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In this paper, we propose a dynamic model of entrepreneurial firms’ dependence on networks. First we argue that five characteristics of entrepreneurial firms result in their high dependence on networks; these five characteristics include entrepreneurial orientation, central role of the entrepreneur, resource constraints, pursuit of flexibility, and niche market focus. We then examine how entrepreneurial firms’ growth is accompanied by the evolution of these five characteristics leading to a shift in the mode through which entrepreneurial firms construct and deploy their networks. In particular, we examine the composition and the stability of entrepreneurial firms’ networks. This paper contributes to building a more integrative theory of entrepreneurship.

The evolutionary model of entrepreneurial firms' dependence on networks: going beyond the start-up stage