This blog contains posts starting in 2008 from students at The Fletcher School at Tufts University, the Leipzig Graduate School of Management, and Hult International Business School. This is an excellent resource for information about all types of social networks, research strategies, and analytic techniques.
Thursday, December 27, 2012
Using SNA to assess the potential success of a angel or venture capital investment
Venture capitalists and business angels often form "alliances" or syndicates to invest in start-up companies.
The goal of the research:
Analyse how a pool of investors is interconnected (social connections and collaborative connections) and identify patterns between the density of the network, closeness of investments (same industry / ...), and success of investments, and does a network of investors with a high density affect companies creations in a specific area?
Furthermore, is a well connected network of a company's investors correlated with successful growth or exits?
This research could also provide a tool to measure one's own distance from an attractive "clique" of investors and thus finding an appropriate way to more easily access capital for startup founders.
Attributes needed:
-Is the person a Business angel or VC?
-# of successful exits the investor made
-# of deals the investor made
-Name of companies invested in
-Target industries
-Region.
For the collaborative connections between investors, ie those that have coinvested in a same company, various databases exist for venture capital companies and individuals that disclose names of the target companies, amounts invested, exits.
For angel investors, there are a lot of country-wide networks that disclose name of the members, but investments are not disclosed. It is therefore needed to survey these investors with a questionnaire.
For the social connections between investors, a rough research could be done over internet social networks such as linkedin and twitter to assess if they are 1.connected (linkedin connections / follower-following) 2.one way or two ways (has "tweeted" but didn't receive a reply ...) which can also be a proxy for the strength of the connection.
It would however be a first step for a more detailed analysis which can only be pursued with questionnaires and extensive research.
Dirk, This is a good start. There are studies of social connections between investors; it would be interesting to examine the qualitative aspects of these connections, as you suggest
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