruralsociety and difference sequence pattern, the relationship variable plays the role of access, timing and referrals, which is also shorten the distance between start-upbusiness and resources holders. On the other hand, only with the advantage oftechnology, the start-up business can provide different products, services andmarketing channels, which can bresk the original entry barriers, raise customershifting cost and then creat earnings growth.Aside from the integration research of entrepreneurs’ network and organizationalnetwork, in view of the synchrony evolving between the main effect factors ofentrepreneurs’ network characteristics and the evolution process of entrepreneurial,acconding to the logic that the start-up business performance mainlyentrepreneurs-contacts driven, this dissertation tries to focus on the problem of themechanism of entrepreneurs’ network ties forms productive force and promote theperformance. Referred to the previous literatures, this dissertation finds that theentrepreneurs’ network ties may have the direct impact on start-up businessperformance on the one hand, and on the other hand, it may be also have the indirectimpact through technological innovation. In view of this, the dissertation tries to buildthe basic framework of “entrepreneurs’ network ties——technological innovation——start-up business performance”, and also put the environmental uncertainty in theframework in order to test the establishing conditions of it.Based on large sample empirical research and statistical tests on the datacollected, this dissertation acquired the following conclusions. Firstly, entrepreneurs’network ties effectively improve start-up business performance, strong ties and weakties will help entrepreneurs have more chance to get the supporting resources such astrust, fund and information, which can make up the liability of newness. Secondly,technological innovation plays a mediating role between entrepreneurs’ network tiesand start-up business performance. This indicates that the impact of entrepreneurs’`network ties on start-up business performance can be achieved in large part bytechnological innovation. The entrepreneurs’ network ties open a window, throughwihich new ventures can carry out innovative activities such as design newproductions, research and development. And these antivities are the most immediateways to acquire performance. In the aspect of dimensions, the strong ties and weakties of the entrepreneur’s network promote the start-up performance throughexploitative technological innovation and exploratory technological innovationrespectively. This conclusion provides another approach to solve the paradox betweenstrong ties and weak ties, and it also provides the different sources of driving forcesfor technological innovation.Thirdly, environmental uncertainty plays a significant moderate role between technological innovation and start-up business performance.Owing to the deficient resources, it is difficult for the start-up business to have thestrength to get ambidexterity equilibrium, and therefore pursuing punctuatedequilibrium between exploitative and exploratory technological innovation will be therational choice.With the increasing environment dynamic, consumer preferenceschange elusively, the life cycle of products and technology become shorter, all ofthese urged new ventures conduct exploratory activities such as develop new productsand new technology. Owing to the strong competition in the market, especially thecompetition focus on the quality and the price of some products, exploitative activitieswill improve products quality, increase productivity and reduce the cost, those whostill carry out exploratory activities would be sank into the position of spending isgreater than the incoming.In this dissertation, a new research framework is formed which is focus on theinfluence mechanism of entrepreneurs’ network ties on start-up business performance.This not only helps to bridge the research gap of synchrony evolving betweennetwork theory and entrepreneurial process, the conclusions are also of importantreference value for entrepreneurs of targeted use personal relationships in the processof improving new venture performance. For those entrepreneurs, personal networkties are potential tools.However, with the perfection of social norms and legal system,the benefits from the ties are not immediately and directly apparent as those in thepast. At this point, entrepreneurs should pay attention to the technological innovationwhich plays the indirect effect between entrepreneurs’ network ties and performance,check for the external environmental changes, and select the appropriate innovationtarget. Under the circumstance of strong industry competitiveness, it needs muchmore exploitative technological innovation to promote performance. Strengthing theweak ties, the new venture would get more direct supports and in-depth knowledgeand information. While under the dynamic environment, it makes the exploratorytechnological innovation as a major driver force for the performance, entrepreneursshould increase the number of weak ties, in order to get more heterogeneousinformation and redundant resources.