Constructing Deal Networks: Brokers as Network “Architects” in the U.S. IPO Market and Other Examples

By Timothy G. Pollock, Joseph Porac, James B. Wade. 2004

202 citations recorded by the source corpus.

We introduce the concept of the network architect to extend theory explaining how brokers create and manage structural holes in mediated markets. We argue that a broker's social resources and dependence on the market, along with exogenous deal conditions, influence the broker's motivations and willingness to make tradeoffs between long-term and short-term considerations when constructing deal networks. We develop our model and propositions in the context of the U.S. initial public offerings market and then generalize these arguments to other market contexts.

Subfields: Accounting, Finance

View Paper: https://www.semanticscholar.org/paper/fa7aebe7787a95d91b7d3ab11beb4845cdceec95

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Citations in the corpus

Network Strategies and Performance of Canadian Investment Banks (2006, unknown): “Numerous studies provide rich accounts on the functioning of IPO markets and investment banks (e.g., Eccles & Crane, 1988; Ellis, Michaely, & O’Hara, 2000; Podolny, 1993; Pollock et al., 2004 ); thus, here I provide only a brief overview.”
Standing out from the crowd: the visibility-enhancing effects of IPO-related signals on alliance formation by entrepreneurial firms (2007, background): “The willingness of prestigious underwriters to risk their reputational capital by serving as the lead underwriter of an initial public offering is generally recognized as a powerful signal of the focal firm’s promise (Carter and Manaster, 1990; Hayes, 1970; Higgins and Gulati, 2003; Pollock et al., ”
Toward a Behavioral Theory of Strategy (2012, background): “diffused (cf., for instance, Porac et al., 1995; Pollock et al., 2004; Barron, 1998; Khurana, 2007), and is somewhat similar to what happens to biotic organisms (Odling-Smee et al.”
Standing out: how new firms in emerging markets build reputation (2007, background): “…however, is of limited value for understanding how new firms in emerging markets build their reputations, because new firms lack reliable performance records (Gompers and Lerner, 2001), as well as the resources necessary to invest in relevant signals (Williamson, 2000; Pollock et al., 2004).”
How much prestige is enough? Assessing the value of multiple types of high-status affiliates for young firms (2010, methodology): “…of prestigious executives, 7 Underwriting syndicates consisting of other investment banks are also generally involved in the distribution of shares, and the extent to which more high status underwriters are included in the deal can influence the distribution of the stock (Pollock et al., 2004).”
Secondhand Brokerage: Evidence On The Importance Of Local Structure For Managers, Bankers, And Analysts (2007, background): “…(2002), Baker (2000), Brass, Galaskiewicz, Greve, and Tsai (2004), Burt (2005), Cohen and Prusak (2001), Cross and Cummings (2004), Cross and Parker (2004), Lin (2002), Monge and Contractor (2003), Oh, Chung, and Labianca (2004), Pollock, Porac, and Wade (2004), and Soda, Usai, and Zaheer (2004).”
The contingent value of venture capitalist reputation (2011, background): “Because the survival and success of new organizations are laden with uncertainty and risk (Stinchcombe, 1965), market participants often rely on interorganizational endorsements via affiliations with prominent and highly reputable third parties as signals of a firm’s quality and potential (e.g. Baum”
Are network effects really all about size? The role of structure and conduct (2013, background): “In the former network, the investment bank mediates between investors who want to buy stocks and the start-ups that want to issue the stocks—a twosided network (Pollock et al., 2004; Parker and Van Alstyne, 2005).”
EFFECTS OF SOCIAL CAPITAL AND POWER ON SURVIVING TRANSFORMATIONAL CHANGE: THE CASE OF INITIAL PUBLIC OFFERINGS (2004, background): “Underwriters can enhance network stability by including investors with whom they have “embedded” relationships in the initial IPO deal network (Pollock et al., 2004).”
Better Together? Signaling Interactions in New Venture Pursuit of Initial External Capital (2016, background): “…1994), a discerning intermediary (Rao, 1994), a certifying institution (Baum & Oliver, 1991), or any third party with information about the young firm that potential investors believe to be superior to their own information (Dean & Biswas, 2001; Pollock et al., 2004; Zhang & Wiersema, 2009).”
Puttin' on the Ritz: Pre-Ipo Enlistment of Prestigious Affiliates as Deadline-Induced Remediation (2008, unknown): “…the effects of prestigious affiliates on organizational outcomes (Benjamin & Podolny, 1999; Carter & Manaster, 1990; Certo, 2003; D’Aveni, 1990; D’Aveni & Kesner, 1993; Hambrick & D’Aveni, 1992; Haunschild, 1994; Podolny, 1994; Pollock et al., 2004; Sanders & Boivie, 2004; Stuart et al., 1999).”
A framework for comparing entrepreneurship processes across nations (2005, background): “oriented toward generating large returns quickly (Gompers, 1995; Pollock et al., 2004) and founding entrepreneurs ceding significant control to investors favoring a quick sale either through an IPO or”