Social media as a strategic capability for startups and the mediating role of social capital

    Atthaphon Mumi   Affiliation


Social media have been widely adopted in various organizations. The use of social media for achieving business sustainability and financial outcomes has been addressed in the literature. In the entrepreneurship context, social media have received great attention as the platforms can be one of the cost-effective marketing activities and knowledge accumulation. Despite existing evidence regarding the impacts of social media, the study of social media in the startup’s context is limited. Based on the dynamic capabilities perspective, this study relied on data from 128 startups in the emerging economy’s context to investigate the importance of social media for startups. Particularly, the results from PLS-SEM support the significant influence of social media as firm’s strategic capability toward performance. In addition, social capital consisting of three dimensions – cognitive, structural, and relational – has been found to mediate the direct association of social media strategic capability toward the startup performance. This study advances the social media research on entrepreneurship as well as the dynamic capabilities perspective to enhance the startup’s sustainability through enhanced performance. Especially, it encourages the application of social media with the indirect effect of social capital for startups.

Keyword : startup, performance, social media strategic capability, social media, social capital, entrepreneurship

How to Cite
Mumi, A. (2022). Social media as a strategic capability for startups and the mediating role of social capital. Business: Theory and Practice, 23(2), 302–312.
Published in Issue
Sep 5, 2022
Abstract Views
PDF Downloads
Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.


Ackaradejruangsri, P., Mumi, A., Rattanapituk, S., & Pakhunwanich, P. (2022). Exploring the determinants of young inclusive leadership in Thailand: Research taxonomy and theoretical framework. Journal of the Knowledge Economy, 1–28.

Adler, P. S., & Kwon, S.-W. (2002). Social capital: Prospects for a new concept. Academy of Management Review, 27(1), 17–40.

Ali-Hassan, H., Nevo, D., & Wade, M. (2015). Linking dimensions of social media use to job performance: The role of social capital. The Journal of Strategic Information Systems, 24(2), 65–89.

Arabeche, Z., Soudani, A., Brahmi, M., Aldieri, L., Vinci, C. P., & Abdelli, M. E. A. (2022). Entrepreneurial orientation, organizational culture and business performance in SMEs: Evidence from emerging economy. Sustainability, 14(9), 5160.

Asikhia, O. (2010). Customer orientation and firm performance among Nigerian small and medium scale businesses. International Journal of Marketing Studies, 2(1), 197.

Baig, U., Hussain, B. M., Meidute-Kavaliauskiene, I., & Davidavicius, S. (2022). Digital entrepreneurship: Future research directions and opportunities for new business model. Sustainability, 14(9), 5004.

Benson, D., & Ziedonis, R. H. (2009). Corporate venture capital as a window on new technologies: Implications for the performance of corporate investors when acquiring startups. Organization Science, 20(2), 329–351.

Bharati, P., Zhang, W., & Chaudhury, A. (2015). Better knowledge with social media? Exploring the roles of social capital and organizational knowledge management. Journal of Knowledge Management, 19(3), 100–140.

Bocken, N. M., & Geradts, T. H. (2020). Barriers and drivers to sustainable business model innovation: Organization design and dynamic capabilities. Long Range Planning, 53(4), 101950.

Bodlaj, M., & Čater, B. (2019). The impact of environmental turbulence on the perceived importance of innovation and innovativeness in SMEs. Journal of Small Business Management, 57, 417–435.

Brunner, M., & Süβ, H.-M. (2005). Analyzing the reliability of multidimensional measures: An example from intelligence research. Educational and Psychological Measurement, 65(2), 227–240.

Bucher, T. (2015). Networking, or what the social means in social media. Social Media + Society, 1(1).

Bughin, J., Byers, A. H., & Chui, M. (2011). How social technologies are extending the organization. McKinsey Quarterly, 20(11), 1–10.

Carlson, J., Rahman, M., Voola, R., & De Vries, N. (2018). Customer engagement behaviours in social media: Capturing innovation opportunities. Journal of Services Marketing, 32(1).

Carlson, K. D., & Herdman, A. O. (2012). Understanding the impact of convergent validity on research results. Organizational Research Methods, 15(1), 17–32.

Cassar, G. (2014). Industry and startup experience on entrepreneur forecast performance in new firms. Journal of Business Venturing, 29(1), 137–151.

Chen, H.-T., & Li, X. (2017). The contribution of mobile social media to social capital and psychological well-being: Examining the role of communicative use, friending and self-disclosure. Computers in Human Behavior, 75, 958–965.

Chen, Z. F., Ji, Y. G., & Men, L. R. (2017). Strategic use of social media for stakeholder engagement in startup companies in China. International Journal of Strategic Communication, 11(3), 244–267.

Claridge, T. (2018). Dimensions of social capital-structural, cognitive, and relational. Social Capital Research, 1, 1–4.

Eisenhardt, K. M., & Martin, J. A. (2000). Dynamic capabilities: What are they? Strategic Management Journal, 21(10–11), 1105–1121.<1105::AID-SMJ133>3.0.CO;2-E

Ewens, M., & Marx, M. (2018). Founder replacement and startup performance. The Review of Financial Studies, 31(4), 1532–1565.

Fischer, E., & Reuber, A. R. (2011). Social interaction via new social media: (How) can interactions on Twitter affect effectual thinking and behavior? Journal of Business Venturing, 26(1), 1–18.

Fornell, C., & Larcker, D. F. (1981). Structural equation models with unobservable variables and measurement error: Algebra and statistics. Journal of Marketing, 18(3), 382–388.

Gao, H., Tate, M., Zhang, H., Chen, S., & Liang, B. (2018). Social media ties strategy in international branding: An application of resource-based theory. Journal of International Marketing, 26(3), 45–69.

Gloor, P. A., Colladon, A. F., Grippa, F., Hadley, B. M., & Woerner, S. (2020). The impact of social media presence and board member composition on new venture success: Evidences from VC-Backed U.S. startups. Technological Forecasting and Social Change, 157, 120098.

Gopalakrishnan, S., Scillitoe, J. L., & Santoro, M. D. (2008). Tapping deep pockets: The role of resources and social capital on financial capital acquisition by biotechnology firms in biotech–pharma alliances. Journal of Management Studies, 45(8), 1354–1376.

Hair, J., Black, W., Babin, B., Anderson, R., & Tatham, R. (2009). Multivariate data analysis. Pearson Education.

Hair, J. F., Sarstedt, M., Pieper, T. M., & Ringle, C. M. (2012a). The use of partial least squares structural equation modeling in strategic management research: A review of past practices and recommendations for future applications. Long Range Planning, 45(5–6), 320–340.

Hair, J. F., Sarstedt, M., Ringle, C. M., & Mena, J. A. (2012b). An assessment of the use of partial least squares structural equation modeling in marketing research. Journal of the Academy of Marketing Science, 40(3), 414–433.

Hair, J. F., Hult, G. T. M., Ringle, C. M., Sarstedt, M., & Thiele, K. O. (2017a). Mirror, mirror on the wall: A comparative evaluation of composite-based structural equation modeling methods. Journal of the Academy of Marketing Science, 45(5), 616–632.

Hair, J. F., Matthews, L. M., Matthews, R. L., & Sarstedt, M. (2017b). PLS-SEM or CB-SEM: Updated guidelines on which method to use. International Journal of Multivariate Data Analysis, 1(2), 107–123.

Hair, J. F., Risher, J. J., Sarstedt, M., & Ringle, C. M. (2019). When to use and how to report the results of PLS-SEM. European Business Review, 31(1).

Hair, J. F., Hult, G. T. M., Ringle, C. M., & Sarstedt, M. (2021a). A primer on partial least squares structural equation modeling (PLS-SEM). Sage Publications.

Hair, J. F., Hult, G. T. M., Ringle, C. M., Sarstedt, M., Danks, N. P., & Ray, S. (2021b). Mediation analysis. In Partial Least Squares Structural Equation Modeling (PLS-SEM) Using R: A workbook (pp. 139–153). Springer.

Hamilton, M., Kaltcheva, V. D., & Rohm, A. J. (2016). Social media and value creation: The role of interaction satisfaction and interaction immersion. Journal of Interactive Marketing, 36, 121–133.

Hanna, R., Rohm, A., & Crittenden, V. L. (2011). We’re all connected: The power of the social media ecosystem. Business Horizons, 54(3), 265–273.

Hasan, S., & Koning, R. (2019). Prior ties and the limits of peer effects on startup team performance. Strategic Management Journal, 40(9), 1394–1416.

Henseler, J., Ringle, C. M., & Sarstedt, M. (2015). A new criterion for assessing discriminant validity in variance-based structural equation modeling. Journal of the Academy of Marketing Science, 43(1), 115–135.

Hu, L.-t., & Bentler, P. M. (1999). Cutoff criteria for fit indexes in covariance structure analysis: conventional criteria versus new alternatives. Structural Equation Modeling: A Multidisciplinary Journal, 6(1), 1–55.

Huang, J., Newell, S., Huang, J., & Pan, S.-L. (2014). Site-shifting as the source of ambidexterity: Empirical insights from the field of ticketing. The Journal of Strategic Information Systems, 23(1), 29–44.

Jin, F., Wu, A., & Hitt, L. (2017). Social is the new financial: How startup social media activity influences funding outcomes. Academy of Management Annual Proceedings, 2017(1), 13329.

Kaplan, A. M., & Haenlein, M. (2010). Users of the world, unite! The challenges and opportunities of social media. Business Horizons, 53(1), 59–68.

Kemp, S. (2020). Digital 2020: Thailand.

Kenny, B., & Fahy, J. (2011). Network resources and international performance of High Tech SMEs. Journal of Small Business and Enterprise Development, 18(3).

Kumar, V., & Mirchandani, R. (2012). Increasing the ROI of social media marketing. MIT Sloan Management Review, 54(1), 55.

Lamberton, C., & Stephen, A. T. (2016). A thematic exploration of digital, social media, and mobile marketing: Research evolution from 2000 to 2015 and an agenda for future inquiry. Journal of Marketing, 80(6), 146–172.

Li, F., Larimo, J., & Leonidou, L. C. (2021). Social media marketing strategy: Definition, conceptualization, taxonomy, validation, and future agenda. Journal of the Academy of Marketing Science, 49(1), 51–70.

Lindner, J. R., Murphy, T. H., & Briers, G. E. (2001). Handling nonresponse in social science research. Journal of Agricultural Education, 42(4), 43–53.

Liu, C.-H. S. (2018). Examining social capital, organizational learning and knowledge transfer in cultural and creative industries of practice. Tourism Management, 64, 258–270.

Madsen, V. T., & Johansen, W. (2019). A spiral of voice? When employees speak up on internal social media. Journal of Communication Management, 23(4), 331–347.

Manley, S. C., Hair, J. F., Williams, R. I., & McDowell, W. C. (2021). Essential new PLS-SEM analysis methods for your entrepreneurship analytical toolbox. International Entrepreneurship and Management Journal, 17(4), 1805–1825.

Masters, B., & Thiel, P. (2014). Zero to One: Notes on startups, or how to build the future. Random House.

Maurer, I., & Ebers, M. (2006). Dynamics of social capital and their performance implications: Lessons from biotechnology start-ups. Administrative Science Quarterly, 51(2), 262–292.

Mei, M. Q., & Genet, C. (2022). Social media entrepreneurship: A study on follower response to social media monetization. European Management Journal.

Michaelidou, N., Siamagka, N. T., & Christodoulides, G. (2011). Usage, barriers and measurement of social media marketing: An exploratory investigation of small and medium B2B brands. Industrial Marketing Management, 40(7), 1153–1159.

Mumi, A., Ciuchta, M. P., & Yang, Y. (2018). Social media for entrepreneurial opportunity and process: An effectuation perspective. Academy of Management Annual Proceedings, 2018(1), 15826.

Mumi, A., Obal, M., & Yang, Y. (2019). Investigating social media as a firm’s signaling strategy through an IPO. Small Business Economics, 53(3), 631–645.

Mumi, A. (2020). Effectual entrepreneur and the use of social media for opportunity recognition. In L. Schjodt, M. Brannback, & A. Casrud (Eds), Understanding social media and entrepreneurship (pp. 49–67). Springer.

Nahapiet, J., & Ghoshal, S. (1998). Social capital, intellectual capital, and the organizational advantage. Academy of Management Review, 23(2), 242–266.

Naylor, R. W., Lamberton, C. P., & West, P. M. (2012). Beyond the “Like” button: The impact of mere virtual presence on brand evaluations and purchase intentions in social media settings. Journal of Marketing, 76(6), 105–120.

Netemeyer, R. G., Bearden, W. O., & Sharma, S. (2003). Scaling procedures: Issues and applications. Sage Publications.

Ngammoh, N., Mumi, A., Popaitoon, S., & Issarapaibool, A. (2021a). Enabling social media as a strategic capability for SMEs through organizational ambidexterity. Journal of Small Business & Entrepreneurship, 1–21.

Ngammoh, N., Mumi, A., Popaitoon, S., & Issarapaibool, A. (2021b). Social media strategic capability and the distribution on innovation performance for High-Tech SMEs. Journal of Distribution Science, 19(8), 37–46.

Nguyen, B., Yu, X., Melewar, T., & Chen, J. (2015). Brand innovation and social media: Knowledge acquisition from social media, market orientation, and the moderating role of social media strategic capability. Industrial Marketing Management, 51, 11–25.

Olanrewaju, A.-S. T., Hossain, M. A., Whiteside, N., & Mercieca, P. (2020). Social media and entrepreneurship research: A literature review. International Journal of Information Management: The Journal for Information Professionals, 50(C), 90–110.

Parida, D. K., & Prasanna, D. (2021). An empirical study on social media conversation to increase brand awareness: Startup organization context. Academy of Marketing Studies Journal, 25(4), 1–8.

Payne, G. T., Moore, C. B., Griffis, S. E., & Autry, C. W. (2011). Multilevel challenges and opportunities in social capital research. Journal of Management, 37(2), 491–520.

Podsakoff, P. M., MacKenzie, S. B., Lee, J.-Y., & Podsakoff, N. P. (2003). Common method biases in behavioral research: A critical review of the literature and recommended remedies. Journal of Applied Psychology, 88(5), 879–903.

Rheingold, H. (2000). The virtual community, revised edition: Homesteading on the electronic frontier. MIT Press.

Ringle, C. M., Sarstedt, M., & Straub, D. W. (2012). Editor’s comments: A critical look at the use of PLS-SEM in “Mis Quarterly”. MIS Quarterly, 36(1), iii-xiv.

Rogelberg, S. G., & Stanton, J. M. (2007). Introduction: Understanding and dealing with organizational survey nonresponse. Organizational Research Methods, 10(2), 195–209.

Salamzadeh, A., & Tajpour, M. (2021). Identification of the challenges of media startup creation in Iran. Journal of Entrepreneurship Development, 13(4), 561–580.

Schjoedt, L., Brännback, M. E., & Carsrud, A. L. (2020). Understanding social media and entrepreneurship: The business of hashtags, likes, tweets and stories. Springer Nature.

Skala, A. (2019). The startup as a result of innovative entrepreneurship. In Digital startups in transition economies. Palgrave Pivot.

Slávik, Š., Hudáková, I. M., Procházková, K., & Zagoršek, B. (2022). Strategic background of the start-up – qualitative analysis. Administrative Sciences, 12(1), 17.

Sosik, J. J., Kahai, S. S., & Piovoso, M. J. (2009). Silver bullet or voodoo statistics? A primer for using the partial least squares data analytic technique in group and organization research. Group & Organization Management, 34(1), 5–36.

Streukens, S., & Leroi-Werelds, S. (2016). Bootstrapping and PLS-SEM: A step-by-step guide to get more out of your bootstrap results. European Management Journal, 34(6), 618–632.

Szarek, J., & Piecuch, J. (2018). The Importance of startups for construction of innovative economies. International Entrepreneurship Review, 4(2), 69–78.

Teece, D., & Pisano, G. (2003). The dynamic capabilities of firms. In Handbook on knowledge management (pp. 195–213). Springer.

Teece, D. J., Pisano, G., & Shuen, A. (1997). Dynamic capabilities and strategic management. Strategic Management Journal, 18(7), 509–533.<509::AID-SMJ882>3.0.CO;2-Z

Teece, D. J. (2007). Explicating dynamic capabilities: The nature and microfoundations of (sustainable) enterprise performance. Strategic Management Journal, 28(13), 1319–1350.

Theodoraki, C., Messeghem, K., & Rice, M. P. (2018). A social capital approach to the development of sustainable entrepreneurial ecosystems: An explorative study. Small Business Economics, 51(1), 153–170.

Wang, D., Tsui, S., Zhang, Y., & Ma, L. (2003). Employment relationships and firm performance: Evidence from an emerging economy. Journal of Organizational Behavior, 24(5), 511–535.

Watts, S. A., & Zhang, W. (2008). Capitalizing on content: Information adoption in two online communities. Journal of the Association for Information Systems, 9(2), 3.

Wenger, E. (1999). Communities of practice: Learning, meaning, and identity. Cambridge University Press.

Willaby, H. W., Costa, D. S., Burns, B. D., MacCann, C., & Roberts, R. D. (2015). Testing complex models with small sample sizes: A historical overview and empirical demonstration of what Partial Least Squares (PLS) can offer differential psychology. Personality and Individual Differences, 84, 73–78.

Zahra, S. A. (2021). The resource-based view, resourcefulness, and resource management in startup firms: A proposed research agenda. Journal of Management, 47(7).

Zhang, F., & Zhu, L. (2021). Social media strategic capability, organizational unlearning, and disruptive innovation of SMEs: The moderating roles of tmt heterogeneity and environmental dynamism. Journal of Business Research, 133(C), 183–193.

Zwass, V. (2010). Co-creation: Toward a taxonomy and an integrated research perspective. International Journal of Electronic Commerce, 15(1), 11–48.