Abstract
Knowledge and guidance from peers, mentors, and an entrepreneur's support network are vital resources for the growth of small and early-stage ventures. Yet, our current understanding of how advice impacts entrepreneurial outcomes primarily stems from studies focusing on high-growth startups seeking venture capital funding to accelerate growth. However, do channels of advice benefit small businesses that lack the backing of venture capital in the same way? Additionally, we lack insight into how social place-based factors shape the influence of advice. To address these questions, we analyzed data from the New York State Small Business Development Center (SBDC), examining over 100,000 small businesses that received formal SBDC consultations between 2005 and 2022. Our findings reveal that increased consultation time with SBDC consultants leads to higher rates of startup creation and subsequent growth. However, this benefit is contingent on the concentration of both internal and external social capital within the nascent entrepreneur’s local community. A denser network of social connections within and across the focal community amplifies the positive effects of SBDC consultation. Bringing together the literatures on regional social networks, community embeddedness, and entrepreneurship advice, we contribute by explicating the relationship between place-based social capital and knowledge capital on the growth of small businesses.