Building up valuable networks can be one of the most awkward and time-consuming activities for an entrepreneur. Here we want to offer a new approach to networking, one which makes it easier to begin the task of building a beneficial network.
This new method starts with thinking about social capital.
Social capital has been defined in many ways. In the context of networking, we think of social capital as the trust and goodwill that exists in a group of people with common goals and values.[i]
Trust is essential in all relationships, but particularly so for entrepreneurs, who can often be perceived as the outsider acting on their own behalf rather than for the benefit of a group. As a result, entrepreneurs must work extra hard at creating good relationships and contribute more to achieve the same effect.
When so much time and effort is required for an activity, it is well worth understanding what leads to excellent networking success and what doesn’t.
When your networks don’t provide the desired value
Let’s look at networks that don’t work.
In today’s world, it seems easy to connect to any person on the planet through social media. However, when Andrew, an entrepreneur with a promising technology, looked at his LinkedIn connections, his heart sank. In the past, he had been reluctant to engage in social media, and as a result, his LinkedIn connections consisted of a few former colleagues plus that guy he was trying to avoid during university. How could this possibly help? He knew the right people were out there, but how do you connect with them when you feel you have no reason to contact them.
Traditional networking can feel even more awkward. During a recent networking event, Andrew started enthusiastically introducing himself to strangers but inevitably ended up spending most of the time talking to one person that he couldn’t shake off, that he had nothing in common with, but who was thrilled to tell Andrew all about his cheese-making business. Andrew went home with some useless business cards vowing never to do it again.
Networking with the intention of building social capital
If your way of networking would be best described as random, it might be time to try a new approach. Think about networking as an exercise in building social capital. Here are some steps you can take for a more satisfying outcome.
Firstly, you need clarity around why you are networking.
Networking for social capital means you are purposefully developing relationships with the aim of furthering your business. However, you cannot jump straight to the end where you benefit from the social capital.
Be clear that you first need to gain influence and trust. Ultimately the sequence will look like this: social capital leads to influence, influence leads to trust, and trust leads to the benefit you seek. Your thinking, therefore, needs to start with finding initiatives that matter to you and which are aligned with your business.
No man is an island; significant changes can only be achieved through cooperating with other people. Start by finding out which networks already exist, introduce yourself and make it clear that you have come with the intention of contributing to the effort.
Seek out the best individuals for your networks
Whilst powerful, influential individuals are highly desirable networking partners, they are often inundated with requests and therefore may not be accessible and ready to engage with you.
You may be better off looking for less established individuals that you can form a relationship with. Building mutual understanding with these individuals may lead to introductions to more influential people in the future when you have established your trustworthiness.
You may also want to have a plan for engaging and maintaining relationships. In building social capital, you will need to contribute by acting in a way that is not seen as self-serving and not ostensibly for the benefit of your business. As time is your most precious commodity, you must consider acting where you get the best results for your efforts.
Combine the right mixture of people in your network
Entrepreneurs ideally need to have two kinds of skills. The first includes broad skills such as selling, envisioning, understanding finance, connecting with people and disseminating information. The second are deep skills, such as knowledge of an industry or personal skills like a thorough understanding of a particular technology for example.
Networks that support broad skills allow entrepreneurs to find moral support and get access to expertise in areas with weaker competence. In this context peers are especially useful as fellow entrepreneurs are frequently in similar circumstances, having just overcome an obstacle or preparing to do so. Another type of individual that is useful in your broad network are brokers, people who do networking for a living. These people can be found in roles such as public relations, recruitment or fundraising.
Finding networking partners to improve broad skills is relatively easy. In comparison developing connections to enhance deep skills can often be more difficult for entrepreneurs.
Entrepreneurs are in a different situation from employees. They are relatively isolated and don’t have the automatic access to colleagues in the industry that employees enjoy. This means deep skill connections can be particularly valuable as they can lead to the exchange of in-depth knowledge, the uncovering of new opportunities or introductions to talent that your business may need.
It is therefore vital to deliberately put yourself into positions where you have a chance to make new deep skill encounters. You can find individuals for deep knowledge networking in roles such as consultants and patent lawyers.
Build relationships with the future in mind
Finally, have confidence that the relationships you build will pay off over time. Humans are social animals, and the law of reciprocity is ingrained in our nature.[ii]
Not persevering in the pursuit of building meaningful relationships leads to weak and ineffective networks. Networks only perform for the benefit of everyone when they are dynamic and show frequent and worthwhile interactions between the members of the network.
As a final thought, I want to leave you with a quote from Wayne Baker, the author of Achieving Success Through Social Capital.[iii] According to him:
“Studies show that lucky people increase their chances of being in the right place at the right time by building a ‘spider web structure’ of relationships that catch information.”
Hopefully, you will be able to create your spider web of connections from here.
The Master in Entrepreneurship at Cambridge Judge Business School teaches many new ways of thinking about networking, one of these is through focusing on social capital building.
Find out more about our Master of Studies and Diploma in Entrepreneurship programmes.