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  • Academy of Management Review

Resources and Relationships in Entrepreneurship: An Exchange Theory of the Development and Effects of the Entrepreneur-Investor Relationship

By: Laura Huang and Andrew P. Knight
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Abstract

We develop a theoretical model, grounded in exchange theory, about the process through which relationships between entrepreneurs and investors develop and influence the growth of new ventures. Our theory highlights the multifaceted relationships that entrepreneurs and investors share—comprising both affective and instrumental dimensions—and the bidirectional exchanges of social and financial resources that build these relationships over time. An exchange theory perspective sheds light on the emergence of different patterns of relationship development over time and how different kinds of resource exchange contribute to new venture growth, contingent on the core problems that a venture faces at a given stage of development. We discuss implications of an exchange perspective on resources and relationships in entrepreneurship for theory, research, and practice.

Keywords

Entrepreneurship; Relationships; Business Startups; Business and Shareholder Relations; Theory

Citation

Huang, Laura, and Andrew P. Knight. "Resources and Relationships in Entrepreneurship: An Exchange Theory of the Development and Effects of the Entrepreneur-Investor Relationship." Academy of Management Review 42, no. 1 (January 2017): 80–102.
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About The Author

Laura Huang

Organizational Behavior
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