Showcasing strategies in entrepreneurs' quest for venture capital funding: evidence from Twitter

It is widely established that entrepreneurs’ social capital is a valuable asset in their search for external funding. However, relatively less is known about how entrepreneurs can actively engage in networking strategies to improve, or exploit, their social capital to attract investment. In this study, we examine two such strategies – showcasing visibility and showcasing similarity – and assess their effect on entrepreneurial ventures’ ability to obtain a first round of funding. We argue that showcasing visibility behavior increases a venture’s salience among prospective investors, whilst showcasing similarity vis-à-vis high-status role-model entrepreneurs facilitates legitimacy. Based on a comprehensive dataset of London-based technology entrepreneurs combining Crunchbase and Twitter data, we find that showcasing visibility and similarity strategies increase the likelihood of obtaining venture capital funding, particularly for entrepreneurs with a peripheral position in the informal network of London’s entrepreneurial ecosystem