Extrinsic Motivation toward Entrepreneurs’ Intention to Adopt Crowdfunding: The Case of Kiva Lending Crowdfunding

Abstract

The adoption of crowdfunding among entrepreneurs has increased recently, and several factors are believed to contribute to this increase. Surprisingly, extrinsic motivating factors' effect on this increased crowdfunding adoption trend is inadequately addressed. The study investigates the effect of extrinsic motivators on entrepreneurs' intention to adopt crowdfunding in Tanzania. It applies Partial Least Squares-based Structural Equation Modelling to examine the effect of the need for achievement, social networking, and the desire for financial power on entrepreneurs' intention to adopt crowdfunding. Using a sample of 241 entrepreneurs operating in Tanzania, the results indicate that the need for achievement and the desire for financial power influence entrepreneurs' crowdfunding intention. We observe no effect of the need for social networking on entrepreneurs' crowdfunding intention. These results imply that an entrepreneur's intention to borrow through a crowdfunding platform aligns more with the need for achievement and the desire for financial power rather than the need for social networking.