Advantages provided to small and medium-sized enterprises through cooperation networking in the context of venture capital

The association of companies in cooperation networks arises as an alternative strategy to cope with the increase of competition brought by globalization. Several authors (Casarotto & Pires, 1999; Fayard, 2000; Jarillo, 1988; Marcon & Moinet, 2001) point out the advantages Small and Medium-sized Enterprises [SME] obtain from networking. The venture capital investment model [VC] appears as a networking alternative. In Brazil, VC began in the 80's. Therefore, this article aims to identify the motivations and advantages that SMEs obtain when they join a network. In this context, networking would be aiming at attaining strategic advantages. Structured interviews with VC and appointed companies' managers were conducted. The results have shown that companies' acceptance of this type of networking usually takes place due to capital costs. Later, the advantages are recognized, such as the exchange of information, improved processes, expertise in obtaining financing and the governance process. We conclude that literature on networking advantages applies to VC, although there are only a few studies in Brazil concerning this relationship. Thus, we propose the development of a better understanding of the concepts and advantages of this kind of networking so that this theme can be further studied academically.