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Disentangling the multiple effects of affiliate reputation on resource attraction in new firms

(2016) ORGANIZATION SCIENCE. 27(6). p.1525-1547
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Abstract
Past research has established that new firms can enhance their attractiveness to prospective resource providers by affiliating with more reputable firms. But research on this process has yet to fully account for two critical realities underscored by recent research: (1) firms need to acquire resources from different groups of resource providers and (2) reputation is multidimensional. Drawing on the organizational reputation literature and on information processing theory, we propose that two groups of resource providers will respond differently to new firms’ affiliations in accordance with differences in the groups’ abilities to recognize and interpret reputation-related signals. We also propose that within a single group of resource providers, distinct characteristics of the affiliate will exert different influences. We test these propositions using longitudinal data from Belgian firms that affiliated with venture capital (VC) investors. Consistent with our predictions, we find that characteristics of a VC affiliate exert more influence on prospective financiers than on prospective employees. We further find that prospective financiers were more influenced by a VC’s industry-specific experience than by its media prominence, whereas prospective employees were more influenced by a VC’s media prominence than by its industry-specific experience. Taken together, the findings show that new firms’ resource attraction trajectories are shaped by their affiliates in more complex ways than past research has accounted for.
Keywords
reputation, new ventures, information processing, venture capital, growth

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MLA
Vanacker, Tom, and Daniel Forbes. “Disentangling the Multiple Effects of Affiliate Reputation on Resource Attraction in New Firms.” ORGANIZATION SCIENCE, vol. 27, no. 6, Informs, 2016, pp. 1525–47.
APA
Vanacker, T., & Forbes, D. (2016). Disentangling the multiple effects of affiliate reputation on resource attraction in new firms. ORGANIZATION SCIENCE, 27(6), 1525–1547.
Chicago author-date
Vanacker, Tom, and Daniel Forbes. 2016. “Disentangling the Multiple Effects of Affiliate Reputation on Resource Attraction in New Firms.” ORGANIZATION SCIENCE 27 (6): 1525–47.
Chicago author-date (all authors)
Vanacker, Tom, and Daniel Forbes. 2016. “Disentangling the Multiple Effects of Affiliate Reputation on Resource Attraction in New Firms.” ORGANIZATION SCIENCE 27 (6): 1525–1547.
Vancouver
1.
Vanacker T, Forbes D. Disentangling the multiple effects of affiliate reputation on resource attraction in new firms. ORGANIZATION SCIENCE. 2016;27(6):1525–47.
IEEE
[1]
T. Vanacker and D. Forbes, “Disentangling the multiple effects of affiliate reputation on resource attraction in new firms,” ORGANIZATION SCIENCE, vol. 27, no. 6, pp. 1525–1547, 2016.
@article{8162470,
  abstract     = {{Past research has established that new firms can enhance their attractiveness to prospective resource providers by affiliating with more reputable firms. But research on this process has yet to fully account for two critical realities underscored by recent research: (1) firms need to acquire resources from different groups of resource providers and (2) reputation is multidimensional. Drawing on the organizational reputation literature and on information processing theory, we propose that two groups of resource providers will respond differently to new firms’ affiliations in accordance with differences in the groups’ abilities to recognize and interpret reputation-related signals. We also propose that within a single group of resource providers, distinct characteristics of the affiliate will exert different influences. We test these propositions using longitudinal data from Belgian firms that affiliated with venture capital (VC) investors. Consistent with our predictions, we find that characteristics of a VC affiliate exert more influence on prospective financiers than on prospective employees. We further find that prospective financiers were more influenced by a VC’s industry-specific experience than by its media prominence, whereas prospective employees were more influenced by a VC’s media prominence than by its industry-specific experience. Taken together, the findings show that new firms’ resource attraction trajectories are shaped by their affiliates in more complex ways than past research has accounted for.}},
  author       = {{Vanacker, Tom and Forbes, Daniel}},
  issn         = {{1047-7039}},
  journal      = {{ORGANIZATION SCIENCE}},
  keywords     = {{reputation,new ventures,information processing,venture capital,growth}},
  language     = {{eng}},
  number       = {{6}},
  pages        = {{1525--1547}},
  publisher    = {{Informs}},
  title        = {{Disentangling the multiple effects of affiliate reputation on resource attraction in new firms}},
  url          = {{http://dx.doi.org/10.1287/orsc.2016.1090}},
  volume       = {{27}},
  year         = {{2016}},
}

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