DISQUS

erickschonfeld · 5 months ago

Great analysis, Matt. Thanks for following up. My post on TC was only meant to provide a list of the most networked VCs, which I think is interesting in-and-of itself. I point to the earlier study just to note that there may be a correlation between network size and performance. But as you point out, we don't really know yet whether firms in the top 100 will outperform. At least now we can start tracking thee things, though.

chrisrauh · 5 months ago

One should also remember that even on a high correlation, there will be a number of VCs on the list which would not do well. Even if half that list underperforms you can still see a high correlation between network size and performance. Also, you can have a correlation stronger on the other side, with small networks underperforming more than the larger ones outperforming.

Michael F. Martin · 5 months ago

Dynamic centrality is the term for these sorts of networks.

http://papers.ssrn.com/sol3/papers.cfm?abstract...

yhochber · 5 months ago

Matt -

Our Journal of Finance paper is very, very careful to prove a causal link between the extent of a VC's network and subsequent success. The way we do the analysis, we also get at your chicken and egg problem: our methodology ensures that we're not just capturing "success breeds a good network" -- in fact, the second half of the study looks at what factors affect a VC's network and shows that prior performance isn't really the driving cause. I invite you to read it carefully, and I am happy to chat with you about it as well.

While I can't speak for the PEhub study you reference, I can speak for our (peer-reviewed) study: We show clear evidence of a CAUSAL link between a VC's network and his success.

Also worth mentioning: size and network are not as correlated as you might think (and neither are experience and network).

Thanks for mentioning our work.