This study explores how founder teams’ educational affiliations signal new venture quality to attract external funding, emphasizing the interaction between the hard signal and soft signal. Hard signal offers quantitative, easily verifiable information like school rank, while soft signal provides qualitative information like school reputation. Using U.S. News rankings for hard signal and school prominence based on school network constructed by cofounder ties for soft signals, we analyze how these signals help new ventures attract future fundings. Our findings show that both more positive hard signal and soft signal increase the likelihood of receiving funding, and a substitution effect exist between soft signal and hard signal. This research also introduces a novel framework to assess the signaling role of new ventures’ affiliations, offering insights into their impact on resource acquisition.
