Social Capital and Start-Up Performance: The Role of Customer Capital

Brinja Meiseberg ()
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Brinja Meiseberg: Westfälische Wilhelms-Universität Münster

A chapter in Interfirm Networks, 2015, pp 125-148 from Springer

Abstract: Abstract Research has provided ample evidence for the importance of entrepreneurs’ social capital for venture creation. Scholars have particularly focused on relationships with investors, suppliers, administrative boards, and on interfirm networks. However, anecdotal evidence illustrates that social capital with customers can be most decisive, as obviously, an established customer base instantly generates sales, word-of-mouth, and referrals. Based on longitudinal data from 450 German start-ups in franchised services, I explore the role of social capital with customers for successful start-up. The results document a strong linkage between customer capital and start-up performance. Entrepreneurs’ subsequent efforts for managing customer relationships successfully (concerning retention, cross- and upselling, referrals) moderate the linkage. However, contrary to expectations, performance advantages are rather short-lived. Yet, initial customer capital still pays off in terms of opportunities for faster expansion.

Keywords: Social Capital; Customer Relationship Management; Customer Relationship; Customer Retention; Sales Performance (search for similar items in EconPapers)
Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-319-10184-2_7

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DOI: 10.1007/978-3-319-10184-2_7

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