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Crowd‐funding: transforming customers into investors through innovative service platforms

Andrea Ordanini (Department of Marketing, Bocconi University, Milan, Italy)
Lucia Miceli (Department of Marketing, Bocconi University, Milan, Italy)
Marta Pizzetti (Department of Marketing, Bocconi University, Milan, Italy)
A. Parasuraman (Department of Marketing, University of Miami School of Business, Coral Gables, Florida, USA)

Journal of Service Management

ISSN: 1757-5818

Article publication date: 9 August 2011




The purpose of this paper is to analyze the emerging crowd‐funding phenomenon, that is a collective effort by consumers who network and pool their money together, usually via the internet, in order to invest in and support efforts initiated by other people or organizations. Successful service businesses that organize crowd‐funding and act as intermediaries are emerging, attesting to the viability of this means of attracting investment.


The research employs a “grounded theory” approach, performing an in‐depth qualitative analysis of three cases involving crowd‐funding initiatives: SellaBand in the music business, Trampoline in financial services, and Kapipal in non‐profit services. These cases were selected to represent a diverse set of crowd‐funding operations that vary in terms of risk/return for the investor and the type of payoff associated to the investment.


The research addresses two research questions: how and why do consumers turn into crowd‐funding participants? and how and why do service providers set up a crowd‐funding initiative? Concerning the first research question, the authors' findings reveal purposes, characteristics, roles and tasks, and investment size of crowd‐funding activity from the consumer's point of view. Regarding the second research question, the authors' analysis reveals purposes, service roles, and network effects of crowd‐funding activity investigated from the point of view of the service organization that set up the initiative.

Practical implications

The findings also have implications for service managers interested in launching and/or managing crowd‐funding initiatives.


The paper addresses an emerging phenomenon and contributes to service theory in terms of extending the consumer's role from co‐production and co‐creation to investment.



Ordanini, A., Miceli, L., Pizzetti, M. and Parasuraman, A. (2011), "Crowd‐funding: transforming customers into investors through innovative service platforms", Journal of Service Management, Vol. 22 No. 4, pp. 443-470.



Emerald Group Publishing Limited

Copyright © 2011, Emerald Group Publishing Limited

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