Abstract
Drawing on self-determination theory (SDT), this study examines differences in the motivation of backers to support cultural and commercial entrepreneurs through reward crowdfunding. We propose that backers of commercial campaigns are a community of early-customers motivated by the prospects of attractive product offerings, while backers of cultural projects constitute a distinct community motivated to support capital-constrained cultural entrepreneurs and connect with like-minded individuals. We use data from the largest German crowdfunding platform, Startnext, and analyze 2334 rewards from 225 cultural and commercial projects. Our results provide support for our hypotheses: Rewards involving price discounts matter particularly for backers of commercial projects and rewards that engage backers with their community matter more for cultural backers. Surprisingly, however, backers of cultural projects are not altruistic; they are no more likely than commercial backers to support campaigns selflessly in response to symbolic rewards.
Highlights
Reward crowdfunding allows entrepreneurs to tap a large number of potential backers and offer rewards such as new products or services, community activities, or thank-you letters in exchange for backers’ financial contributions
We set out to examine the motivation of backers to pledge for rewards in the distinct communities of cultural and commercial backers
Commercial backers appear as early-customers who search for good product deals
Summary
Reward crowdfunding allows entrepreneurs to tap a large number of potential backers and offer rewards such as new products or services, community activities, or thank-you letters in exchange for backers’ financial contributions. Crowdfunding research has started to address this by examining the motives of backers to provide funding for campaigns, with mixed results. Some studies find that backers are extrinsically motivated to engage in reward crowdfunding and pledge to pre-order products or to collect rewards (Gerber et al 2012; Lin et al 2014; Cholakova and Clarysse 2015). Other studies point to latent intrinsic backer motives such as altruism, the desire to have an impact on the project success or to be part of a community (Gerber et al 2012; André et al 2017; Kuppuswamy and Bayus 2017; Nielsen and Binder 2020). Backer motivation is considered as generalizable among crowd funders, with the assumption that they are a homogenous group of individuals (Allison et al 2015; Cholakova and Clarysse 2015)
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