The Conditional Importance of Prior Ties: A Group-Level Analysis of Venture Capital Syndication

While there is growing scholarly interest in multiparty collaborations that involve three or more firms, most of this literature has focused on the governance, performance, and dissolution of such collaborations. Accordingly, less is known about which multiparty collaborations are likely to form or the extent to which the formation of multiparty collaborations may differ from the formation of dyadic collaborations. We address these gaps by exploring the formation of multiparty venture capital syndicates—a context that exhibits substantial multiparty collaboration but is not often examined through the multiparty lens. We argue and show that multiparty syndication is influenced by a number of group-level constructs. We highlight how group-level venture capital syndicate formation is not a simple deductive elaboration of dyadic venture capital syndication, but, instead, involves different constructs and logics. We also offer insight into how status dynamics may differ between dyads and groups.