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Strategic Networking for Entrepreneurs

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Workshop held at Global Entrepreneurship Week 2010.

Workshop held at Global Entrepreneurship Week 2010.

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  • Full Name Full Name Comment goes here.
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  • Thanks Clint - I agree about having to be motivated to use your network to achieve the benefits it could bring to you.

    But http://www.slideshare.net/sachac/the-shy-connector provides a great idea how to network efficiently without being too extroverted. The challenge of ’Strategic Networking’ is mostly defining your needs (in terms of information, knowledge, resources and contacts/reach) and then identifying people who could help you solving these issues.

    The next logical step is to monitor if these relationships are actually up to the standard you want them to be, which is what Handy Elephant is doing - so another way for the individual to reach the stage of networking strategically.

    But you’re right, it can be way more efficient to just have a few other people in a venture who have an additional few hundred contacts - hopefully with a good amount of diversity to my own network.

    Best regards
    Benjamin F. Wirtz
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  • Pretty good break-down of a natural networker who enjoys living life and making connections. Sounds easy if you are that type but if not surround yourself with at least a few team members who are and success will follow.

    ~Clint
    @cazoomi
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Strategic Networking for Entrepreneurs Strategic Networking for Entrepreneurs Presentation Transcript

  • Strategic Networking for Entrepreneurs
    Do you have the right contacts?
  • Benjamin F. Wirtz
    • BSc Information Systems
    • Research project on social networks
    • MSc E-Business & Innovation
    • Business Idea: around supporting networkers
    • Dissertation: Strategic Networking for Entrepreneurs
    • Distinction + best dissertation – while starting up
    • Now:
  • Many sales people get 80-90% of their business through networking organizations.
    A referral generates 80% more results than a cold call
    74% of all buying decisions are made on a friend’s recommendation
    Meeting 2-3 people at an event and learning more about their needs and challenges is far more valuable than collecting (or giving away) 20 business cards.
    About 70% of all jobs are found through networking
    Socially embedded employees are 40% less likely to quit their job.
  • The tale of two entrepreneurs
    • Normal vsStratNet
    • Table through stages
  • Overview
    • What to take away
    • Networking important for venture success
    • How to “plan” your social capital
    • How to put the plan into practice
    • Workshop (hands on!)
    • Analyse your goals and needs
    • Check if/how your network can help you
    • Plan to align your network towards success
  • The lecture bit
  • Talking to people
    Swapping business cards
    Selling yourself
    The art of making and maintaining relationships
    It’s all about exchange !
    Giving and taking
    Strategic Networking for Entrepreneurs
    What is Networking ?
    7
  • Strong ties are less diverse – but more efficient
    Networks in opposition to hierarchies and markets
    Strategic Networking for Entrepreneurs
    Diversity in Networks
    8
  • Crucial for exchange in networks:
    Trust (comes from positive experiences over time)
    Perceived value of further cooperation by others
    Social Capital = value, which is embedded in relationships
    Potential access to information, knowledge, resources, contacts
    Strategic Networking for Entrepreneurs
    What is Social Capital ?
    9
  • Social Capital not valuable by itself
    Nor measurable
    But allows
    Strategic Networking for Entrepreneurs
    Value of Social Capital
    10
  • How can networking be valuable?
    Social Capital
    Value
    enables
    access to
    creates
    Networking
    delivers
    Information, Knowledge, Resources
    affects
    Goals
    requires
    Strategic Networking for Entrepreneurs
    11
  • Important throughout venture lifetime...
    ... but especially at the beginning
    Market insights, startup ecosystem
    Feedback and new ideas
    Examples
    Bank Loan vs. Hearing about public grants
    Comparing offers vs. Getting recommendations
    Stealth startup fail vs. Idea evaluation & pivoting
    Strategic Networking for Entrepreneurs
    12
    Benefits (I): Getting Information
  • Important whenever you start something new...
    ...and you have to do it yourself
    Tacit Knowledge
    based on experiences, culture
    Hard to transfer
    Examples
    Trial&Error vs. Learning from other’s experience
    Paying an accountant vs. Learn how do accounts
    Accept given deals vs. Learning how to negotiate
    Strategic Networking for Entrepreneurs
    13
    Benefits (II): Transfer of Knowledge
  • Before you start to buy new things...
    ... salvage, beg, borrow, bargain
    Or get time commitments
    Examples
    Paying a web designer vs. Asking a friend to do it
    Hiring a part-time employee vs. Family Member
    Renting an office vs. Using a friend’s spare space
    Strategic Networking for Entrepreneurs
    14
    Benefits (III): Resources
  • “Ideas that spread, win” (Seth Godin)
    Visibility
    Credibility
    Crowdsource network search
    Examples
    Advertising vs. Viral marketing
    Cold calls vs. Getting introduced
    Complex recruiting vs. Friend of a friend employee
    Strategic Networking for Entrepreneurs
    Benefits (IV): Spreading Information
    15
  • Contacts do not come for free
    And Relationships need to be maintained
    Set targets...
    ...and check your performance
    If not on target, analyse why
    Or switch to plan B
    Strategic Networking for Entrepreneurs
    Effort vs. Value
    16
  • Networking by itself has no value at all
    It’s what you can give and get through relationships
    Efficiency through diversity
    You can’t have everything yourself
    Dunbar’s number: You can’t havemore than (roughly) 150 friends
    Cognitive constraint
    Strategic Networking for Entrepreneurs
    Why a strategic approach?
    17
  • Strategic Networking for Entrepreneurs
    What is Strategic Networking?
    Aligning your network towards achieving your goals
    Strategic
    Analysing your needs and haves
    Planning your relationship portfolio
    Tactical
    Planning networking events
    Juggling socialising and working
    Operational
    The talking & shake hands part (exchange)
    18
  • Dunbar’s Number
    For every new relationship, you will drop another one
    Give before you take
    Make introductions yourself
    Sustainability
    People are connected
    Good/bad reputations spread
    Strategic Networking for Entrepreneurs
    Ethics of Networking
    19
  • The workshop bit
  • Strategic Networking for Entrepreneurs
    Strategic Networking Framework
    21
  • For all steps on back of workshop material pages
    Strategic Networking for Entrepreneurs
    Prepare Example !
    22
  • Define a goal (e.g. succeed with a business idea)
    And make a rough plan how to achieve it
    Define your needs
    Information Input (e.g. competitors, market situation)
    Tacit Knowledge (e.g. how to run a start-up)
    Resources (e.g. funding)
    Information Output (e.g. to get a strong partner on board)
    Strategic Networking for Entrepreneurs
    Analyse
    23
  • Analyse what you have and whom you know
    Match to needs
    Plan A (easy) and plan B (backups or ideal)
    Is your relationship at the right level?
    Create your Relationship Portfolio
    Know your “hubs” (people with lots of contacts)
    Ensure diversity
    Strategic Networking for Entrepreneurs
    Plan
    24
  • Use tools to support networking
    LinkedIn (find suitable contacts)
    Foursquare (meet them “on the fly”)
    Twitter (find out what they are up to)
    Trust serendipity
    Reflect if you are on target
    HandyElephant
    Strategic Networking for Entrepreneurs
    It’s all planned – what now?
    25
  • Strategic Networking for Entrepreneurs
    Networking Cycle
    26
  • For shy/introverted people:
    http://www.slideshare.net/sachac/the-shy-connector
    Ground breaking paper:
    Granovetter (1973) – The Strength of Weak Ties
    For short breaks:
    TED.com (e.g. Daniel Kahneman)
    Wikipedia: Expected Utility Theory, Prospect Theory
    Strategic Networking for Entrepreneurs
    Further Reading
    27
  • Find the slides at http://bit.ly/StratNetEntre
    Benjamin F. Wirtz
    Email: ben@handyelephant.com
    Twitter: benfwirtz
    Feedback and recommendations highly appreciated !