How is high-tech entrepreneurship able to grow in Sofia, Bulgaria? A social capital perspective.

Entrepreneurship is considered as a critical factor for the development of transition economies and currently attracts a growing body of research. Following a qualitative case-study research strategy, this paper is occupied with the emergence of Sofia, the capital of Bulgaria, as a location of high-tech entrepreneurship in the country. While the legacy of the socialist past is part of Sofia reality, the entrepreneurs in the capital appear to make considerable efforts to overcome these barriers. Applying a social capital perspective I articulate the link between entrepreneurship growth and entrepreneurs’ social context. Internationalization from early stage of start-up development is perceived as the main growth path, which requires the entrepreneurs to accumulate new social relations. Adopting a process oriented analysis, I observe the shift in the social capital content and how start-ups can benefit from their pre-existing and emerging social relations. I contend that the acquisition of social capital by studied entrepreneurs has a specific added value for the studied companies as in this process they are required to adopt new norms and practices that are distinctive from those generally observed domestically. This process, however, poses certain concerns for start-ups’ survival prospects due to its high costs