Exploring networks in the entrepreneurial ecosystem for the business development of immigrant entrepreneurs

Abstract

Research indicates that networks play a critical role in business development. However, there is a paucity of research on networks, particularly from the perspectives of immigrant entrepreneurs in emerging markets. The main aim of this study was, therefore, to explore how networks play a role in the entrepreneurial ecosystem for the business development of immigrant entrepreneurs. Specifically, the study explored the types of networks used by immigrant entrepreneurs, how the networks are developed, and the functions and benefits of networks in the business development of immigrant entrepreneurs in the South African entrepreneurial ecosystem. The study followed the interpretivist philosophy, using a qualitative research method. Data for the study were collected through semi-structured interviews with 25 immigrant entrepreneurs, selected using a purposive sampling method. Findings from the study indicated that immigrant entrepreneurs in the South African entrepreneurial ecosystem use eight types of networks in their business development, with social networks being the most frequently used and international business networks being the least used. In addition, the study found that immigrant entrepreneurs develop their networks using several methods, with trust being the most frequently used mechanism and idea pitching, outsourcing and subcontracting being the least used mechanisms. The study stressed the importance of reciprocity of trust in the network development process. Furthermore, referrals emerged as the most important function of networks in the business development of immigrant entrepreneurs. While resource provision also emerged as another major function of networks for immigrant entrepreneurs, finance stood out as the most important resource provided by networks. Finally, the study identified financial growth as the most important benefit of networking by immigrant entrepreneurs. This study, therefore, makes a significant contribution and adds to the academic literature by revealing the various but specific ways in which immigrant entrepreneurs develop the networks that they use in their business development in the South African entrepreneurial ecosystem, an area that has received little to no attention from scholars. Another significant contribution of the study is that it uncovered the specific types of networks which immigrant entrepreneurs used in their business developments in the host country's entrepreneurial ecosystem. Implications of the study were discussed, and recommendations were made.