Exploration and exploitation activities in start-ups: The role of network participation

Key words: Innovation, start-ups, exploration, exploitation, formal networks Purpose: The purpose of this thesis is to explore the effects of formal network participation on exploration and exploitation activities in start-ups. Methodology: Following a cross-sectional design, an explorative study was conducted using semi-structured interviews. 18 interviews were performed with representatives from 14 start- ups and three different start-up networks. Data was analysed using marginal remarks and pattern coding, resulting in six common themes. Theoretical perspectives: Previous research has described the importance of exploration and exploitation activities and the need for firms to strike a balance between them in order to obtain long-term success. However, previous studies have largely concerned mature firms and research on how these activities are handled in start-ups is lacking. It is common for start-ups to engage in network activities in order to sample resources; therefore, this study aims to contribute to current literature by investigating the connection between network participation and innovation behaviour in terms of exploration and exploitation. Empirical foundation: The Malmö-Lund region in Sweden has a very active and thriving start-up scene. Three of the most active formal network organisations in the region were chosen to form the basis of this study: MINC, Malmö Startups, and Ideon Innovation. Founder and CEOs from 14 different start-ups within the networks participated representing industries ranging from production to technology and services. Conclusions: Entrepreneurs who enter into start-up networks can gain positive outcomes in terms of guidance and knowledge sharing, social platforms, and various strategic benefits. However, these outcomes can be enhanced or mitigated depending on the entrepreneurial intent and personal motivations of the entrepreneur. These outcomes, in turn, affect the way start-ups approach exploration and exploitation. Furthermore, start-up networks do not work in isolation but are part of a larger context where networks intertwine and individuals frequently move across network boundaries