Exploring Success Factors in Indonesian Equity Crowdfunding

Abstract

MSMEs contributed about 60 percent to the Indonesian GDP in 2019. With the development of Fintech, Equity Crowdfunding (ECF) has been seen as potential alternative financing for startups and SMEs in nurturing entrepreneurial ecosystems. This research examines the relationship between success factors of equity crowdfunding using data from the equity crowdfunding platforms in Indonesia. This study uses the Spearman Correlation test to examine the relationship of the factors with the amount raised. The result shows that the number of investors, the target of funds, minimum of investment, understandability, and provision of the video has a significant and positive effect on the equity crowdfunding success in Indonesia. This study also found that social media networks and projected rate of return negatively and significantly correlate with the success of Indonesian equity crowdfunding.