networking among high-potential female entrepreneurs - an empirical study in india and germany
DESCRIPTION
This thesis analyzes and compares the business discussion networks of high-potential female entrepreneurs in India and Germany and examines their networking activities and behavior. The framework is this of entrepreneurship research with a network perspective. Also, the framework considers a gender-sensitive approach. Within a mixed-method, stated hypotheses derived from social network analysis were tested with the samples and comparisons between them drawn. Within qualitative interviews, network behavior and networking activities of the female entrepreneurs were investigated. The most important findings of the quantitative part were that the only significant difference between the Indian and German sample is a slight difference in the size of the networks, otherwise, average network structures were similar. The qualitative part made three important categories of developing new contacts visible: Networking through personal references, organizations, events and “cold” contacting. In addition, barriers to networking were accumulated and strategies to overcome those barriers revealed. Start-up hubs such as cities like Berlin and Bangalore play a crucial role for this particular group of entrepreneurs.TRANSCRIPT
Zeppelin University
Department Corporate Management & Economics
Leadership Excellence Institute Zeppelin | LEIZ
Nair Rajendran, Murali
In Cooperation with
Indian Institute of Management Bangalore
N S Raghavan Centre for Entrepreneurial Learning
Prof. Suresh Bhagavatula
Masterthesis
Networking among High-potential Female Entrepreneurs
An Empirical Study in India and Germany
Nicole Jackisch
Matriculation number: 1120046
Corporate Management & Economics
Date: 20.06.2014
Abstract English
This thesis analyzes and compares the business discussion networks of high-potential female
entrepreneurs in India and Germany and examines their networking activities and behavior. The
framework is this of entrepreneurship research with a network perspective. Also, the framework
considers a gender-sensitive approach. Within a mixed-method, stated hypotheses derived from social
network analysis were tested with the samples and comparisons between them drawn. Within
qualitative interviews, network behavior and networking activities of the female entrepreneurs were
investigated. The most important findings of the quantitative part were that the only significant difference
between the Indian and German sample is a slight difference in the size of the networks, otherwise,
average network structures were similar. The qualitative part made three important categories of
developing new contacts visible: Networking through personal references, organizations, events and
“cold” contacting. In addition, barriers to networking were accumulated and strategies to overcome
those barriers revealed. Start-up hubs such as cities like Berlin and Bangalore play a crucial role for
this particular group of entrepreneurs.
Keywords: High-potential Female Entrepreneurs, Women Entrepreneurship, Social Network Analysis, Ego-
centered Networks; India, Germany, Start-up, Social Network Perspective
Abstract German
In dieser Masterthese werden die “Business Discussion Netzwerke” von sogenannten High-potential
female Entrepreneurs in Indien und Deutschland untersucht und miteinander verglichen. Außerdem
wird die Frage beantwortet, wie sie ihre Netzwerkaktivitäten gestalten. Der wissenschaftliche Rahmen
berücksichtigt einen Gender-sensitiven Ansatz. In einem „Mixed-Method Design“ werden Hypothesen
gebildet, abgeleitet aus der Sozialen Netzwerkanalyse, um die Netzwerke der Stichproben aus Indien
und Deutschland zu verglichen. Innerhalb qualitativer Interviews werden Netzwerkaktivitäten der
Frauen genauer untersucht. Die wichtigsten Ergebnisse sind, dass außer einem kleinen, aber
signifikanten Unterschied in der Größe der Netzwerke, keine Unterschiedlichkeiten bezüglich der
Netzwerkvariablen aufzufinden sind. Bezogen darauf, wie die Unternehmerinnen neue Kontakte
herstellen, werden im qualitativen Teil drei wichtige Kategorien aufgezeigt: Netzwerken durch
persönliche Referenzen, durch Organisationen und Events, sowie „kaltes“ Netzwerken. Außerdem
wurden Netzwerkbarrieren identifiziert und aufgezeigt, mit welchen Strategien Unternehmerinnen diese
überwinden. Start-up Cluster wie Berlin und Bangalore spielen außerdem eine große Rolle für High-
potential female Entrepreneurs.
Keywords: High-potential Female Entrepreneurs, weibliches Entrepreneurship, weibliches Unternehmertum,
Soziale Netzwerkanalyse Ego-zentrierte Netzwerke, Indien, Deutschland, Start-up, Soziale
Netzwerkperspektive
Table of Contents
1 Introduction ....................................................................................................... 1
1.1 Problem Statement: Conditions for High-potential Female Entrepreneurs . 1
1.2 Research Objectives ................................................................................... 3
1.3 Relevance of this Study .............................................................................. 4
1.4 Thesis Structure .......................................................................................... 4
2 Framework Development and Literature Review .............................................. 5
2.1 Entrepreneurship Research ........................................................................ 5
2.1.1 Entrepreneurship Research in Context: India and Germany ................ 6
2.1.2 Entrepreneurship Research in Context: Gender .................................. 8
2.2 The Network Perspective in Entrepreneurship - Hypotheses’ Development
11
2.2.1 The Business Discussion Network ..................................................... 11
2.2.2 What Kind of Network is Useful? ........................................................ 12
2.2.3 A Network’s Structural Characteristics ............................................... 12
2.2.4 A Network’s Relational Characteristics ............................................... 14
3 Methodology and Research Design ................................................................ 16
3.1 Social Network Analysis ............................................................................ 16
3.2 Data Collection ......................................................................................... 17
3.3 Measures .................................................................................................. 17
3.4 Data Analysis ............................................................................................ 20
4 Findings .......................................................................................................... 21
4.1 Findings of the Quantitative Part ............................................................... 21
4.1.1 Sample Characteristics ...................................................................... 21
4.1.2 Results by Hypotheses ....................................................................... 28
4.1.3 Summary of the Quantitative Part ...................................................... 33
4.2 Findings of the Qualitative Part ................................................................. 34
4.2.1 Characteristics of Network Relations .................................................. 34
4.2.2 Maintaining and Developing Contacts ................................................ 37
4.2.3 Networking Constrains ....................................................................... 42
4.2.4 Summary of the Qualitative Part......................................................... 48
5 Discussion and Conclusion ............................................................................. 49
5.1 Limitations and Concluding Remarks ....................................................... 54
References............................................................................................................. VI
6 Appendix ....................................................................................................... XVI
Ehrenwörtliche Erklärung ..................................................................................... XIX
Tables
Table 1: Comparing Economy and Demographics of India and Germany ............... 2
Table 2: Sample Characteristics of Indian and German High-potential Women
Entrepreneurs ........................................................................................................ 24
Table 3: Demographics of Indian and German High-potential Women Entrepreneurs
............................................................................................................................... 25
Table 4: Correlations between Entrepreneur’s Work Experience and Network
Variables ................................................................................................................ 25
Table 5: Business Characteristics of Indian and German High-potential Women
Entrepreneurs ........................................................................................................ 26
Table 6: Characteristics of Alteri in Ego’s Core Business Network ........................ 27
Table 7: Network Variables of High-potential Female Entrepreneurs from Germany
and India ................................................................................................................ 28
Table 8: T-test for Independent Samples for Network Size .................................... 32
Table 9: T-test for Independent Samples for Proportion of Family Members ......... 32
Table 10: Characteristics of the Ties between Ego and its Alteri ........................... 34
Table 11: Characteristics of the Ties between Ego and its Alteri ........................... 36
Table of figures
Figure 1: Team Constellation in Terms of Gender in Germany .............................. 22
Figure 2: Team Constellation in Terms of Gender in India ..................................... 22
Figure 3: Ego-Network of a high-potential female with a low density (0.28) ........... 29
Figure 4: Ego-Network of a high-potential female with a moderate density (0.57) . 29
Figure 5: Ego-Network of a high-potential female with a high density (0.91) ......... 30
Figure 6: Entrepreneurs Maintaining Contacts in Hours per Month ....................... 35
Figure 7: Entrepreneurs Developing Contacts in Hours per Month ........................ 36
1
1 Introduction
Apart from the obvious – that entrepreneurship contributes to the economy - it more
than that has a remarkable impact on society. The following definition of
entrepreneurship reflects that:
„Entrepreneurship can be defined as the process of creating
value for business and social communities by bringing together
unique combinations of public and private resources to exploit
economic, social or cultural opportunities in an environment of
change.“ (Fillis & Rentschler, 2010, p. 50)
Therefore, becoming an entrepreneur should be accessible for a wide variety of a
nation’s population. Unfortunately, participation in entrepreneurship shows a gender
gap worldwide e.g. (Delmar & Davidsson, 2000; Minniti, Arenius, & Langowitz, 2005;
Davis & Shaver, 2012). The Global Entrepreneurship Monitor (GEM) established a
special report on female entrepreneurs and compares women’s entrepreneurship in
various regions. The report shows that the gender gap varies highly between
countries; especially mid-Asia shows significant disparities for example in Pakistan,
only 1 % of the female population is engaged in entrepreneurship (Kelley, Brush,
Greene, & Litowski, 2013). In this thesis a comparison between Indian and German
entrepreneurs with regards to their business discussion networks will be drawn - with
a focus on a specific kind of sub-sample: high-potential female entrepreneurs. This
group is defined as “women who own and operate businesses that are innovative,
market expanding and export oriented” (Global Entrepreneurship and Development
Institute, 2014, pp. 8–15).
1.1 Problem Statement: Conditions for High-potential Female Entrepreneurs
In the 2014 report The Gender Global Entrepreneurship and Development Index
(Global Entrepreneurship and Development Institute, 2014, pp. 8–15) 30 countries
were ranked according to their conditions to foster high potential female
entrepreneurship in the groups: (1) Entrepreneurial Environment; (2) Entrepreneurial
Eco-System and (3) Entrepreneurial Aspirations. Germany ranked 4-5th while India
2
only ranked 26th. The highest rated countries were those with a highly developed
economy, while the authors describe those countries that scored last – among them
India – as „culturally conservative emerging economies that adhere to traditional
women’s roles in society“(Global Entrepreneurship and Development Institute, 2014,
p. 15).
In Table 1 a comparison between German and Indian economic data, demographics
and perceptions towards female economic activity is given. Among many
differences, a high percentage of female self-employment in the informal sector of
India (98%) is striking, which explains the high amount of research concentrating on
this sector e.g. (Datta & Gailey, 2012; Kantor, 2002), resulting in a lack of research
for high-potential female entrepreneurs at the same time.
Table 1: Comparing Economy and Demographics of India and Germany
Economy and Demographics India Germany
GDP per capita PPP (constant 2005 intl $) $3.223 $34.573
Adolescent fertility rate (in percent) 77 7
Mean female marriage age 20 32
CEDAW ratification (5 point scale) 2/5 4/5
Mobile Phone Gender Gap 37 No gap
Percent of female self-employment that is informal 98 No Data
Percent of population involved in Entrepreneurship Startups 14 5
Perceptions
Percent of women/men that disagree that “Men make better
business executives than women” 45/ 32 90 / 76
Do women have equal access to leadership positions (1-7 scale) 4/7 4/7
(The Gender Global Entrepreneurship and Development Index, 2013)
3
In line with research on entrepreneurship that underlines the importance of networks
(e.g. Aldrich & Zimmer, 1986; Birley, 1986; Elfring & Hulsink, 2007) the GEDI also
examined the factor “networking”. Within a range 0 to 100 points, the countries were
evaluated. The points were aggregated by the two variables (1) if the entrepreneurs
knew other entrepreneurs and (2) their access to Internet & networks. Germany
scored .66 out of hundred possible points while India ranked .18 - the lowest on the
category (The Gender Global Entrepreneurship and Development Index, 2013,
p. 58). What is unsatisfactory is the oversimplified approach of only considering
those two factors. What should be further investigated is the entrepreneurs’ network
activities and their embeddedness in social networks within a social network
perspective as this would give a more holistic view. Unfortunately, this is completely
missing in the report. This gap will be addressed by this work as stated later in the
research objectives.
1.2 Research Objectives
The gender GEDI index made a huge contribution to research in women
entrepreneurship, as it accounts various factors and contributes to the scarce data
situation on worldwide high-potential women entrepreneurship. Still, many results
need explanation and reasoning. As shown, some factors are from social nature,
therefore a social network approach to get insights to the how’s and why’s is
appropriate.
Building on the above, this thesis contributes to answer the questions:
- How do high-potential female entrepreneurs in India and Germany network?
- How are their networks constituted?
- Are there differences between the German and the Indian sub-samples? If
there are, what are the reasons?
4
1.3 Relevance of this Study
This thesis will contribute to research in at least two ways. First, women
entrepreneurship is generally an under researched topic (Brush, Bruin, & Welter,
2009). Especially taking gender concepts into account, addressing women
entrepreneurship in research will also help reducing the gender gap. Additionally,
most entrepreneurship data is based on samples of men (Bruin, Brush, & Welter,
2006). Therefore, entrepreneurship theory undergoes a bias, as it is not considering
half of the world’s population.
Second, entrepreneurship as well as female entrepreneurship lacks cross-country
comparisons that would allow for a more global approach. The same bias is found
in entrepreneurship literature that mostly derives its theory of entrepreneurship from
western cultures.
1.4 Thesis Structure
In chapter 2, Framework Development and Literature Review, a brief introduction to
entrepreneurship research is given, followed by an overview of the two research
contexts with a focus: (1) on (female) entrepreneurship in India and Germany and
(2) on entrepreneurship research and gender. The discussion of those contexts
gives further implications for the research design of the present paper. Within
Chapter 2.2 The Network Perspective in Entrepreneurship - Hypotheses’
Development, the state of past and current research on entrepreneurship with a
social network perspective is presented. Relevant terms of social network theory will
be explained to the reader and in a second step, hypotheses will be developed.
Those will be based on previous research in entrepreneurship with a network
perspective and the contexts of high-potential female entrepreneur in India and
Germany. After the methodology is explained in Chapter 3, the findings of the
hypotheses testing and the exploratory part based on interviews will be presented in
Chapter 4, to be discussed in Chapter 5. In this last chapter, indications for further
research and policy makers will be stated and limitations will be pointed out.
5
2 Framework Development and Literature Review
2.1 Entrepreneurship Research
In the history of entrepreneurship studies, a line of research concentrating on the
individual entrepreneur – her traits, her behavior and aspirations – was prevailing for
a long time. Peter Schumpeter’s work is still the most citied in entrepreneurial
literature. Schumpeter describes the entrepreneur as a special person with an
outstanding personality and a particular kind of motivation (Schumpeter, 2006,
p. 131). Ahl criticizes that from this historical view “the emerging image is that of the
heroic self-made man” (Ahl, 2006, p. 599). Research in line with the individualistic
approach dealt with entrepreneurial traits, motivations and ambitions (e.g. Llewelyn
& Wilson, 2003; Rauch & Frese, 2007).
Until today, a crucial part for the definition of entrepreneurship is the discovery and
exploitation of entrepreneurial opportunities (Ozgen & Baron, 2007; Shane &
Venkataraman, 2000). Over time, it was realized that opportunities and the access
to resources to exploit those opportunities do not lie solely in the entrepreneur herself
– but that contexts such as social, societal and institutional determine the
entrepreneurial process (Welter, 2011, p. 165).
A shift towards entrepreneurship research that considered those contexts emerged;
especially the focus on the entrepreneurs’ embeddedness in social networks –
known as the Social Network Perspective delivered fruitful insights. Before digging
deeper into social networks, this thesis’ framework will be build successive by
considering (1) the state of research in the field of entrepreneurship research in
developed (Germany) and less developed/emerging countries (India); (2)
implications of gender theory in the field of entrepreneurship research, (3) a brief
overview of the situation of women entrepreneurs in each country and lastly (4)
building the hypotheses from literature of entrepreneurship with a network
perspective.
6
2.1.1 Entrepreneurship Research in Context: India and Germany
As mentioned above, when investigating in entrepreneurship research, contexts
should be considered. Smallbone advices to embed research in “wider political,
economic and social contexts” (Smallbone, Welter, & Ateljevic, 2014). This part looks
at the contexts of Germany and India. First, the state of entrepreneurship research
in developed versus emerging/undeveloped countries will be outlined and second,
the context of particular interest for German and Indian high-potential female
entrepreneurs will be delivered.
Most literature on entrepreneurship concentrated on developed markets (Smallbone
et al., 2014) – meaning that entrepreneurial theories are more valid for western
economies. Accordingly, cross-country studies should be favored. Studies on
entrepreneurship focusing on India are limited (Bruton, Ahlstrom, & Obloj, 2008, p. 2)
– in spite of India’s growing economy (Gupta et al., 2014, p. 369). Although, Das
(Das & Das, 2014) affirmed an increase in literature after a call for papers in 2008
and Hughes et al. (Hughes, Jennings, Brush, Carter, & Welter, 2012, p. 436)
predicted growing literature on women entrepreneurship in India. Gupta, for example
(Gupta, Turban, Wasti, S. Arzu, & Sikdar, 2009) used a three-country sample
including India, USA and Turkey investigating in gender stereotypes and
entrepreneurial intentions. Surprisingly, they could not find any significant
differences (Gupta et al., 2009, p. 405). Vita et al. did a literature review
concentrating on women entrepreneurs in developing countries. Papers recognized
a slowly emerging “new profile of women entrepreneurs: more motivated, well-
educated and free from family ties” (Vita, Mari, & Poggesi, 2013, p. 456). Here, the
importance for research on high-potential women entrepreneurs becomes clear. Vita
et al. organized the review into regional sub-clusters: (1) Sub-Saharan, (2) Africa,
(3) East Asia and Pacific, (4) Europe and Central Asia, (5) South Asia, (6) Latin
America and Caribbean and (7) Middle East. The paper clustered India into the
South Asian region. Comparing to the other countries like Bangladesh or Indonesia,
India has been the most studied. Research focuses on non-profit, micro-enterprises,
7
reflecting India’s female entrepreneurial population. Again, this shows that there is
definitely a lack of research on high-potential female entrepreneurs,
Within the emerging literature on women entrepreneurs in India, the “traditional form”
of entrepreneurial research – concentrating on the individual, – was mainly pursued.
This is comprehensible regarding the young research field. Despite of the legitimacy
of basic research, advanced research designs and questions should be considered
when investigating Indian women entrepreneurs, especially focusing on relational
dimensions as emphasized by Vita (2013). For the study at hand, that implies to test
traditional hypotheses with our sample, as well as asking questions that go beyond
the line of descriptive research and use explanatory approaches.
2.1.1.1 Women entrepreneurs in India
As mentioned above, 95% of Indian women entrepreneurs work in the informal
sector, mostly in rural areas. Even though Vita constitutes an emergence of “high-
potential female entrepreneurs (Vita et al., 2013, p. 456) that are educated, growth
orientated and probably less restricted by traditional role models, there is not much
data on those kind of women. Therefore, we have to concentrate of general
assumptions of conditions for female entrepreneurs to develop hypotheses.
Pandian looked at success factors and problems faced by women entrepreneurs in
the Indian state Tamilnadu. He found out main challenges are receiving a bank loan
from the government, lack of education, lack of self-confidence, gender
discrimination in the society and combining family and work life (Pandian, S. P.
Karuppasamy & Jesurajan, S. Vargheese Antony, 2011, p. 917). In India, mobility
for women is constrained because of security issues and the traditional role models
of women. Women are confronted with family duties, for example approval of the
husband to follow economic activities; caring for family members such as children
and in-laws (Kumari & Deshpande, 2012, p. 16). From this it can be assumed, that
Indian women entrepreneurs work in more closed networks with family members
and close friends.
8
2.1.1.2 Women Entrepreneurs in Germany
The percentage of female entrepreneurs in Germany is increasing. The organization
“bundesweite gründerinnenagentur” involved in fostering women entrepreneurship
in Germany, gave out several reports on women entrepreneurs. The following
statements are based on several reports (bga bundesweite gründerinnenagentur,
2007, 2013a, 2013b).
In German society, still traditional role models are in place. Females are responsible
for childcare and household, therefore they face a double responsibility balancing
professional and family life. 66 % of Germans female entrepreneurs work part-time,
explained by those familial responsibilities. Personal support, especially from the
spouse or partner is crucial, but approval not necessary. Looking at perceived
barriers for female entrepreneurs, personal fear of failure, lack of social security and
a lack of finance comes into the picture. Germans with a higher level of education
have a higher propensity to become an entrepreneur. Mobility is no problem for
German females, as it is safe for women travelling alone and it is a common sight to
see female professionals.
Before investigating in the network perspective of entrepreneurship - a look at a
gender perspective will be taken. This will help to understand the underling
framework and what needs to be considered when investigating in a “gendered”
topic. This also has indications for the research design of this study.
2.1.2 Entrepreneurship Research in Context: Gender
Why is it important to have a look at gender theory when investigating in women
entrepreneurship? It has been the critiques of Ahl (2006) and fellow researchers
which brought to the table the negative effects of traditional research without a
framework on gender – or at least some considerations. In the article Why Research
on Women Entrepreneurs Needs New Directions (Ahl, 2006), the author describe
certain discursive practices in women entrepreneurship research, e.g.:
9
1. The entrepreneur as male gendered
2. Theorizing entrepreneurship as a function in the economy
3. The popular assumption that men and women are essentially different
The first practice, the entrepreneur with a male connotation; shows itself in various
ways. Ahl examined historical (Schumpeter) and recent entrepreneurship literature.
In Schumpeter’s reflections she found that, his descriptions of an entrepreneur are
explicitly male connoted for example as “a man of daring and decisiveness” (Ahl,
2006, p. 599). More subtle, but still existent in recent literature, she found the wording
used to describe an entrepreneur resembles Bem’s Index of masculinity (Bem Lipsitz
& Sandra Lipsitz, 1081).
Using performance measures as the only dependent variable results out of the
second assumption, to consider economic growth as the only qualification for the
existence of entrepreneurship – puts aside other aspects of it, for example tackling
social problems with social entrepreneurship (Braun & French), its contribution to
equality of opportunities, e.g. for people with disadvantages, facilitation and
preservation of local culture and regional development (Spilling, 1991).
Ahl’s third mentioned practice leads to research that concentrates on investigating
differences between male and female entrepreneurs by drawing comparisons
between the groups. „Contrary to hypotheses, few (if any) differences were
found“(Ahl, 2006, p. 604). However, research and publicizing practice prefer results
of difference to non-difference, so comparative approaches prevail. For example,
differences in productivity, success and growth are constantly mentioned (here
again, the second discursive practice shows its power). However, those studies did
not control for firm size, sector and capital intensity; which in contrary would make
those differences disappear (Worldbank, p.25; Hallward-Dreimeier 2013).
The overall effect of this kind of research is “that women are cast as “the other” of
men. They are cast as secondary, as a complement or, at best, as an unused
resource (Ahl, 2006, p. 604). „Rather, gender subordination occurs when women are
presumed to be different (weaker); that these weaknesses are axiomatically
10
exhibited within entrepreneurship and so require special fixing. Such assumptions
are clear articulations of gendered disadvantage which must be recognized in future
research“ (Marlow, 2013, p. 12). A year after Ahl’s publication The Entrepreneurship
Theory and Practice gave out a special issue dedicated to women's
entrepreneurship. During compiling this special issue, the publishers also
encountered methodological concerns. Only a few papers used more than one
nation in their sample, therefore, they suggest doing more cross-country studies in
the future (Bruin et al., 2007).
Following Ahl’s critique of the practice to compare women and men, they suggest
“comparisons between samples of women” (Bruin et al., 2007, pp. 328–329). This
would also improve the data situation, as past research only considered samples of
men (Bruin et al., 2006). This goes in line with the call for cross-country studies
between developed and developing countries (Marković, 2007, p. 326) as outlined
in chapter 2.1.1 Entrepreneurship Research in Context: India and Germany.
In order to create a viable research design that takes the stated concerns with
regards to female entrepreneurship research into consideration, I have included
Ahl’s and Hughes’ recommendations and designed the following research setup,
which:
1. Addresses the problem on a social level (network perspective), rather than
using an individualistic approach on entrepreneurship
2. Uses exploratory rather than only descriptive approaches
by a mixed-method
3. Compares two nations in a cross-country study (India and Germany)
4. Compares samples of women instead of comparing male and female samples
Throughout the above chapters, it was indicated that the approach of a social
network analysis is adequate to answer the research questions. The following
chapter sheds light on the embeddedness of entrepreneurs in social networks.
11
2.2 The Network Perspective in Entrepreneurship - Hypotheses’
Development
Aldrich and Zimmerman were one of the first researchers putting a network
perspective to entrepreneurship research. Their well-cited article “Entrepreneurship
through Social Networks” (Aldrich & Zimmer, 1998) criticized the personality
approach popular in the previous discourse.
„The approach we take, by contrast, focuses on
entrepreneurship as embedded in a social context, channeled
and facilitated or constrained and inhibited by people's positions
in social networks.“ (Aldrich & Zimmer, 1998, p. 4)
„Traditional approaches to research on entrepreneurship neglect
the relational nature of the process“ (Aldrich & Zimmer, 1998,
p. 4)
The idea that entrepreneurship is embedded in networks (Birley & MacMillan, 1997;
Hansen, 1995; Larson, 1992; Reynolds, 1991) caused a shift towards relational
perspectives in entrepreneurship literature and parallel to developments of social
network theories and methods made the topic popular e.g. (Davidsson & Honig,
2003; Dyer & Singh, 1998; Hoang & Antoncic, 2003; Zaheer & McEvily, 1999). A
great quantity of empirical evidence can be found that states how important social
ties are for young companies (Brüderl & Preisendörfer, 1998, p. 213). The reason is
that through social networks the entrepreneur gets access to valuable resources
such as information, capital or opportunities (Singh, Hills, Lumpkin, & Hybels, 1999).
Those resources acquired through relations are called social capital. It is defined as
“recent and potential resources within a steady net of more or less institutionalized
relations” (Bourdieu, 1983, p. 191).
2.2.1 The Business Discussion Network
A person’s networks “reflects distinct forms of social capital” (Reagans & Zuckerman,
2001, p. 503). In terms of social network theory, a network consists of nodes and
ties. A node represents a person and a tie the relationship between two nodes. In
12
this study a sub-set network is examined, that gives the entrepreneur access to
valuable resources: the business discussion network. It is defined as the network the
entrepreneur turns to for discussing her business or get advice (Renzulli, Aldrich, &
Moody, 2000). It is called ego-centric, because its focus lays on one individual and
her distinct ties. This approach is particularly adequate for investigating in young
start-ups, as in the early phase of a firm; ego-centric networks reflect the personal
networks of the founders (Hite & Hesterly, 2001, p. 282).
One way to look at the network’s features is to distinguish between relational and
structural attributes. The relational nature of the network looks at how the ties are
constituted e.g. shown in the concept of strong and weak ties (Granovetter, 1973).
The structural quality of a network looks at the structure produced by the various
connections of ties and leads to certain compositions, e.g. is a network dense,
meaning the members know each other; do some members have special positions
e.g. as a gatekeeper etc. (Wasserman & Faust, 1994)
2.2.2 What Kind of Network is Useful?
In entrepreneurship literature with a network perspective, various kinds of network
settings are said to be favorable for an entrepreneur. Organizing the review into
relational and structural embeddedness seems convenient, but it has to be kept in
mind that concepts are interdependent, for example the positive relation between
network size and number of weak ties. In the following, the most important studies
in the field will be presented, based on reviews done by (Hoang & Antoncic, 2003,),
(Slotte-Kock & Coviello, 2010) and (Martinez & Aldrich, 2011).
2.2.3 A Network’s Structural Characteristics
First research concentrating on basic structural characteristics, found out that the
size of a network is important. (Aldrich & Zimmer, 1986). From particular interest for
this study is the result that the discussion network sizes and the time in maintaining
and developing contacts is different between countries (Greve & Salaff, 2003, p. 7).
As India’s women are even more connected to families, it is assumed their networks
13
consist of more familial relations; as this network is limited, it is assumed that their
discussion networks are smaller in size:
Hypothesis 1:
Network size is bigger in high-potential female entrepreneurs
from Germany than from India.
Entrepreneurship scholars also dealt with the density of a network. A dense network
is important for startups as the information flows easily (Bhagavatula, 2009, p. 53).
Density is also said to be higher in networks with a huge amount of strong ties,
therefore we can hypothesize that:
Hypothesis 2:
Network density is higher in high-potential female entrepreneurs
from India than from Germany.
The position of an entrepreneur within the network is also supposed to influence
resource flow (Hoang & Antoncic, 2003, p. 170). A related concept is that of
structural holes, defined as “a gap between two individuals with complementary
resources or information” (Burt, 1992, p. 685). The entrepreneur can profit from
bridging that gap by getting access to new information, new opportunities and
possessing a control position (Burt, 2004). One measure Burt uses in this line of
thinking is that of the “network constraint”. It measures how constrained the ego is
by the structure of his network. If the network constraint is high, it means there are
not many structural holes in ego’s network. In a dense network, the possibility of
structural holes is less. If Indian entrepreneur’s networks show a higher density, then
it can be assumed that structural holes are less.
Hypothesis 3:
Indian high-potential female entrepreneurs’ networks have a
higher network constraint than those of German high-potential
female entrepreneurs.
14
2.2.4 A Network’s Relational Characteristics
Another way to analyze a network is by its relations. A tie can be weak or strong,
composited of ties that are similar or diverse. Uzzi (1996, p. 694) argues that strong
and weak ties have different advantages and disadvantages for entrepreneurs and
therefore, a network should be balanced. Other researchers argue that strong ties
are more crucial than weak ties (Brüderl & Preisendörfer, 1998, p. 213). Among the
strong ties, family members play a crucial role. For example, children with parents
having entrepreneurial background are more prone to become entrepreneurs (Greve
& Salaff, 2003, p. 7). As family ties play a more important role for Indian society and
mobility issues are there as stated in chapter 2.1.1.1 Women entrepreneurs in India,
it is assumed that:
Hypothesis 4a:
High-potential female entrepreneurs in India show a network with
a higher proportion of strong ties as the networks of German high-
potential female entrepreneurs
Hypothesis 4b:
High-potential female entrepreneurs in India show a network with
a higher proportion of family members as the networks of German
high-potential female entrepreneurs
But the strength of ties is not the only researched relational characteristic. In the
context of accessing angel capital for example, Steier states a need for diversity in
networks (Steier & Greenwood, 2000).
The homophily principle states that people tend to connect to people that are similar
to themselves (McPherson, Smith-Lovin, & Cook, 2001). This applies to attributes
such as race, gender, profession or similar values and beliefs. If we want to look at
diversity, homophily effects have to be kept in mind. With gender homophily for
example, the strength of ties makes a difference: whereas in kinship ties tend to be
diverse in gender; weak ties show a stronger homogeneity (Aldrich, 1989, p. 110).
15
Based on the previous hypothesis, that Indian women have more kinship ties than
weak ties, it is assumed that:
Hypothesis 5:
High-potential female entrepreneurs in India have higher gender
diversity in their networks as German high-potential female
entrepreneurs.
16
3 Methodology and Research Design
As suggested by Bruin at al. (Brush, Bruin, & Welter, 2009, p. 16) a mix of qualitative
and quantitative methods was used. This is also the case for network related data
as the quantitative dimensions of the networks such as density and size as well as
qualitative data such during semi-structured interviews was collected.
3.1 Social Network Analysis
Social network analysis focuses on relations (ties or edges) of individuals (nodes or
vertices). In this study, certain kinds of the entrepreneurs’ so called ego-centric
networks, were examined to get a picture of their access to various resources and
finance. The “ego” is our entrepreneur; she will name contact persons, the “alteri”
and their tie will have attributes such as strength. Afterwards, network density was
measured by asking respondents if the listed alters know each other. (Wasserman,
1994, p. 41)”.
Data collection of ego-centric networks consists of two parts. The first part is the
stimulus (called namegenerator), where it is asked about certain contact persons. In
our case, we looked at the entrepreneur's business discussion networks – those
networks an entrepreneur turns to for information and support (see Renzulli et al.,
2000). The second part is the name interpreter where attributes of alter as well as
the tie are asked. Most studies ask for up to 5 – 10 persons (Wolf, 2010), here it was
asked for a maximum of 10 to have a good indication of the network size.
In this study, the instrument used to gain ego-centric data is based on Burt (Burt,
1984):
“From time to time, most people discuss important business
matters or business plans with other people. Looking back over
the past month:
Please identify the first name of up to ten (10) people with whom
you regularly speak about your business and discuss important
matters -excluding your core team members.”
17
3.2 Data Collection
Data collection was conducted in two phases. In phase one the participants filled out
an online questionnaire. The second phase involved a 20- to 40-minute phone
interview – based on data coming from the questionnaire. The interview was
conducted with a semi-structured approach that allowed also for narrative responds.
Before sampling, questions from both sources – questionnaire and interview – where
presented to an expert in start-up financing and his feedback considered. Within a
pilot sampling, the interviewee was observed during filling of the questionnaire and
was asked to give open feedback to the questionnaire. The questionnaire was
perceived as very long and exhausting, so only one discussion network was
included. The questionnaire was finalized after that; only a few interview questions
where added within the interview phase (compare Xu, 2008).
To avoid a selection bias, especially nor tapping into a given network, participants
were searched through various channels. Those included personal contacts such as
asking friends, professors and research assistants in Universities in Germany and
India, random LinkedIn search, recommendations of the founders themselves,
entries in business magazines, contacting various entrepreneurship organizations
and using newsletters and other social media channels to ask for participants.
The sample consisted of N = 34 high-potential female entrepreneurs; 15 from
Germany and 19 from India. Inclusion criteria were that the company should not be
older than six years to be considered a start-up (Xu, 2008). As expected from high-
potentials, all participants from Germany and India spoke adequate English. Two
industries where chosen that fulfilled the criteria of being either underrepresented by
female founders (technology) or more strongly represented by female founders
(fashion).
3.3 Measures
There are two kinds of variables in social network data. Structural variables measure
attributes of ties; whereas composition variables measure actor attributes
(Wasserman, 1994, p. 29).
18
In this case, the following structural attributes where measured:
1. Frequency of contact
2. Mutual resource exchange
3. Duration of connection
4. Type of relation (strength)
5. Topics talked about (resources)
6. Density (do alters know each other?)
Additionally, heterogeneity measures (gender) of ego’s network were calculated
using Mueller and Schuessler’s "Index qualitativer Variation" (IQV- Index) (Mueller
& Schuessler, 1962).
Equation 1: Mueller and Schuessler’s IQV-Index
𝐼𝑄𝑉 − 𝐼𝑛𝑑𝑒𝑥 =𝐾(𝑁2 − ∑ 𝑓2
𝑁2 (𝐾 − 1)
K= Count of categories (gender =2)
N= Count of cases e.g. (x men and y women)
∑ f2 = squared Sum of frequencies
19
As ego-centric networks of every female were generated, there are two types of
composition attributes, those of the ego (our founders) and those of her alters. For
ego, we measured the following composition variables (mostly socio-demographics)
within the questionnaire.
1. Age
2. Nationality
3. Country of company
4. Marital status
5. Number of children
6. Level of education
7. Profession
8. Years of professional experience
9. Full-time or part-time in company
10. First time entrepreneur
11. Hours maintaining contacts
12. Hours developing contacts
For alter the following composition measures were conducted:
1. Age
2. Nationality
3. Gender
4. Level of education
5. Profession
20
3.4 Data Analysis
The data coming from the questionnaire was cleaned and organized in Microsoft
Excel 2013. The Add-In “NodeXL” helped organizing network formats such as node-
and edge lists. From there, data was exported into UCINET (Borgatti 2002) - a
software for analyzing social networks - and then analyzed. For frequencies and
statistical tests, the OpenSource Software PSPP (an equivalent to IBM’s SPSS) was
used. Network graphs were plotted with the open source software Gephi.
The transliterated interviews were analyzed with MAXQDA 11. The software allows
sorting paragraphs into categories and subcategories and analyzing evolving
patterns. The coding process was based on Strauss’ and Corbin’s analysis for
qualitative data (Strauss, Corbin, & Niewiarra, 1996).
21
4 Findings
The results of the analysis are presented in the following order: First, general
descriptive data are laid out, giving the reader an understanding of the sample
characteristics. Second, results regarding the tested hypotheses are shown and
third, categories built by analyzing the qualitative interviews will be demonstrated
and made concrete by chosen excerpts. Additionally, qualitative data was used to
shed light on some quantitative results.
4.1 Findings of the Quantitative Part
4.1.1 Sample Characteristics
As shown in Table 2: Sample Characteristics of Indian and German High-potential
Women Entrepreneurs, there was a slight bigger sample of Indian women (n=19) to
German women (n=15). In our sample, entrepreneurs with children were much
higher in the Indian sample (57%) in contrast to 33 % of German women
entrepreneurs. This reflects the fertility rates of both countries (compare chapter
2.1.1 Entrepreneurship Research in Context: India and Germany). The rates of
second- and first time entrepreneurs are relatively balanced: On average 76 % of
the entrepreneurs started-up their first business. Only 5 % of Indian women were not
full-time entrepreneurs, whereas Germans 27 % worked part-time instead of fulltime
in their company. The reasons mentioned for working part time were very diverse
such as being still a student, the business does not sustain itself, having a second
company or project or being a mom. Further investigation for the reasons to work
part-time with a bigger sample is therefore recommended. When asked, if co-
founders had the same gender, it shows that 89 % of Indian high-potential female
entrepreneurs founded in a mixed gender team, whereas 67% of German high-
potential female entrepreneurs founded in a mixed gender team. This was one of
the biggest differences found in the sample characteristics. One excerpt shows what
might be a reason for funding with the other gender:
22
“If you asked me a few years ago, I would not have minded but
now I almost think that I would prefer a male. I think that in India,
still there is a lot of difficulty for women to work full time and I am
in my early 30ies and I am married and I don't have kids. But most
women in their 30ies are married and have kids and they do not
have the luxury to make their own decisions and they are not able
to commit full time.” – Indian entrepreneur
Figure 1: Team Constellation in Terms of Gender in Germany
Figure 2: Team Constellation in Terms of Gender in India
Looking at team build-up, 32 % of the Indian sample founded alone (German 20 %).
In the interviews, sole entrepreneurs were asked for the reasons to found alone. Two
types of founders were identified: The ones that do more service related work and
do not (yet) consider to collaborate. Moreover, others interviewees could not find an
adequate partner.
67%33%
GERMANY
Mixed-Gender Teams Women-only Teams
89%
11%
INDIA
Mixed-Gender Teams Women-only Teams
23
1. Not needing a partner
„I’m a freelancer at the moment, so I don’t need a co-founder. I
wanted to first create a solid base, before I take the next step
starting-up.“ – German entrepreneur
“Cause whenever I tell people that I have a “xy”1 company, they
think: what it must be? What I do and things like that. That's the
reason why I never thought I need a co-founder or something.
Because I thought my passion was enough to drive it all, maybe
(laughing)”. – Indian entrepreneur
The last excerpt above shows a mix of two reasons. The entrepreneur did not find
someone who is as passionate about what she is doing and at the same time, she
thought of being able to do it alone, although in the interview she admits that it is
sometimes difficult, also in terms of time for networking.
1 Company type changed because of anonymity reasons
24
2. Not finding a partner:
“I have often wished that I could have a partner who is specialized
in operations and growth, but I haven't actively searched that
person and nor have I met that person.”
– Indian Entrepreneur
“I have always searched for someone. I even placed ads in
magazines. But, it is hard to find someone in my space (…)”
– German entrepreneur
Table 2: Sample Characteristics of Indian and German High-potential Women Entrepreneurs
Characteristics Both nations India Germany
N 34 19 15
Sector (percent): Fashion
Technology
24
76
32
68
13
87
Children
No Children
47
52
58
42
33
67
Second-time Entrepreneur +
First-Time Entrepreneur
24
76
21
79
27
73
Full-time Entrepreneur
Part-time Entrepreneur
85
15
95
5
73
27
Single Founder 26 32 20
Mixed Gender Founding Teams 79 89 67
Most entrepreneurs in both countries were in the age groups 25 to 34 (India 58%,
Germany 67%) and 35 to 44 (India 37%, Germany 20%). As found in
entrepreneurship research, only a very small number were under 25 years old
(Aldrich, Elam, & Reese, 1997, p. 10). As expected with high-potential female
entrepreneurs all participants had at least an undergrad degree, most of the sample
even had a graduate degree (82 %). In terms of work experience mean experience
was around 10 years in both samples with a minimum of three and a maximum of
30 years (see Table 3).
25
Table 3: Demographics of Indian and German High-potential Women Entrepreneurs
Characteristics All nations India Germany
N 34 19 15
Age
15-24
25-34
35-44
45-54
55-64
3
62
29
3
3
5
58
37
/
/
/
67
20
7
7
Education
Undergraduate (e.g.BA)
Graduate (e.g. MA)
Doctoral Degree
15
82
3
16
84
/
14
79
7
Work Experience (years):
Min
Max
Mean / SD
3
30
9.79 / 6
3
19
9.21 / 4,43
4
30
10.57/7.76
As shown in Table 4 Work experience was correlated (Pearson’s r, two-sig) with the
network variables network size, density, constrain and gender diversity (IQV-Index).
The only significant correlation found was a weak negative correlation (r=-41)
between proportion of strong ties and work experience was 0.2 (p>0.05)
Table 5 shows data of the entrepreneurs’ businesses. In the Indian sample, there
was no company in Ideation state; in the German sample only 6 %. Most German
companies were in Early State (60%), whereas most Indian firms were in
Scale/Growth state. This is also reflected by the companies’ age. There was a
proportion of 57% of German companies with the age of 0-1.9 years (India 37.5 %).
Table 4: Correlations between Entrepreneur’s Work Experience and Network Variables
Work
experience
(n=34)
Proportion of
strong ties
Proportion of
family ties
Network
Constrain Network Density
Network
Size
IQV
(Gender)
-0.41* -0.3 0.05 -0.15 0.14 -0.13
Two-tailed Correlations: * p<0.05, ** p<0.01
26
In the Indian sample, there were 13 % of the companies 2-4.9 years old, whereas in
the German sample 36 % had this age. Only 7 % of German examined companies
were 5 years and older. India’s sample showed 50% of companies in this age group.
The differences in company age between the sample has to be kept in mind, as at
different company stages, entrepreneur’s show different kind of network
characteristics (Lechner, Dowling, & Welpe, 2006) and can distort results of
hypotheses testing. The size of the companies (reflected here by number of
employees) differs highly, especially as there is one firm with 400 full-time
employees in India.
Table 5: Business Characteristics of Indian and German High-potential Women Entrepreneurs
Characteristics All nations India Germany
Business State:
Ideation / Discovery
Early State / Validation
Scale / Growth
3
53
44
/
47
53
6
60
33
Company Age:
0 - 1.9 years
2 - 4.9 years
5 + years
47
23
30
38
13
50
57
36
7
Number of Full-time Employees
Min
Max
Mean /SD
0
400
15.97/68.18
0
400
25.68/90.96
0
21
3.67/5.55
Looking at the characteristics of the ego’s networks, the percentages do not show
huge differences except of the percentage of family members (India 29%; Germany
19%). Before investigating deeper in this difference in the next part, the average
numbers of both nations will be presented as in Table 6. The entrepreneur’s
networks show that they have much more contact with men than women (35%
women). 40% of the networks consisted of friends, whereas business contacts made
up 36 % of the network.
27
Table 6: Characteristics of Alteri in Ego’s Core Business Network
Characteristics Both nations India Germany
N 173 82 91
Percent of network members who are:
Women 35 33 41
Family members
Friends
Acquaintances /Business Contact
24
40
36
29
39
30
19
40
39
Age groups of network members (percent)
15-24 years
25-34 years
35-44 years
45-54 years
55-64 years
1
31
34
20
12
/
32
35
18
11
1
20
33
22
12
The average age groups of the entrepreneur’s business discussion networks did not
highly differ between the Indian and the German sample. Only 1 % of contacts where
in the age group 15-24 years. The age group 25-34 years makes up 31 % of high-
potential female entrepreneurs’ contacts; followed by the age group 35-44 years (34
%). Persons in the age of 45-54 years made up 20 % of the network. The female
entrepreneurs had 12 % of network members in the age of 55-64 years.
28
4.1.2 Results by Hypotheses
In Table 7 , all network variables that were tested are shown. The only remarkable
differences are in network size (Hypothesis 1) and proportion of family members
(Hypothesis 4b). First, it is looked at the variables that do not differ, to later test the
significance of the variables with a difference in detail.
Table 7: Network Variables of High-potential Female Entrepreneurs from Germany and India
Network Variable Country N Mean Standard Deviation
Network Size India 19 4.32 2.19
Germany 15 6.27 3.08
Network Density
India 19 .64 .18
Germany 15 .66 .25
Network Constraint
India 19 .50 .22
Germany 15 .48 .24
Proportion of Strong Ties
India 19 .68 .32
Germany 15 .63 .35
Proportion of Family members
India 19 .32 .36
Germany 15 .23 .27
IQV-Index (Tie Strength)
India 19 .47 .42
Germany 15 .48 .43
IQV-Index (Gender)
India 19 .63 .41
Germany 15 .59 .39
In terms of density, both samples revolve around a mean density of approximately
.65, meaning that the overall density is moderate. To illustrate this, the average
network would look like Figure 4 in terms of density. In this example, the
entrepreneur has one tie that is not connected to anyone, a few ties that know some
other contacts a few that know some more. In Figure 3, a discussion network with a
very low density is used as an example. Here, the entrepreneur has just two ties that
know each other. Figure 5 is an example of a network with a very high density.
29
Figure 3: Ego-Network of a high-potential female with a low density (0.28)
Figure 4: Ego-Network of a high-potential female with a moderate density (0.57)
30
Figure 5: Ego-Network of a high-potential female with a high density (0.91)
As the density does not differ a lot between both samples, it is not by surprise that
also network constraint does not show a huge difference (India .50; Germany .48).
The proportions of strong versus weak ties were calculated simply by dividing the
number of strong ties by the number of weak ties for every ego-network. A tie was
coded as strong if the contact was either named as a friend or family member. To
attenuate Marsden’s critique of measuring strengths of ties (Marsden & Campbell,
1984) some ties were coded as strong if they had the following attributes: at least 5
years old and contact frequency of at least weekly and daily. Out of these, it was
examined if ego showed any emotional connection to this person as categorized in
the qualitative data. Only then, the tie was coded as strong as well. Comparing the
means, there was no high difference between German and Indian high-potential
female entrepreneurs. With a mean ranging between 68 % (India) and 63 %
(Germany) this proportion is quite high. As a second measure, the Index of
Qualitative Variation (Mueller & Schuessler, 1962) for tie strength was calculated.
The IQV (Strength looks at a different measure, because it examines the possible
diversity’s extend. As expected because of the similarity of the proportion of strong
ties, there was no huge difference found.
31
The other diversity measure, the IQV-Index for gender, ranges in both samples
around 0.6. IQV-Index values range between zero and one, with one showing the
highest possible diversity. With a measure of 0.6, the average of the networks show
a moderate gender diversity with a drift towards diversity, but showing no difference
between the samples. To sum up, the hypotheses stating that Indian networks show
a higher density (Hypothesis 2), a higher network constraint (Hypothesis 3), a higher
proportion of strong ties (Hypothesis 4a) and a higher gender diversity (Hypothesis
5) have to be rejected. In the next paragraph, a t-test for independent samples was
conducted to examine if the observed differences in network size and proportion of
family members are statistically significant.
Hypothesis 1 stated that network size of German high-potential female
entrepreneurs is higher than that of the Indian sample. As hypothesized, Indian
women had a smaller network (n=19) with a mean of 4.32 (SD 2.19); whereas the
German sample showed a mean size of 6.27 (n=15, SD =3.08). As size was normally
distributed (K-Stest), a t-test for independent samples was used to test the
hypothesis (see Table 8: T-test for Independent Samples for Network Size). The
value for the Levene’s test for Equality of Variance was 0.1 (p>0.05) meaning that
the variability is same and we can look at the t-test results. The significance (2-tailed)
was with .04 (p<0.05) significant, meaning that there is a significant difference
between the size of Indian and German high-potential female entrepreneur’s
networks. This test procedure was repeated for the proportion of family members
(Hypothesis 4b).
32
Table 8: T-test for Independent Samples for Network Size
Levene’s Test for Equality of
Variance
T-Test for Equality of Means
F Sig t df
Sig. (2-
tailed)
Mean Difference
St. Error of
Difference
95% Confidence
Intervall of the Difference
Lower Upper
Network Size
Equal variance assumed
2.79 0,1 - 2.16 32 0.04 -1.95 0.9 -3.79 -0.11
Equal variance
not assumed
-2.07 24.35 0.05 -1.95 0.94 -3.89 -0.01
Concerning the proportion of family members in the networks, the mean of
Germany’s sample shows that it is smaller, as stated in Hypothesis 4b. Indian
women showed a mean proportion of .32 (SD .36) of family members in their
networks, while the German sample’s network consisted of .23 (SD .27) family
members. However, if we look at the t-test, it shows that this difference is not
significant (see Table 9). Therefore, Hypothesis 4b has to be rejected as well.
Table 9: T-test for Independent Samples for Proportion of Family Members
Levene’s Test
for Equality of
Variance
T-Test for Equality of Means
F Sig t df
Sig.
(2-
tailed)
Mean
Difference
St. Error
of
Difference
95%
Confidence
Intervall of the
Difference
Lower Upper
Network
Size
Equal
variance
assumed
3.95 .06 .85 32.00 .40 .09 .11 -.13 .32
Equal
variance
not
assumed
.88 31.92 .39 .09 .11 -.12 .31
33
4.1.3 Summary of the Quantitative Part
To sum up the section of quantitative research, it was found that concerning sample
statistics, more German high-potential female entrepreneurs worked part-time than
Indian ones. A high proportion of women in both samples founded with male
partners, but the proportion of German entrepreneurs who founded with other
women was 20 percent points higher than in the Indian sample. The qualitative data
did not give enough insights into the reasons why the entrepreneurs chose male
founders over female founders or whether it is a supply problem. There is an
indication that even women perceive other women as “less entrepreneurial” as
discussed on page 9 (the entrepreneur as male gendered). Also the gender
proportions of the discussion networks was unbalanced, as women made up only
35 % of the network
Around 20 % of German’s and 32% of Indian high-potential female entrepreneurs
founded their start-up alone. Two reasons for this were indicated in the qualitative
data: not finding or not needing a partner. A significant correlation between
proportion of strong ties in the network and work experience was found, indicating
that the more work experience a woman had, the more weak ties it developed. The
sample was unbalanced in terms of company stage with a low number of German
companies above 5 years of age compared to a moderate number in the Indian
sample.
Considering the hypotheses tested, only Hypothesis 1 (the network size of German
high-potential female entrepreneurs is higher than the network size of Indian high-
potential female entrepreneurs) was not rejected. All other network variables when
compared did not show significant differences.
34
4.2 Findings of the Qualitative Part
Apart from testing stated hypotheses from entrepreneurship research with a network
perspective with our samples, we also wanted to know how our entrepreneurs
network and what strategies they use. If there are not any differences between
Germans and Indians mentioned, the exploratory part will speak for both samples.
4.2.1 Characteristics of Network Relations
Table 10 shows the characteristics of the ties between ego and its alteri. Most
discussion network partners in India were contacted monthly (45%), whereas in
Germany (30%) had monthly contact. Germans seem to have a higher frequency of
contact with their alteri, showing also in the number of weekly contacts (Germany
47%, India 33%). The duration of their relation was biased, because duration of
family ties e.g. with parents distort the picture. Therefore, the duration was calculated
without kinship. The results show, that the duration of about 6 years (mean 5.78/SD
5.75) is quite similar between both samples.
Table 10: Characteristics of the Ties between Ego and its Alteri
Relationship All nations India Germany
Frequency of Contact (percent):
Once a Year
Monthly
Weekly
Daily
4
37
40
17
5
45
33
16
4
30
47
18
Duration of relationship (years)
N
Min
Max
Mean/SD
173
0.1
9.5
9.5/10.27
91
0,1
35
10.16/10.64
82
0,3
40
8.89/9.94
Duration of relationships excluding kinship
N
Min
Max
Mean/SD
132
0.1
25
5.78/5.75
58
0.1
25
5,77/6,14
74
0.3
20
5,8/ 5,46
35
Figure 6: Entrepreneurs Maintaining Contacts in Hours per Month shows the time
that every female entrepreneur spend on maintaining and developing contacts.
Within the middle field of 15-75 hours maintaining contacts per month, more German
entrepreneurs seem to be active. A higher amount of the Indian sample spend 1-14
hours per month maintaining contacts.
Figure 6: Entrepreneurs Maintaining Contacts in Hours per Month
The proportions of time spend for developing new countries seems to be similar
between the Indian and the German sample.
42
20
42
67
16 13
0
10
20
30
40
50
60
70
80
90
100
India Germany
Maintaining Contacts
1-14 hours 15-75 hours 76-300 hours
36
Figure 7: Entrepreneurs Developing Contacts in Hours per Month
Table 11: Characteristics of the Ties between Ego and its Alteri
Time Spend India Germany
Maintaining Contacts
N
Min
Max
Mean/SD
19
2
100
32.68/33.33
15
1
300
50.3/74,7
Developing Contacts
N
Min
Max
Mean/SD
19
0
100
26.8/30.5
15
1
300
34.3/74.9
Maintaining Contacts Categories (Percent):
1 – 14 hours per month
15 – 75 hours per month
76 – 300 hours per month
42
42
16
20
67
13
Developing New Contacts Categories (Percent):
1 – 14 hours per month
15 – 75 hours per month
76 – 300 hours per month
58
37
5
60
33
7
58 60
37 33
5 7
0
10
20
30
40
50
60
70
80
90
100
India Germany
Developing Contacts
1-14 hours 15-75 hours 76-300 hours
37
4.2.2 Maintaining and Developing Contacts
In the following part, categories were build based on Strauss’ and Corbin’s analysis
for qualitative data (Strauss, Corbin & Niewiarra, 1996).To maintain contacts, most
women in both samples used Social Media like Facebook or LinkedIn, or send
Emails to update people. Those activities were mostly directed to a greater audience,
e.g. by sending updates on Facebook or writing a newsletter that goes to many
people. Personal contact via phone calls and meetings are also a mean to keep up
with people. It seems that those are always valuable contacts. Often those keep-up
meetings happen during lunch or over a coffee.
For developing contacts, four categories were identified:
- Personal references
- Organizations
- Events
- “Cold” Contacting
4.2.2.1 Developing Contacts through Personal References
In the interviews, participants where asked for each business discussion contact that
was not kinship, where they encountered. The following categories arose:
Known through:
- School
- College
- Family
- Friends
- Previous Work
- Business Contact
This pattern is reflected by the answer to the question, how they develop new
contacts. Personal references are one of the most used ways for the entrepreneurs
38
to meet new people. Contacts introduce the entrepreneur to others, because they
think it could be useful to them:
“My ex-colleague just said: ‘You should meet him; he might be
interesting for you.’ And then it went really fast, a personal intro
via mail and the you meet.“ - German entrepreneur
„A cousin of one of my friends asked me to contact him because
I told her I want to start a fashion label, but I did not have any
experience in design“ – Indian entrepreneur
In the case of weak ties, introducing the entrepreneur to others is mostly motivated
by reciprocity, or at least the expectation of reciprocity:
“Or something, where I can also contribute and then go on with
the discussions. See, most of the contact needs, either come
from this need of information of a particular space, where there is
not much information available in the Internet, and only that
person based on real life experience can give me that information
- or there is something to sell. If there is something to sell, than it
is easier, because selling is also value proposition for both sides.
There is no charity involved, right?” – Indian entrepreneur
Reciprocity was not only found in the direct exchange of “contact for contact” but
many other intangible goods where exchanged on a mutual basis:
“He tells me about his projects, where he invests and I tell him
about Berlin’s Start-up Scene, he is always curious about that”
- German entrepreneur
“And I have a lot of friends who are entrepreneurs. So I do
discuss, in fact, I am the one who is solving problems for others
and I'm giving them free advice - do this, do that. I enjoy a good
conversation with them. And in the bargain I learn a lot. I give
them some free advices that I think that can work for them and in
the bargain I do learn a lot from their businesses and what I can
39
pick from their businesses and apply to mine. So all that I keep
doing.“ – Indian entrepreneur
“My interactions have mostly been either transactional, so that I
need something and I can give them something. Or at the
philosophical level. At some higher level. It has never, never been
a personal with lot of this folks.” – Indian entrepreneur
While investigating in the reciprocity of contacts, a new category emerged in
terms of the role of business discussion contacts: the one of mentors. Two kinds
of mentors where identified. (1) Formal ones that were acquired through an
organization (see chapter 4.2.2.3 Developing Contacts through Organizations)
and informal ones.
Excerpts concerning formal mentors:
“I was part of Women entrepreneur’s organization 2 Foundation,
a mentoring program that I was selected for. And I'm also
selected for the Other Women entrepreneur’s organization*
program for women entrepreneurs.” – Indian entrepreneur
“Then I also had this mentor from NGO3. There I could ask
specific questions, how do I write a business plan, how did you
do it?” – German entrepreneur
Excerpts concerning informal mentors:
“Contact name4 is like an “uncle-like” advisor, he is a business
contact”. – German entrepreneur
“So it started of like that but our relationship grew from that more.
Yeah I was paying him, cause that's how our relationship started
(…) And during that course of time he sort of become a mentor”
- Indian entrepreneur
2 Organization name changed for anonymity reasons 3 Organization name changed for anonymity reasons 4 Name changed for anonymity reasons
40
“So Contact Name is one of the pioneers in that, because he has
already done a number of companies that he sold. And he also
wants to develop that kind of ecosystem in India. So, I've been a
volunteer, and during that, I got to interact with him, and he is
very knowledgeable, some kind of Guru person. So it is very easy
to reach out to him and ask questions which are really complex
in nature and get an answer.” – Indian entrepreneur
“He is my kind of mentor and advisor because when I was in
college I made my internship under him. He had a company, I
met him through one of the college events. So he had given me
a project during my college, so ever since I have been in touch
like a mentor.” – Indian entrepreneur
Almost all informal mentors where successful entrepreneurs themselves and want
to give back their experience or help developing an ecospace in their field. Informal
mentorship was mentioned more frequently than formal mentorship. This goes in line
with findings of industry experts that advice entrepreneurs, they also tend to be
informal (Aldrich et al., 1997, p. 11).
4.2.2.2 Developing Contacts through Events
The second largest category was developing contacts through events. They
attended either domain specific events such as trade-fairs or events especially for
start-ups such as meet-ups, panel discussion or workshops. Even though almost all
entrepreneurs did use events to make contacts, they regard it as something time-
consuming. In addition, it seems as in early start-up phases, the possibility to visit
general events is more valuable and in later stages, it becomes more selective.
„I did it a lot in the beginning, but I became more selective,
because it is really time consuming and it keeps you away from
working on the product.
41
At the moment I am really selective, so I try to find out who is
there that gives me an advantage, will I meet someone and do I
already know the people there.“
–German Entrepreneur
We used to, in the beginning, yes. When we started out for the
first maybe couple of years, we have done all of that you know,
Headstart or Coffeeclub and so on. That was good, when you are
starting up, but right now, I find it takes a lot of time. – Indian
entrepreneur
Some women reported to actively participated in the events such as panel
discussions, speakers, or participation in workshops. Those women reported that it
was fruitful to be active.
“In some events I have been speaking. Most often we got a
business out of it. So we have been seeing that this makes
definitely sense for the company to do that.”
– German entrepreneur
“Yes, so I do attend conferences, It's a gateway to build contacts
and to promote my services and built my brand. I've been talking
in conferences as a speaker, quite a lot, so it's obviously an
important part.” - Indian entrepreneur
“I participate in many of these workshops or panel discussions,
so there I get to meet people.” - Indian entrepreneur
4.2.2.3 Developing Contacts through Organizations
The females also developed contacts through organizations. Four categories of
organizations could be identified:
- Start-up Organizations
(Among them women entrepreneur programs)
42
- Field specific organizations
- Voluntary organizations
- College Alumni Networks (only Indian sample)
Especially start-up organizations were named a lot by both Indian and German
entrepreneurs.
The last category, direct outreach to people was less mentioned. Women that were
directly contacted (e.g. via LinkedIn), showed a high reputation in their field or
participated actively at events as shown above. Also, they tend be valuable for their
potential network
“I invest quite a few hours a day on digital, so I have these profiles
on LinkedIn and twitter, and I am one of the few people, who has
also a profile on LinkedIn, so it is open, so I write there. So I try
to keep up to date, and try to help people who are looking for
some information in digital, so that's how I'm known in this.
People contact me, to get assistance to their business strategies
and advice.” – Indian entrepreneur
Only a few women reached out directly to people they did not know before. Also,
most of the time they used an event or a common topic to have a reason to contact.
This can be partly understood by looking at constrains high-potential female
entrepreneurs face in networking.
4.2.3 Networking Constrains
Concerning constrains to networking five categories could be identified:
- Safety and Comfort
- Time and everyday Business
- Distance and Locality
- Access to prestigious people or networks
- Gender Constrains
43
4.2.3.1 Safety and Comfort
In this category, only Indian women were identified. It includes safety issues while
travelling, especially at night but also feeling comfortable with actors, usually men.
Statements show an implication of normality by using words like “one would not” or
“women don’t”.
“But on an average, most women would not go. And also the time
when you meet people, you meet them during daytime. You don't
meet somebody at 8 o'clock, or 9 o'clock or whatever.
– Indian Woman
One women made this internalization even very explicit.
“You are comfortable during at day time, meeting in an office, in
a public spaces, you don't go to meet somebody in their house
for example. I mean one, it's of course not professional, but even
otherwise, it... it's just…doesn't. You not….you kind of tune... you
know…internalize the whole idea of reducing risks, internalizing
in your brains, right.”
“It is a safety issue, and it is more internalized, it's not something
that you consciously think "Oh, this is maybe dangerous". It is all
these, whatever, culturally or years of that kind of attitude is there,
right from parents. The way you grew up. So you, there is always
this basic defensive nature. And it is not conscious at all.”
– Indian woman
The women in India therefore prefer meeting at daytime, in public space or offices.
One way to overcome uncomfortable situations with new contacts is getting
knowledge about them or by knowing them though a reference:
“So once people validate, it is also that reference, no? It is not a
COMPLETE stranger anymore.” – Indian Woman
44
4.2.3.2 Time and Everyday Business
Time issue was the most mentioned constraint. This was also identified in the
category of using events for developing new contacts.
„I think that my issue is that I am buried so deep in everyday stuff,
that it is very hard for me to take this mental space and step away
and meet people.“ – Indian woman
“But I am so busy with the everyday stuff that there is no time to
do that” Indian woman
Especially women without a co-founder mentioned time issues.
“I cannot spend so much time in all those activities. Number one,
the constraint is, I am alone. So each and every activity, I have to
spend in each and every activity. So time constraints is one of the
parts. “– Indian woman
4.2.3.3 Access to Prestigious People or Networks
It was not mentioned as a huge obstacle, but it was reported, that sometimes
prestigious and busy people were hard to get through.
“So it's a really high level connection maybe a CTO. At least I
have not faced that problem where people had ignored my mails
- they take their own time, but they do get back”
– Indian entrepreneur
“Some of the really busy CEO types, I mean cold emailing. So I
usually do some research and figure out, how I can personally
meet them, or maybe attend a conference that they are speaking
at, or some common contact.” - Indian entrepreneur
“There is this Facebook group, and if I post something there I get
almost no reaction, but if some of the people that already founded
a company post something, they get more help. (…) When you
45
stand at the beginning, there is nothing you can trade so you can
communicate at eye level” – German entrepreneur
4.2.3.4 Distance and Locality
Most of the samples of the Indian entrepreneurs worked in Bangalore; likewise, most
German participants were from Berlin. Those cites played a crucial role. In German
interviews “Berlin” was mentioned 107 times, the word “Bangalore” occurred 32
times in the interviews. In addition, most start-up related events mentioned were also
located in Bangalore and Berlin.
Not being in Berlin was sometimes experienced as a constraint:
“The start-up scene in Berlin, I could not reach it yet. The problem
is, I’m not inside of this circle, what shall I do? I probably have to
go there and meet the people” – German Entrepreneur
“It is partly difficult, if you are not from Berlin and then you don’t
belong to the circle of the “chosen” people.”
- German Entrepreneur
„Berlin is hyped. It is the ultimate location that you have to be,
especially if you’re in the tech sector. And those start-ups there
think highly about themselves. They are in their own small world.
It is hard, to get contacts there, when you are non-Berliner“
- German Entrepreneur
A similar observation could be found in the Indian interviews:
“Currently, I'm located in Rural City5, which is in the mountains.
So I’m putting up here, I started from here. In order to expand into
the Indian market, I probably need to network with these people,
and I would probably meet these people in Cities like Bangalore,
Bombay, Chennai.” - Indian Entrepreneur
5 City name changed
46
“So probably I have to hook up with someone who has a network
in those cities already. I'm not sure, but I'm just contemplating
that it could be, that, because I'm located in a place, that maybe
I could not grow my network, that could be one reason, but I'm
not sure about it.” - Indian Entrepreneur
4.2.3.5 Gender Constrains on Networking
As discussed in chapter 2.1.1 Entrepreneurship Research in Context: India and
Germany women in both countries still face problems because of their gender. In
India it is more explicit with norms that have to follow as well as the relatively new
sight of seeing professional women.
“So usually you don't find women going out to pubs, after dinner,
I mean after work.(…) The professional networking with drinks
happens only between men. Women don't do that”
– Indian entrepreneur
“Other aspects of the gender is also, that a lot of Indian men are
not used to speak with women. They don't mean anything
negative and want to exclude, they are not as skilled enough. In
a networking room, walk towards a man that you don't know and
say "Hello, I'm doing this." It is unnatural. And most of the time I
also realized that real value connections, where you can do
something of value to each, will not happen in circumstances like
this, right.” – Indian entrepreneur
The females developed strategies to overcome those barriers. One entrepreneur for
example got into a network through sports.
“So initially, I was really depressed, because I could not talk to
anyone.(…) I got into sport6, and this is something that I do as a
hobby, a lot of people, such as techies, as well as some of the
6 Kind of sport changed to keep the entrepreneur anonymous
47
VCs are involved in that sport. And then it becomes really easy
to talk, because there is a common ground.”
Another strategy is to focus on other networks, when the access to networks similar
to “old boy-networks”- networks that favor men (Aldrich et al., 1997) - is not available.
“I somehow don't care for that (after work drinks). I mean my
networking is more focused. Very specific to my area. So these
are people who care about making a difference. Usually that kind
of you know, going out for drinks is more a corporate kind, but
really don't care for that kind of networking anymore. You know,
too much of time and it is not as intellectually appealing
anymore.”
It seems that gender discrimination is more subtle in Germany, but still existent. A
lot of it happens based on humor. On events were men are in majority, the practice
not to take women entrepreneurs seriously seems to be common.
“Sometimes you get those macho comments. My team and I were
sitting at the lawyer and I was the only women there. Then the
lawyer made comments about the “role of the women” and a
funny story about women who should rather serve coffee in
meetings” – German entrepreneur
„Sometimes there a certain kinds of men that don’t take you
seriously: you as a woman, in Technology?”
– German Entrepreneur
Especially German women themselves expressed a lot of gendered assumptions
about men and women and their networking behavior.
“The only thing women don't say anything unless they know what
they are talking about.”- German entrepreneur
Women more often thought-out and low-key, you make yourself
smaller as you are” – German entrepreneur
48
“Boys or men are generally more provoking. Just go out, try it,
speak to people, just do it and go on stage.” - German
entrepreneur
4.2.4 Summary of the Qualitative Part
Summing up the qualitative part, the main findings revolving around high-potential
female entrepreneurs’ networking behavior and activity will be presented briefly. In
terms of frequency of contact, German entrepreneur show a higher frequency of
contact with their discussion network members. Both samples’ average relationship
duration (excluding family) was around six years. On average both, German and
Indian female entrepreneurs spend around 30 hours per month on developing new
contacts. While Indians spend the same amount of hours per month on maintaining
contacts, Germans spend around 50 hours per month. This difference is not
significant as tested with a t-test for independent samples with p 0.36 (>0.05). To
maintain contacts, the interview showed that the entrepreneurs use Social Media
and emails and have personal contact with selected individuals. Personal references
was the most mentioned category to develop new contacts, followed by events,
organizations, and at the very last “cold” contacting. Reciprocity plays a role in
connecting with weak ties, so being valuable for the network is a vital strategy. It was
found that female entrepreneurs profited from two kinds of mentorship: formal and
informal, whereas the last mentioned one is even more important. Informal
mentorship is mainly given by benevolent established entrepreneurs. Being more
active in events proved also to be beneficial. Networking constrains identified were
safety and comfort, time and everyday business, distance and locality, Access to
prestigious people or networks as well as gender constrains.
49
5 Discussion and Conclusion
This thesis addressed the questions of how the networks of high-potential female
entrepreneurs in Germany and India are constituted and if there are differences
between them, keeping theories of the social network perspective in mind. Second,
in a more explorative way, the question was posed how those entrepreneurs
network.
The sample showed a high proportion of German high-potential female
entrepreneurs that work part-time. This goes in line with statistics of German female
entrepreneurs (bga bundesweite gründerinnenagentur, 2007). In addition, within the
online questionnaire the question was posed, why the entrepreneurs worked part-
time, but only very few answered it. Among the reasons for working part-time were:
being a student, the business not sustaining itself, having a second company or
project or being a mother. In German literature, the high rate of part-time female
entrepreneurs is explained by their family duties (compare chapter 2.1.1.2 Women
Entrepreneurs in Germany). As family duties are a very important factor for Indian
women as well, that does not explain this difference. As the results should stand
under reservation limitation because of the rather small sample size (see chapter 5.1
Limitations) the small sample size might be a reason for the result. Apart from any
differences among the samples, research should further examine the reasons for
high-potential female entrepreneurs to work part-time or full-time, as this has
important implications for policies supporting women entrepreneurs. The idea that
differences among samples might not be as important as had been initially expected
shows itself also in the results of the hypotheses’ testing.
The observation that the sample has more mix-gender founding teams then all-
women teams is probably biased because the majority of the observed women act
in technology – a men dominated field, at least in Germany (bga bundesweite
gründerinnenagentur, 2013), which would probably outweigh any gender homophily
effects. Another factor that could influence the tendency to found with males might
be due to the condition that entrepreneurs also found with partners or spouses (Ruef,
50
Aldrich, & Carter, 2009). Although, this was not asked in the questionnaire, in the
interviews there where mentions of co-founders being a husband or life partner. Still,
the qualitative data implies that women themselves have gendered perceptions of
entrepreneurship (see p.9 The entrepreneur as male gendered) as shown in the
qualitative part (p. 46, Gender Constrains on Networking) and this should also be
investigated. To investigate in reasons for team-formation does not imply that mixed-
teams are less acceptable. In contrast, Godwin found that mixed-sex teams are
beneficial for women entrepreneurs in male-dominated industries (Godwin, Stevens,
& Brenner, 2006, p. 631). The sample also showed approximately 26 % of founders
without co-founders. The reasons found in the qualitative interviews for founding
alone were (1) not needing a co-founder and (2) not finding a co-founder. These
reasons are reflected in Larson’s concept of venture formation as a process to
identify a need for resources (need for co-founder) and then the trial-and-error
process that is initiated by finding a “fit” for the venture (finding a co-founder) with
existing contacts such as former colleagues, family members etc.(Larson & Starr,
1993, pp. 7–8).
The hypotheses in this thesis revolved around differences in the network
characteristics of Indian and German high-potential female entrepreneurs.
Surprisingly, the only significant difference between the German and the Indian
sample is a small difference in size, with the German network being bigger. All other
network measures did not show significant differences between the German and the
Indian sample. Other research found significant differences in cross-national
comparisons of network characteristics (Aldrich & Tomoaki Sakano, 2002). In spite
of those findings - what can be the reasons for the similarity of our samples? It might
be a sign for the emergence of a global kind of high-potential female entrepreneurs.
An indication for that is the similar “start-up – ecospace” in which most of them act
that developed in Bangalore and Berlin. Thinking in terms of Fillis’ idea of
entrepreneurship as a creative process, (Fillis, 2010), Florida’s concept of the
“creative class” (Florida, 2002) can be applied. It stated that creative clusters – such
51
as Berlin or Bangalore – are able to transform culture. Indications for that can also
be found in the interviews:
“I don't think in a city like Bangalore, people differentiate based
on the gender. I don't find that happening.” – Indian entrepreneur
“I think it depends on the city and the context. Here in Berlin, it
is somehow – a level higher, so gender does not play a role
here. It is more about content than about gender roles”
– German entrepreneur
If such regional clusters attracting global talent as Florida states (Florida, 2007), it
can be assumed that this diverse hubs will be less persistent on traditional roles of
females.
The findings of the exploratory interview-based part offers insights into the
networking activities and strategies of high-potential female entrepreneurs. Still, as
stated by the Global Entrepreneurship and Development Institute (2014), conditions
for those entrepreneurs vary and are in both countries not optimal. A look at the
networking strategies and activities might shed light on this. First, a look at the
frequency of contact was taken. The frequency of contact to their discussion network
ranged mainly from monthly to weekly, whereas India had more monthly and
Germany more weekly contact to their discussion partners. This could be explained
by the higher proportion of mothers in the Indian sample, but should be investigated
further.
To maintain contacts social media such as LinkedIn and Facebook were
fundamental. The use of social media to connect to people plays a crucial role for
entrepreneurs. It is not surprising that Indian women do not lag behind. Overall,
females comprise 39% of the Indian Internet Population (comScore, 2013). Social
media sites like Facebook and LinkedIn are highly growing in India: There was a
28% increase in Facebook visitors in the last 12 months (Kemp). The Gender GEDI
index shows that Germany and India both rank around 40 % in women with LinkedIn
profiles (Global Entrepreneurship and Development Institute, 2014, p. 26).
52
In developing new contacts, the categories personal references, events,
organizations, (especially women entrepreneurial organizations) and “cold”
contacting were identified. Personal references were one of the most mentioned
ways to connect to people. Strong ties will recommend the entrepreneur to people
because of the emotional attachment. Following Granovetter’s (1973) approach of
the strength of weak ties’ those people might be less valuable, as the information
flowing in similar and cohesive networks shows less diversity and might be
redundant. Our data showed that for developing contacts with weak ties reciprocity
plays a role. It showed that it pays to be valuable for the network. Therefore, the
network needs to know in what way the entrepreneur can be helpful to them by being
visible (e.g. on social networks, Internet forums or as will be discussed in the next
paragraph, through active participation in events). Stam showed that participation in
industry events could lead to a beneficial brokerage effect for entrepreneurs (Stam,
2010). In addition, being known in the industry leads to a higher reputation- Larson
states that initially, personal reputation leads to the formation of new ties (Larson,
1992). Although, Uzzi (1996) stated that reputation is not as important for
entrepreneurs as information exchange between social relations.
Of particular interest were two kinds of mentors within the networks (1) formal and
(2) informal ones. It is shown that mentorship, especially for young entrepreneurs
benefits them (Ozgen & Baron, 2007, p. 177). Especially female entrepreneurs have
better access to finance through mentors (Carter, Brush, Greene, Gatewood, & Hart,
2003, p. 8). As the pattern evolved that informal mentors used to be benevolent
successful entrepreneurs, high-potential female entrepreneur should seek contact
to those.
The interviews showed that especially active participation in events and making
yourself valuable for your networks are vital strategies for women to get access to
diverse and helpful weak ties. As stated, seeing professional women on the forefront
of business, e.g. at panel discussions and on the stages might still be a rare sight,
especially in India. For policy makers and women entrepreneur organization’s it is
therefore vital to encourage women to participate for actively and give training
53
devoted to presentation skills. At different stages of the company, events should be
chosen accordingly to the resource needs of the company (Aldrich, Elam, & Reese,
1997, p. 3). It shows that for early stages, broader entrepreneur specific events are
fruitful, whereas industry specific and selective events are helpful at later stages.
This goes in line with the process view of contact needs in different entrepreneurial
stages (Lechner, Dowling, & Welpe, 2006). Entrepreneurs in our sample developed
new contacts through organizations such as start-up organizations and Alumni
organizations. Cold contacting was not highly mentioned as a way to develop to new
contacts. As it can be a source to valuable weak connections, a look at network
constrains might give reasons why contacting strangers is not practiced highly
among the sample.
Networking constrains identified were safety and comfort, time and everyday
business, distance and locality, access to prestigious people or networks as well as
gender constrains. Probably the biggest constrains in India is women’s safety and
comfort. It not only a huge problem for high-potential female entrepreneurs – but
also a general societal issue that needs to be addressed. Recommendations to solve
this problem would exceed this thesis’ limitations, but an exemplary perspective can
be given by how start-up themselves can contribute to solve this problem. Two
examples of social innovations by start-ups can be named: “Angel City Cabs” – a
cab service for women with women drivers equipped with additional security
arrangements such as GPS tracking and an emergency button (Prasher, October 3,
2013). Another example is women safety mobile apps that use features such as GPS
and automatic dials to friends or family in case of emergency (Sakaria, 2014).
Constrains concerning gender in Germany seem to be more subtle for example
through sexist humor. This also is a problem to be tackled from various perspectives.
One issue that pervade through this thesis are the sexist practices in
entrepreneurship research and practice criticized by Ahl in chapter 2.1.2
Entrepreneurship Research in Context: Gender. Also (Godwin, Stevens, & Brenner,
2006) approve the concept of the harmful discourse of a stereotyped view of the
54
entrepreneur. It is to hope that the emergence of various women entrepreneurship
organizations in India and Germany help to expose those harmful practices.
Other networking constrains revealed in this study were time constrains and
everyday business. As research shows, network activities and time invested in these
activities varies within different start-up stages (Lechner, Dowling, & Welpe, 2006).
This goes in line with our finding that after the initial start-up phase, - where detecting
opportunities and building the network is crucial (Singh, Hills, Lumpkin, & Hybels) -
entrepreneurs started to filter and be more selective of their networking activities. To
sum up, it must not be a constrain as such. However, entrepreneurs should start
networking more strategically with guidelines of entrepreneurship research with a
network perspective that explains what activities are useful at what times or resource
needs.
On one hand, it was shown that the start-up hubs of Berlin and Bangalore show
significant advantages for entrepreneurs. As stated before, it might even be an
emerging eco-space where gender barriers are reduced. On the other hand, not
being in those start-up nerve centers can be disadvantageous. Favorable would
therefore be a less centralized network of well-connected start-up hubs within the
country that gives access to a wider population and can react to local needs.
5.1 Limitations and Concluding Remarks
This thesis faces some limitations. Concerning the number of participants (n=34),
the sample size is rather small, so it should be taken with care to do generalizations
about the population of high-potential female entrepreneurs. In addition, the focus
on the two countries of India and Germany concealed the existence of subcultures
that might have a higher impact on networking as country differences, especially as
between the sector of technology and fashion there are differences in the
socioeconomic backgrounds of the actors.
Similar to the critiques of Ahl not to persist on differences between men and women;
it also should be taken with care on doing the same mistakes regarding apparently
“developed” and “underdeveloped” countries and do research with the connotations
55
of the “poor, victimized and disadvantaged” sample in contrast to the “developed and
advantaged” sample. This partly happened in this research, as most hypotheses
were stated as the Indian sample being on the downside, because of the difficult
conditions. As shown, differences were marginal and Indian and German
entrepreneurs developed fruitful networking strategies. The research stage is of
course still in its beginnings, but in further development the complexity of high-
potential female entrepreneurs should be considered in research designs. High-
potential female entrepreneurs face different conditions around the world. Despite
environmental difficulties, an important resource for them are their social networks.
This thesis contributed to the scares literature on high-potential female
entrepreneurs, especially by mixing quantitative network data with qualitative data.
An important insight of this study is, although cross-country comparisons in female
entrepreneurship are rare, differences in networks are more likely to be related to
factors such as industry, business stage, full-or part time entrepreneurship etc. then
those of simple country differences, assuming that subcultures are less important
than the concept of a “nationwide” culture.
The categories built in this research on how high-potential entrepreneurs network,
delivers a comprehensive basis for further investigation. Future research should
investigate deeper in different kinds of high-potential female entrepreneurs for
example the reasons to work part- or fulltime and the effects on their networks; or
the effect of “start-up hubs” such as Berlin and Bangalore on the networking activities
and barriers of those entrepreneurs.
VI
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6 Appendix
Appendix 1 – Interview Guideline for Semi-Structured Interview
- In the questionnaire you indicated you have x co-founders.
Tell me about them, how do you know each other, who are they?
- Please tell me about (Business Contact a, b, c, n), where did you get to know
each other? What is your relation? (+follow-up questions)
- How do you develop new contacts? (+follow-up questions)
- How do you maintain new contacts? (+follow-up questions)
- + questions emerging from questionnaire (see Appendix 2), e.g.
Why did you chose to start-up on your own?
Appendix 2 – Online Questionnaire7
Dear Entrepreneur,
Thank you for taking the time to fill out this questionnaire for my thesis at Zeppelin
University and IIM Bangalore.
The aim of this research is to examine entrepreneur's networks and their access to
finance through a method called "Social Network Analysis". This includes
questions about people you are in contact with. Some questions may appear
repetitive, but I kindly ask you to answer all of them, as this data is really important!
7 Questions abbreviated for reading convenience. Only questions used in this document presented.
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All data with respect to your company will be kept completely confidential.
Only the aggregated results of the data will be used in the thesis. No individual
or company specific data will be published in the thesis.
It will take approximately 25 minutes to fill out the survey.
1. First Name, Last Name
2. Please indicate your gender.
3. What’s your age?
4. What is your nationality?
5. What is your current marital status?
6. What’s the number of children you have?
7. What is the highest level of education you have completed?
8. How many years of work experience do you have?
9. We want to now, how actively you are involved in the company.
Do you work full-time or part-time?
10. You said you work part-time for the company. What is the reason for this?
11. Is this your first business?
12. In a typical month, how many hours do you spend:
a) Developing contacts (meeting new people) with whom you can discuss
business matters?
b) In a typical month, how many hours do you spend: Developing contacts
(meeting new people) with whom you can discuss business matters?
13. Business contacts
From time to time, most people discuss important business matters or
business plans with other people. Looking back over the past month: Please
identify the first name of up to ten (10) people with whom you regularly speak
about your business and discuss important matters -excluding
your core team members.
14. Please indicate [ contact ]’s gender.
15. What’s [ contact ]’s age?
16. What is [ contact ]’s profession?
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17. What is [ contact ]’s nationality?
18. What is the highest level of education [ contact ] has completed?
19. Please indicate how often you have contact with [ contact ]?
20. Once a Year, monthly, weekly, daily
21. How long have you known [ contact ] in years?
22. How would you describe your relation?
23. Family member (please specify, e.g. mother, brother...), Friend,
Acquaintance, Business Contact
24. Do [ contact6 ] and [ contact8 ] know each other? (for each combination of
contacts)
25. Information on your company
26. Company name
27. Which phase describes best the state in which your company is in?
28. Ideation / Discovery, Early Stage / Validation, Scale / Growth,Sector
29. Please indicate the gender of your co-founders.
30. Please briefly describe the product / service your company is offering.
31. How many people does your business employ, other than yourself?
32. Where is your company located?
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Ehrenwörtliche Erklärung
Ich erkläre hiermit ehrenwörtlich, dass ich die vorliegende Masterarbeit
mit dem Thema:
„Networking among High-potential Female Entrepreneurs
An Empirical Study in India and Germany“
selbstständig und ohne fremde Hilfe angefertigt habe.
Die Übernahme wörtlicher Zitate sowie die Verwendung der Gedanken anderer
Autoren habe ich an den entsprechenden Stellen der Arbeit kenntlich gemacht.
Ich bin mir bewusst, dass eine falsche Erklärung rechtliche Folgen haben wird.
Ort, Datum Unterschrift
Lippstadt, 20.06.2014