Success Of Crowdfunding Campaigns Research Articles

Exploring the multi-sided nature of crowdfunding campaign success

Successful crowdfunding campaigns are multifaceted in nature and depend on marketing and organizational features. This study identifies the most appealing factors and analyzes the results through a multi-theory approach as follows. First, contrary to altruism and warm-glow giving theories, crowdfunding to support social impact projects does not perform well. Second, fixed campaigns, small-sized projects, and prolonged campaigns are more likely to be funded, in line with goal-setting theory. Additionally, the resource-based view of firms clarifies the importance of having large entrepreneurial teams. Further, narrative theories about persuasion and information processing provide insights into why detailed text descriptions are more persuasive than pitch videos. Finally, this study relies on social identity and signaling theories to illustrate the impressive role of social networks and discussion forums between fundraisers and backers for developing effective word-of-mouth. This paper also provides fundraisers with recommendations to building appealing campaigns.

Exploring Factors Influencing the Success of Crowdfunding Campaigns of Startups in Vietnam

Over the past years, crowdfunding has been known as an effective funding channel for startups, especially in developed countries such as the United States, the United Kingdom and Germany. Nowadays, along with the rise of startups in Vietnam, will crowdfunding be a fruitful funding channel? What are the success determinants for a crowdfunding campaign of startups in Vietnam? With the data from five most well-known crowdfunding platforms (CFP) in Vietnam, we explore the factors which are significant for the success of crowdfunding campaigns of startups. Besides, this article also shed lights on the prospects and challenges ofcrowdfunding in Vietnam and proposes some recommendations for parties participating in the crowdfundingsystem.

The Impact of Sentiment Orientations on Successful Crowdfunding Campaigns through Text Analytics

The sentiment implied in user generated content represents the authors' personality, attitude, education level and social status. In Crowdfunding, the sentimental factor of the text description may impact the backers' investment intention on the project. The authors study the textual description from the sentimental aspect on the pledge results by employing text mining. The study proves that positive sentiment in the blurb and detailed description promotes the successful campaigns while it should not contain any sentimental factor in title. The predictive analysis shows that the predictive accuracy can be improved 7% based on the baseline model after considering sentimental factors from 64.4% to 71.7%.

Does Crowdfunding Benefit Entrepreneurs and Venture Capital Investors?

Problem Definition: We study how a new development in entrepreneurship --- crowdfunding --- interacts with more traditional financing sources, such as venture capital (VC) and bank financing. Academic/Practical Relevance: While extant literature has mainly focused on predicting crowdfunding campaign outcomes and optimal campaign design, the broader questions of how crowdfunding affects entrepreneurs and how crowdfunding platforms fit in with traditional startup financing sources, such as banks and VCs, have received relatively little attention. Methodology: We model a bargaining game, with a moral-hazard problem between an entrepreneur and a bank, and a double-sided moral-hazard problem between the entrepreneur and a VC, with respect to their non-contractible efforts. Results: We decompose the economic value of crowdfunding into cash gains or losses, costs of bad investments avoided, and project-payoff probability update. This economic value is generally shared between entrepreneurs and investors, benefiting both. Moreover, crowdfunding can help to overcome the agency problems. However, crowdfunding can also harm the entrepreneur and the VC. Competition from other investors reduces value to VC investors, who may walk away from the deal entirely. This can hurt entrepreneurs who lose out on valuable VC operational expertise (operational support, access to supplier networks, etc.). Managerial Implications: The model provides a theoretical underpinning for recent empirical observations that some projects lose VC financing after successful crowdfunding campaigns. Our results complement earlier studies in Operations Management by demonstrating that the entrepreneurs' objectives are more complex than simply maximizing the payoffs from crowdfunding campaigns.

Crowdfunding and wine business: Some insights from Fundovino experience

This paper aims to achieve a deeper understanding of the opportunities offered by crowdfunding in the wine sector and offer some guidelines to entrepreneurs for running a successful campaign. For this purpose, a case study research that explores the experience of the first wine-dedicated crowdfunding platform, namely Fundovino, has been conducted. Multiple data sources were used, among which documents and archival data from the Fundovino website, an email interview to its management team and an on line questionnaire sent to a sample of projects’ funders. The results suggest that crowdfunding is ideally suited for the wine sector and that winemakers could exploit both the financial and marketing opportunities offered. According to our survey, the main motivations for funding projects are the willingness to support and interact with small winemakers and the fun of being involved first-hand. So, the creation of other wine-dedicated crowdfunding platforms may help raise awareness about crowdfunding and attract funders interested in projects related to the world of wine. Running a successful crowdfunding campaign requires a significant investment of time and the development of some specific skills by proponents. Indeed, these latter should also be supported by platforms and other actors through the provision of appropriate services.

And the crowd goes wild: examining a successful crowdfunding campaign

Synopsis This case explores the concept of crowdfunding by examining the background of the fundraising model in addition to the successful campaign, “Let’s Send Kids to Harvard: Vidal Scholarship Fund.” In this campaign, Brandon Stanton leveraged the large following of his photo blog, “Humans of New York,” to raise more than one million dollars for students in an inner-city middle school. The fundraiser received national attention and broke the record for the most contributors to a single campaign on the popular crowdfunding website, Indiegogo. Students are encouraged to think critically about what elements work together to create a successful crowdfunding campaign. Research methodology Secondary data were reviewed to provide a thorough review of the history of crowdfunding as well as to chronicle the events that led up to the successful crowdfunding campaign highlighted in the case study. Relevant courses and levels This case is appropriate for university marketing, social media, public relations, and entrepreneurship courses. This case has a difficulty level appropriate for sophomore-, junior-, or senior-level courses.

Effect of Social Media Connectivity on Success of Crowdfunding Campaigns

Raising funds successfully is crucial for a crowdfunding campaign. To make a campaign successful, it is important to publicize and promote it on a large scale over social media. So, this study investigates social media as a tool to promote, publicize and fetch funds for crowdfunding campaigns. Creator’s activities and connectivity with various social media platforms is examined to learn their impact on success. A model, based ontweet messages and other social media connectivity, is designed to predict the success outcome of a campaign. Proposed model works with 76.7% accuracy. This study confirms that social interaction and connectivity have a positive impact on the success of a campaign.

Milkmade Ice Cream: Running a Successful Crowdfunding Campaign

This case follows a young entrepreneur as she launches a crowdfunding campaign to expand her already-established craft ice cream company. The story reveals the several steps taken from the planning phase through execution of the online campaign. This case provides an opportunity for students to learn about the benefits and drawbacks of crowdfunding, both as a form of marketing a business as well as garnering capital for expansion of a small business. Excerpt UVA-M-0880 Rev. Jun. 10, 2015 MilkMade Ice Cream: Running A Successful Crowdfunding Campaign In 2009, Diana Hardeman launched MilkMade Ice Cream, a craft ice cream company. Residents of Manhattan and Brooklyn could subscribe to a delivery service and receive two pints a month for $ 30. The New York–based start-up churned small batches of super premium ice cream made from locally sourced, fresh ingredients. The company grew organically for several years and by 2013, Hardeman determined she was ready to expand. Crowdfunding offered an opportunity for both capital and visibility. Company Foundations . . .

Woohoo Tinkerbots! The Marketing Effect of Crowdfunding

Crowdfunding is increasingly gaining attention in theory and practice as a financing instrument for a variety of different projects. Besides fundraising, crowdfunding also serves as a marketing tool. To better understand this effect, we developed a teaching case based on an interview with the company Kinematics about their successful crowdfunding campaign “TinkerBots”. The multifaceted teaching case explains crowdfunding as a marketing tool by discussing the “4P” marketing mix (product, price, promotion, and placement). Our teaching case further familiarizes students with the basics of crowdfunding, including the different forms of crowdfunding and the risks and opportunities associated with crowdfunding. Our teaching case is designed for postgraduate or advanced undergraduate students of information systems and business administration, as well as for students pursuing Bachelor or Master level studies in economics or information science. It can also be used in practice-oriented MBA courses, where students analyze and solve real world business challenges.

A Great Time for Makers

LASER CUTTERS First up is laser cutting. Unlike 3D printers, which deposit material one layer at a time (an instance of additive manufacturing), laser cutters use a powerful laser to cut or engrave material (subtractive manufacturing). While laser cutting has been around for some years, your best bet as an independent maker to get access to one was to join a local hackerspace that already had one of these beauties. Not only were these devices heavy and expensive, they required complicated exhaust and ventilation systems. Recently, a successful crowdfunding campaign hatched the Glowforge “3D laser printer”– a laser cutting device targeted for home use by enthusiasts [Figure 1]. The laser isn’t as powerful as some of the larger systems (the basic model comes with a 40W laser while the pro model offers 45W). But this is likely adequate to cut and etch material such as acrylic, wood and leather. What is most exciting is that this is being designed with home use in mind. You still need to deal with fumes – external venting is a default but it also supports a filter attachment that obviates the need for ventilation. With cheap 3D printers, there have been several reported complaints of foul smelling fumes when used in closed spaces (inhaling the odor of plastic burning is likely never a good thing!). Time will tell how well these filtration solutions work in practice.

That’s Not What Happened! Sustaining Expectations Through Collective Storytelling.

From a cultural perspective, narratives are understood as the main mechanism through which actors legitimate novel ideas, practices or forms of organizing. On the one hand, narratives serve as a touchstone by which audiences confer legitimacy. On the other, narratives also set expectations, which in turn set the stage for future disappointments. Answering a call for a better understanding of how narratives are revised in order to maintain or regain legitimacy, I followed the journey of Double Fine - a small independent video game studio - over three turbulent years, from their launch of one of the very first highly successful crowdfunding campaigns to the delivery of the final product. From this longitudinal and qualitative case study, I develop a model of “collective storytelling” to explicate how expectations were sustained over time. In so doing, this paper explores the active role that audiences play in conferring and maintaining legitimacy, which had previously been undertheorized.

Crowdfunding as a formula for the financing of projects: an empirical analysis

Crowdfunding offers enormous possibilities for marketing and communication, given that it facilitates the circulation of new projects, generates audiences and creates a loyal social base. Nevertheless, experiences of crowdfunding can be diverse. The aims of this investigation are threefold; to analyse crowdfunding platforms in Spain by means of quantitative and qualitative research methods (descriptive and relational); carry out a comparative study of the efficiency index of crowdfunding campaigns for profit-making projects as compared with campaigns raising money for social causes; and to propose good practice guidelines listing the key points of a successful campaign. The results obtained indicate that the percentage of successful profit-making campaigns is no higher than that for charitable ones, and that compliance with the key points in the proposed good practice guidelines is more likely to result in a successful crowdfunding campaign.

The Anatomy of a Successful Crowdfunding Campaign Page

New ventures must overcome various information asymmetries in their quest to acquire financial resources. Extensive research has shown that entrepreneurs attempt to do this is by signaling pertinen...

Community Impact on Crowdfunding Performance

Many digital platforms, regardless of their business domain, follow the common practice of incorporating social and community features in order to increase their user engagement and expand their online community. Although this practice is advocated by the literature and clearly makes sense, its implications are not well understood. In this research, we aimed to close this literature gap, providing a theoretical framework and empirical evidence regarding the impact of the online community on platform performance. As a testbed, we studied crowdfunding platforms, that is, designated websites aimed at enabling entrepreneurs to raise money over the Internet. We used comprehensive data collected from Kickstarter, the largest crowdfunding platform established to date.We theorized that online platforms, such as Kickstarter, consist not of a single community but rather a hierarchy of multiple, partially competing communities. These communities vary considerably with respect to the interests of their members, their platform participation patterns, and their impact on platform performance. Our suggested framework incorporates the notion of fluidity of online communities; that is, online users and digital communities evolve and change over time. As the interests of the online user change, so does the membership of her immediate community. The proposed framework allows us to identify such community changes and, consequently, to better identify pivotal members of online communities and predict their lifetime value as potential backers.Empirically, we validated our theory by studying the participation patterns of over 6.3 million Kickstarter users, who have supported more than 150 thousand crowdfunding campaigns over more than 5 years. We demonstrated the growth of the different community types and estimated their different impacts on crowdfunding performance over time. Interestingly, we found that some communities, despite high participation rates, had negative impacts on crowdfunding campaign success. We discuss managerial and practical implications of our theory and findings.

Trends in the crowdfunding of educational technology startups

This article presents an analysis of active crowdfunding campaigns posted on ten crowdfunding platforms in May 2013 to provide a glimpse of the recent trends in the crowdfunding of educational technology startups. We describe the characteristics of the most successful crowdfunding campaigns in educational technology and identify the most popular crowdfunding platforms. This research provides important implications for educational technology entrepreneurs. Top performing educational technology fund raisers tend to a) request a modest but reasonable amount for each phase of the project, b) focus on the informal, out-of-school, rather than formal contexts of learning, c) attract supporters with a tiered system of rewards, and d) communicate with supporters and inform the public of the status of the project through periodic updates and progress reports. Directions for future research include conducting an in-depth content analysis of archived data and exploring the perspectives of successful educational technology entrepreneurs using qualitative interviews.

How Can Social Enterprises Develop Successful Crowdfunding Campaigns? An Empirical Analysis on Italian Context

Crowdfunding has been recognized by media narrations as a disruptive approach to funding social entrepreneurship while there is a lack of evidence in academic literature about those factors that are able to support social entrepreneurs in developing successful CrowdFunding (CF) campaigns. This paper is aimed to improve academic knowledge on those elements that can effectively support social entrepreneurs in managing their campaigns. An empirical analysis on 250 CF campaigns launched by Italian social enterprises was carried out. We focus on the effect on the overall funding level achieved of three main type of issues: the social enterprise’s network, the choice of CF platform, and the CF campaign’s design. Our results show how the social enterprise’s presence on Twitter, the choice of a specific reward-based platform, and an active management of the CF campaign have a significant impact on the achievement of the funding goal.

Environmental Monitoring?s Image Problem

Earlier this year the scientific world was shocked by the revelation that the famous Keeling Curve may come to an end due to lack of funding. The curve is the result of 56 years of continuous atmospheric monitoring of carbon dioxide, initially in Hawaii by Charles David Keeling and more recently by the Scripps Institute of Oceanography at the University of California San Diego. The data provided convincing evidence of carbon dioxide’s role in global warming and will be essential in assessing the success of mitigation strategies. After a heartfelt plea from Ralph Keeling, the project was saved, at least temporarily, thanks to a mixture of private and government funds and a successful crowd funding campaign. The plight of the project highlights the fragility and importance of long-term environmental monitoring. In a recent editorial, I lamented the lack of environment data for the New York City area which hampered our ability to draw concrete conclusions from data obtained following Hurricane Sandy. I contrasted this to the recent completion of a forty year project by the British Geological Survey which resulted in a comprehensive map of several elements in the United Kingdom. Why are similar initiatives not occurring in the United States? The difficulty appears to be in securing necessary funds for monitoring projects which do not appear to offer a useful product or exciting innovations.

A process approach to harnessing crowd-sourcing for new product development

Small businesses face several difficulties in raising money for financing their new product development (NPD) efforts. This paper, through a case study, explores and examines the process of using crowd sourcing for financing NPD projects. We analyse the innovative steps taken by a small business to formulate and execute a successful crowd funding campaign. Crowd funding illustrated in this case as a NPD funding approach is a derivative of crowd sourcing. This approach if run successfully, can provide small businesses not only a chance to both display their ideas to their customers and supporters but also receive financial support from them for NPD through small contributions.

A simple process for precipitating the cotton contained in collodion

This study examines whether and how entrepreneurs' facial trustworthiness is associated with the success of their crowdfunding campaigns. We adopt a novel dataset extracted from the Kickstarter crowdfunding platform and employ machine learning-based facial detection techniques to construct a comprehensive index that measures facial trustworthiness for our investigation. Our results suggest that entrepreneurs' facial trustworthiness is positively associated with crowdfunding campaign success. Specifically, trustworthy-looking entrepreneurs receive a 13.1% greater pledge amount and attract 4.8% more backers in their crowdfunding campaign as compared to those who are untrustworthy-looking. We also find that the facial trustworthiness of female entrepreneurs plays a more prominent role in determining project success than that of male entrepreneurs. Our results are robust to a series of additional analyses and sensitivity checks. Overall, the results of our study suggest that entrepreneurs' facial trustworthiness is an important factor that affects funders' decision-making process in reward-based crowdfunding.