The Effects Of Entrepreneurs' Social Capital On Start Ups' Business Performance

As entrepreneurs' social capital is valuable resource, how to best make use of this social capital to improve start-ups' business performance is of great importance for start-ups' existence and development. Entrepreneurs' social capital can be classified into two classes, i.e., bonding social capital and bridging social capital. Upon this point,the research hereinafter uses empirical research methodology to study the relationship between entrepreneurs' social capital and start-ups' business performance.The research shows that the effectiveness of entrepreneurs' social activity on start-ups' business performance is different from that of institutional bridging experience. Besides, the effectiveness of these two kinds of social capital changes with different factors. The capability of entrepreneurs' social activity on start-ups' business performance is affected by enterprise age and enterprise creativity, while the effects of institutional bridging experience on start-ups' business performance are affected by the Communist party level in start-ups and the business expansion of start-ups. Specifically, the effects of entrepreneurs' social activity on start-ups' business performance are positive and will be strengthened when the enterprise get younger and enterprise creativity get stronger, while the effects of entrepreneurs' institutional bridging experience on start-ups' business performance are negative and would be weakened if Communist party level in start-ups is relatively high or if start-ups had been expanded in past three years.So how can entrepreneurs improve start ups' business performance through the best use of social capital? Frist of all, entrepreneurs should participate in much more social activities. Secondly, entrepreneurs should improve start-ups' creativity to strengthen the positive effects of social activity on start-ups' business performance. Thirdly, entrepreneurs who have institutional bridging experience should adjust their social capital structure to weaken the negative effects of differential pattern between different institutions. Fourthly, entrepreneurs who have institutional bridging experience could set higher organizational level of Communist party in start-ups or expand start-ups in right time, so the negative effects of entrepreneurs' institutional bridging social capital on start-ups' business performance could be weakened.