The narcissism of crowdfunding entrepreneurs

Abstract

Social networks and personality traits of the entrepreneur affect investors’ willingness to finance start-ups, particularly in reward-based crowdfunding where observable individual characteristics are paramount. We study the impact of crowdfunding entrepreneurs’ narcissism on campaign design and campaign outcome. We distinguish between the ego-defensive behavior and grandiose/arrogant behavior of narcissists in the hypotheses for campaign design. We find that more narcissistic crowdfunding entrepreneurs set less ambitious goals and longer campaign durations, consistent with ego-defensive behavior. We further document that more narcissistic entrepreneurs are less successful than other entrepreneurs, suggesting that crowdfunders recognize the narcissistic tendencies of entrepreneurs and are more reluctant to support them. Our results are consistent with recent conceptual research, suggesting that there are specific effects of narcissism in the early-stage entrepreneurial context.