This paper examines how organizations protect themselves from the negative social and economic consequences associated with the loss of a key member and their social capital. Drawing on the social capital and upper echelons literatures, the author(s) hypothesize that social capital can be institutionalized. The corresponding hypotheses are tested on a sample of 125 venture-backed software firms and the results demonstrate that the institutionalization of a founder-CEO’s social capital leads to better performance for a firm. The results provide a basis for understanding how social mechanisms influence economic organization as well as succession and compensation in a new venture context.
Founder-ceo transitions, venture capital, startups, social capital & entrepreneurial leadership
Fund, Bret R.
"From Founders to Firm: Examining the Retention of Founder-CEO Social Capital in Venture-Backed Firms,"
The Journal of Entrepreneurial Finance:
2, pp. -.
Available at: http://digitalcommons.pepperdine.edu/jef/vol18/iss2/4
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