The Black Lives Matter movement and African American entrepreneurs’ crowdfunding success

Abstract

This paper examines two aspects of African American restauranteurs—their crowdfunding performance and how such performance has been impacted by the Black Lives Matter movement. More than any other racial group, African American entrepreneurs face challenges securing funds from conventional financial institutions. A welcome addition to the pool of fundraising sources is crowdfunding, a new fintech option. Using binomial logistic regression, we analyzed all of the restaurant crowdfunding projects on Kickstarter.com, dating from 2010 to 2020. Drawing on aversive racism theory and value-belief-norm theory, we uncovered the finding that restaurant crowdfunding projects with African American racial cues were significantly less successful getting funded than their non-African American counterparts. However, the Black Lives Matter movement and the Kickstarter’s endorsement of the movement have significantly increased African American restauranteurs’ crowdfunding success.