Social Networks and Entrepreneurship

Required readings:
“Jerry Sanders” Harvard Business School Case
Uzzi and Dunlap, “How to Build Your Network”
Concept video: Social Networks (please watch before class)

Today’s session will focus on the potential power of social networks, particularly within the area of
entrepreneurship. Jerry Sanders is clearly a master networker – in the space of a few months he turns
an idea for a medical device firm into a transaction worth tens of millions of dollars. In reading the case
study, focus on two aspects of Sanders’ networking strategy. First, what is the structure of the network
surrounding the Excardia venture. What kind of people does Sanders bring into the network, and why?
Second, what is Sanders’ role within the network. Why is he so seemingly invaluable?

Learning objectives for session:

1. Identify examples within the case study of how entrepreneurs uses social networks to create
economic value.
2. Identify key business dynamics within the medical device industry and correctly draw conclusions as
to the relative attractiveness of this industry to entrepreneurs.
3. Demonstrate critical thinking techniques within the context of an in-class oral discussion of
bioscience business processes.
4. Drawing upon the Uzzi article on social networks and the in-class discussion of key tactics used by
the entrepreneur Jerry Sanders to create value through using social networks, reflect on the
transferability of these tactics to other individuals.

Study questions:

1. What are the key characteristics of the medical device industry (see case exhibit 4)?
2. Make a list of Sanders’ personal characteristics. In your opinion, how much of Sanders’ success
can be tied to “unique” traits held by Sanders, and how much can be “learned” as a skill?
3. In discussing his employment within the Shaw group, Sanders states that his mindset is focused
on “completing transactions” compared to Shaw, who is “focused on building products and
companies.” What does Sanders mean by this? One interpretation of this statement is that
entrepreneurship should be defined through a ‘transactional’ lens. Do you agree with this
statement?
4. X-Cardia is to a large extent driven by entrepreneurial networks. On a blank sheet of paper, try
and construct a network diagram illustrating the ties between various participants in the X-
Cardia venture. Be sure to bring this network diagram to class.
5. Why, in your opinion, was the X-Cardia venture successful?
6. What is the opportunity presented by San Francisco Science (note: there is not a lot of
information on this in the case; you’ll have to use your intuition and knowledge of Sanders’
previous ventures). Would you invest in San Francisco Science? Why or why not?