The Effects of Social Capital and Corporate Entrepreneurship of Venture upon Firm Performance

Abstract

Researches recently made in advanced countries into entrepreneurship found that various resources and information are mainly provided to ventures through social capital, which is a resource capital based on a network, and through corporate entrepreneurship. This research is an exploratory study on the effects of social capital and corporate entrepreneurship of new ventures upon their corporate performance, conducted from the standpoint of dynamic capability. For that purpose, a questionnaire investigation was made of 171 venture entrepreneurs in Korea, and the following is the results of an empirical analysis of responses to the questionnaire. First, it was found that social capital, which is a resource capital based on a network, have a significant effect on corporate entrepreneurship. Second, social capital also have a significant effect on ventures' corporate performance. Third, corporate entrepreneurship have a significant effect on corporate performance except venturing. These results imply that social capital and corporate entrepreneurship have a significant effect on the corporate performance of ventures, which have innate disadvantages concerning the supply of resources. On the other hand, ventures, which encounter relatively more intense demands for change and renovation, can be can be managed in a sustainable manner just when they adequately accumulate their social capital and utilize their external resources and appropriately conduct their corporate entrepreneurship activities.