Foundations Of Statistics

While equity crowdfunding provides ventures with an opportunity to collect funding from a large base of investors, many campaigns tend to remain unsuccessful. We draw from two fields of financing adjacent to equity crowdfunding, venture capital (VC) and angel investing, as well as rewards-based crowdfunding, to develop an understanding of the drivers of investment decisions in equity crowdfunding. Using data from a leading equity crowdfunding platform in Northern Europe, we explore factors that drive the number of investors and amount of funding attracted by equity crowdfunding campaigns. The results suggest that the investment decision criteria traditionally used by VCs or business angels are not of prime importance for success in equity crowdfunding. Instead, success is related to pre-selected crowdfunding campaign characteristics and the utilization of private and public networks. The findings are relevant for the decision making of entrepreneurs and crowdfunding platforms, as both parties benefit from campaign success. Many crowdfunding campaigns tend to remain unsuccessful.We develop an understanding of the success drivers underlying equity crowdfunding campaigns.We find that the criteria used by VCs or business angels are not of prime importance for success in equity crowdfunding.Success is instead related to pre-selected crowdfunding campaign features and the utilization of private and public networks.The findings can support the decision making of entrepreneurs and crowdfunding platforms, as both aim for campaign success.

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Success drivers of online equity crowdfunding campaigns

Persuasion in crowdfunding: An elaboration likelihood model of crowdfunding performance

Crowdfunding has become important in recent years. However, there is no comprehensive overview of the economic literature on this topic. This paper provides an overview of crowdfunding literature, classified in terms of the main actors (capital seekers, capital providers, and intermediaries), and presents important research questions for future research.

Crowdfunding: A Literature Review and Research Directions

Interactions between project creators and backers on the crowdfunding platform represent the linchpin of every campaign. However, the resulting internal social capital has received little academic ...

The Influence of Internal Social Capital on Serial Creators’ Success in Crowdfunding

Venture financing through social networks has become a global phenomenon. The processes and drivers of crowdfunding require careful study to identify similarities and distinctions from traditional venture finance. The demonstration of project legitimacy is especially interesting because online crowdfunding limits investors' access to the entrepreneur and organisation. How do rewards-based crowdfunding projects establish and demonstrate legitimacy in this virtual, impersonal context? We employ a novel data-set collected from the Kickstarter crowdfunding platform to explore the characteristics of successful projects, including legitimating signals and content. The data reveal numerous findings linking project characteristics to legitimacy and success. First, lower funding targets and shorter duration signal legitimacy by setting modest, achievable expectations. Rewards structures, such as traditional equity investment terms, appear to generate a sense of legitimate investment returns. Finally, narrative leg...

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Exploring entrepreneurial legitimacy in reward-based crowdfunding

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Word of Mouth Theory Revisited: the Influence of New Actors on Seeding Campaigns

This study provides a more detailed account of online WOM by examining the relationship between marketers and tech-bloggers in the consumer electronics sector. Tech-bloggers are found to be a socially embedded entity involved in constant and multichannel interactions with other bloggers, their audience and marketers. This collaboration extends beyond seeding campaigns and has implications for how we model online WOM.

Beyond Giving Product Advice: Exploring Credibility Mechanisms of Technology Discourse in Electronic Word of Mouth Communication.

Existing marketing literature within the electronic Word of Mouth (eWOM) research stream is not considering the unique characteristics and implications of social networking sites (SNS) as they derive from traditional Word of Mouth (WOM) characteristics as well. Exploring the role of eWOM within SNS will contribute to the academic understanding of what drives consumers to share information about products or services in this novel area, which then can be used to illustrate marketers in terms of how to communicate or influence their consumers.

Benjamin Koeck

Papers

Exploring entrepreneurial legitimacy in reward-based crowdfunding

Word of Mouth Theory Revisited: the Influence of New Actors on Seeding Campaigns

Beyond Giving Product Advice: Exploring Credibility Mechanisms of Technology Discourse in Electronic Word of Mouth Communication.

The role of electronic Word of Mouth within Social Networking Sites