BRINGING PERSONALIZED TIES BACK IN: Their Added Value for Biotech Entrepreneurs and Venture Capitalists Interorganizational Networks

Using a unique data set collected in France among biotech entrepreneurs and their venture capital investors (VCs), we measure the added value of personal relationships at the interorganizational level. Our analyses show that when two entrepreneurs share a personal collaboration tie or a personal friendship tie with a VC investor, the probability of having an advice tie and thus exchange tacit knowledge increases significantly. We confirm the importance of this kind of social embeddedness in the biotech industry where personalized ties--as opposed to institutional and contractual relationships--at the interorganizational level had not yet been examined systematically. Our results suggest that strategies of personalization of exchanges are vital for interorganizational learning. These strategies help entrepreneurs to access resources, participate in knowledge building, and co-orientate activities in this sector.