Social Capital in the ICT Sector - A Network Perspective on Executive Turnover and Startup Performance

Recently, The Wall Street Journal proclaimed the “War for Internet Talent” among companies in the Information and Communication Technology (ICT) sector. At the same time, talented employees become entrepreneurial and establish their own startups. We aim to provide evidence that startup performance is not based exclusively on access to talent, in the sense of individual human capital, but is also determined by a social capital aspect resulting from their executives’ turnover history. We apply social network analysis (SNA) combined with logistical regression on a large dataset of companies and executives in the ICT sector. Our study contributes to turnover and entrepreneurship in information systems research, as well as to social capital and multilevel systems research. Furthermore, we shed a light on turnover patterns in the ICT sector, contribute to a better understanding of success factors for startups, and provide a practical measure to help identify and differentiate key employees.