From Single-Sided to Two-Sided: The Role of Experience and Networks in Venture Capital Law Firm Intermediation

Most theories of market intermediation focus on how established intermediaries with representation experience facilitate market transactions to create value. Little research has examined how young intermediaries gain such experience and carve out entrepreneurial opportunities to represent exchange parties. Using longitudinal data on 323 U.S.-based venture capital law firms that begin representing startups to secure financing, this study investigates how intermediaries leverage their initial experiences to develop dual-sided capabilities. We provide and find support for the argument that intermediaries can transition smoothly by developing transferable value on the sell-side (representing startups) and expanding their networks on the buy-side (representing venture capital firms). By drawing an analytical distinction between buy-side representation and sell-side representation in intermediation, this research presents two-sided intermediation as an evolving developmental process, emphasizing the critical role of experience and learning as catalysts for this evolution.