A bi-weekly column exploring the intersection of entrepreneurship and community by Sam Davidson
Social capital is the term people use to describe the favors we do for one another, and the goodwill it “banks” toward future asks. It’s the value we derive from donating to a friend’s charity, knowing (and hoping) deep down they’ll donate to ours when we ask in a few months.
Social capital is how we assign relative value to the relationships in our lives. It’s what makes us groan or roll our eyes when a certain person texts or calls, and leads us to ignoring them and offering no response. These are the takers who drain our communal bank account leaving us stressed and burdened much like when our real checking account is low and rent is due.
On the other hand, the givers replenish us and fulfill us. They make us happy when we see them and we’re eager to respond to their requests for help. Our willingness to pitch in isn’t based on the feeling of a lopsided balance sheet, but rather the confidence that if and when it’s our time to ask, they will do what they’ve been known to do: give.
It’s wise for entrepreneurs to keep in mind the notion of social capital as they embark on a fundraise or try to navigate the complex capital landscape. While a strong pitch deck and proforma matter, so does the social fabric we’re all weaving together.
Case in point: a few months ago the EC started an experiment by adding Haley Zapolski as our Capital Connector. We collectively wanted to prove a hypothesis: if we map the funder and founder landscapes and offer entrepreneurs an easier path to find investors, they’ll take us up on that assistance.
In less than 90 days, Zap has done 50 founder intakes, brokered 151 introductions between entrepreneurs and investors, spoken with 56 funds or funders – all of which has resulted in over $150k in investment dollars raised.
All the elements were there in the ecosystem. But it took a social capitalist to connect them.
Two more cases in point:
1. The Greater Nashville Venture Capital Association (GNVCA) had its opening reception this week. This new group aims to connect and grow the profile of venture investing in Nashville and will soon deeply map institutional money in and around the city, raising Nashville’s profile as a hub for innovation and investment.
2. LaunchTN’s InvestTN program continues to grow as it reaches across the state to help founders with their raises as they seek to start and grow important companies in Tennessee. The EC will be hosting a Capital Conversation event on 11/30 at 4PM. RSVP here to reserve your spot.
It would be great if one day completing your round as an entrepreneur were as effortless as calling an Uber. For now it’s a lot like asking your friends for a ride to the airport. You calculate who would actually consider driving you, who’s available, and who you’d enjoy going with. And while it seems calculated and tedious, the ride is better this way and maybe one day you’ll happily say yes when they need a lift.
Until that day comes, the best we can do is continue connecting – socially – so great ideas can find the right money to take them to the next level. When it comes to equity capital and social capital, we are always better together.
