Search results

1 – 10 of 799
Article
Publication date: 15 August 2022

Ali Abdallah Alalwan, Abdullah M. Baabdullah, Joma Omran Mahfod, Paul Jones, Anshuman Sharma and Yogesh K. Dwivedi

The crowdfunding concept and activities have recently been the focus of attention of many researchers and practitioners over different business contexts. However, there is…

Abstract

Purpose

The crowdfunding concept and activities have recently been the focus of attention of many researchers and practitioners over different business contexts. However, there is a dearth of literature considering the main aspects of e-equity crowdfunding activities and their impact on the innovation performance for entrepreneurial business. Therefore, this study aims to explore how entrepreneurs' engagement in e-crowdfunding activities could enhance both knowledge acquisition and innovation performance.

Design/methodology/approach

The conceptual model will be proposed based on three main theoretical perspectives: relationship marketing orientation (RMO); Kirzner's alertness theory; and the DeLone and McLean model of information systems. The data of the current study were collected using an online questionnaire from a sample of 500 entrepreneurs who have actively engaged in e-crowdfunding in Saudi Arabia.

Findings

The statistical results of structural equation modelling (SEM) approved the impacting role of RMO, entrepreneurial alertness, system quality and service quality on the entrepreneurs' engagement in e-equity crowdfunding, which in turn, predicts both knowledge acquisition and innovation performance.

Research limitations/implications

There are several limitations which could be addressed in future studies, for example, this study has only considered one form of crowdfunding (equity based crowdfunding) and due to its nature these findings would not be easily generalized to other kinds of crowdfunding (i.e. donation-based crowdfunding; rewards-based crowdfunding; and debt-based crowdfunding). Future studies could consider these kinds of crowdfunding activities.

Originality/value

This study has contributed to the understanding of e-equity crowdfunding in several aspects. For example, this study presents results that assist both researchers and practitioners in the Middle East and Saudi Arabia to develop an in-depth knowledge of e-equity crowdfunding by considering new dimensions such as RMO and information system success factors.

Details

European Journal of Innovation Management, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 1460-1060

Keywords

Article
Publication date: 10 September 2021

Valentina Ndou, Paola Scorrano, Gioconda Mele and Pasquale Stefanizzi

The wide development of digital platforms permitted the birth of new financing modalities, namely, crowdfunding, where the crowd of individuals and investors can supply…

Abstract

Purpose

The wide development of digital platforms permitted the birth of new financing modalities, namely, crowdfunding, where the crowd of individuals and investors can supply the necessary financial resources for venture creation and growth. While the extant literature has focused on analyzing the dynamics and features of crowdfunding campaigns, few studies have focused on understanding how crowd investors decide which ventures to invest in and which factors influence their decision-making process. Due to this gap, the purpose of this paper is to analyze the factors influencing the choice to invest in an equity crowdfunding campaign, by defining a set of indicators useful to evaluate the risk of the campaign.

Design/methodology/approach

An empirical research study of Italian equity crowdfunding campaigns has been conducted to identify quantitative indicators useful for evaluating the risk in a crowdfunding campaign.

Findings

Findings demonstrate that the risk indicators proposed to represent important gauges that investors can usefully consider ex ante to assess the degree of riskiness of the investment in the equity crowdfunding campaign.

Research limitations/implications

The limitations of the study regarding the size of the sample that is small due to the necessity to extract enough information in pre and post-equity campaigns. Also, the lack of historical data is another limitation.

Originality/value

The originality of the studies relies on the proposal of quantitative indicators for the evaluation of the risk in equity crowdfunding campaigns for “crowd” investors to reduce information asymmetries.

Details

Meditari Accountancy Research, vol. 30 no. 4
Type: Research Article
ISSN: 2049-372X

Keywords

Open Access
Article
Publication date: 5 July 2021

Antonella Francesca Cicchiello, Amirreza Kazemikhasragh and Stefano Monferra

Women’s entrepreneurial activity can significantly impact economic and social development globally, particularly in developing countries. The significant challenges…

1194

Abstract

Purpose

Women’s entrepreneurial activity can significantly impact economic and social development globally, particularly in developing countries. The significant challenges entrepreneurial women face draw the attention of researchers and policymakers. This paper aims to analyse the impact of gender disparity on the likelihood of obtaining equity financing through crowdfunding. The equity crowdfunding industry was selected because it is a non-traditional financial market where gender bias may act differently for women.

Design/methodology/approach

To investigate the relationship between gender and equity financing through crowdfunding, this paper applies ordinary least squares regression. The analysis is based on a unique data set of 492 equity crowdfunding campaigns launched between 2013 and 2017 on all existing platforms in Brazil, Chile and Mexico.

Findings

The analysis reveals that the involvement of at least one woman on the board of firms seeking equity financing increases campaign success rates in terms of the investors’ average pledge, the target amount reached at the end of the campaign and the percentage raised at the end of the campaign exceeding the initial fundraising goal. Altogether, this suggests that equity crowdfunding campaigns should be based on gender equality in the firms’ boards. The research finds evidence that there is no gender disparity in the likelihood of a campaign being financed by a greater number of investors.

Practical implications

These findings have implications for Latin American female entrepreneurs when selecting funding sources and policymakers when defining political actions to remove the barriers at the root of this historic inequality in female entrepreneurs’ access to finance.

Originality/value

To the best of the authors’ knowledge, this document analyses the gender disparity in the Latin American equity crowdfunding market, shedding light on women’s access to crowdfunding financing for the first time.

Details

Gender in Management: An International Journal , vol. 36 no. 8
Type: Research Article
ISSN: 1754-2413

Keywords

Article
Publication date: 7 February 2020

Enrico Battisti, Fabio Creta and Nicola Miglietta

This paper gathers initial evidence about the nature and features of the equity crowdfunding model in Italy, especially in terms of regulations. The purpose of this study…

Abstract

Purpose

This paper gathers initial evidence about the nature and features of the equity crowdfunding model in Italy, especially in terms of regulations. The purpose of this study is to examine how equity crowdfunding might support the real estate sector in Italy.

Design/methodology/approach

To explore the recent initiatives in the development of FinTech in Italy, especially referring to equity crowdfunding’s instrument, a qualitative perspective is used. In particular, this paper relies on primary data from regulations and secondary data from the public domain, which are examined in relation to the current literature.

Findings

The results of this study show that equity crowdfunding represents a funding method that is rapidly increasing in Italy, despite rather rigid regulation. Among the various sectors involved, the real estate sector could benefit from the crowdfunding models and, specifically, from the equity one. The development of new real estate equity crowdfunding portals that allow diversification of investment (by reducing the typical entry barriers for real estate investment) could guarantee greater investment transparency and simplicity.

Practical implications

Real estate crowdfunding can be a simple way to invest in the real estate industry. Thanks to the use of technology, specifically internet-based platforms, this type of crowdfunding allows for small investors, as well as professional investors, to access an asset class otherwise not open to small investment tickets and improve the diversification of investments.

Originality/value

Although recent literature has examined the concept of crowdfunding and highlighted different models, aspects and campaigns, no prior studies, to the authors’ knowledge, have explicitly and jointly investigated, also based on the state of art of regulation, the equity crowdfunding model and the real estate sector in Italy.

Details

Journal of Financial Regulation and Compliance, vol. 28 no. 3
Type: Research Article
ISSN: 1358-1988

Keywords

Article
Publication date: 3 August 2015

Alexandra Moritz, Joern Block and Eva Lutz

This study’s aim is to investigate the role of investor communication in equity-based crowdfunding. The study explores whether and how investor communication can reduce…

5107

Abstract

Purpose

This study’s aim is to investigate the role of investor communication in equity-based crowdfunding. The study explores whether and how investor communication can reduce information asymmetries between investors and new ventures in equity-based crowdfunding, thereby facilitating the crowd’s investment decisions.

Design/methodology/approach

This paper follows an exploratory qualitative research approach based on semi-structured interviews with 23 market participants in equity-based crowdfunding: 12 investors, 6 new ventures and 5 third parties (mostly platform operators). After analyzing, coding and categorizing the data, this paper developed a theoretical framework and presented it in a set of six propositions.

Findings

The results indicate that the venture’s overall impression – especially perceived sympathy, openness and trustworthiness – is important to reduce perceived information asymmetries of investors in equity-based crowdfunding. To communicate these soft facts, personal communication seems to be replaced by pseudo-personal communication over the Internet (e.g. videos, investor relations channels and social media). In addition, the communications of third parties (e.g. other crowd investors, professional and experienced investors and other external stakeholders) influence the decision-making process of investors in equity-based crowdfunding. Third-party endorsements reduce the perceived information asymmetries and lower the importance of pseudo-personal communications by the venture.

Originality/value

Prior research shows that investor communication reduces information asymmetries between companies and investors. Currently, little is known about the role of investor communication in equity-based crowdfunding. This study focuses on the role of investor communication to reduce the perceived information asymmetries of investors in equity-based crowdfunding.

Details

Qualitative Research in Financial Markets, vol. 7 no. 3
Type: Research Article
ISSN: 1755-4179

Keywords

Open Access
Article
Publication date: 1 February 2022

Antonella Francesca Francesca Cicchiello and Amirreza Kazemikhasragh

Belonging to the financial technologies’ companies, equity-based crowdfunding platforms offer investors the opportunity to become shareholders through the purchase of…

Abstract

Purpose

Belonging to the financial technologies’ companies, equity-based crowdfunding platforms offer investors the opportunity to become shareholders through the purchase of small equity stakes of new innovative ventures. This paper aims to investigate gender-related differences in the behaviour of investors in firms seeking equity financing in Latin America.

Design/methodology/approach

Using a unique database, with combined information from different equity crowdfunding platforms in Brazil, Chile and Mexico, the authors study the population of 492 projects between 2013 and 2017. To analyse the relationship between investors’ gender-related differences and equity crowdfunding investment, this paper applies Poisson regression.

Findings

Results suggest that the probability that an investor finances a firm is based on gender bias. Investors prefer firms led by entrepreneurs that are similar to them in terms of gender. Furthermore, the authors find evidence that both female and male investors are risk-averse and are more likely to invest in the equity of firms that are older and offer a higher percentage of equity. However, female investors are associated with firms that are on average older and offer 0.02% more equity.

Practical implications

These findings have implications for crowdfunding platforms managers when selecting their target companies and policymakers when defining political actions to promote greater use of equity crowdfunding among female entrepreneurs and decrease barriers hindering women’s access to investment.

Originality/value

Unique in its proposition and data usage, this study sheds light on the relationship between investors and entrepreneurs in the Latin American equity crowdfunding market.

Details

European Business Review, vol. 34 no. 3
Type: Research Article
ISSN: 0955-534X

Keywords

Article
Publication date: 10 February 2021

Bree Dority, Sarah J. Borchers and Suzanne K. Hayes

This study aims to investigate how the language used in US Title II equity crowdfunding campaign descriptions relates to campaign success.

Abstract

Purpose

This study aims to investigate how the language used in US Title II equity crowdfunding campaign descriptions relates to campaign success.

Design/methodology/approach

Data on >3,200 equity offerings from 12 Title II platforms was obtained from 2013 to 2016. The aspects of the campaign descriptions that are focused on are tone and two measures of readability: information quantity – the amount of information available to the investor and information quality – the ease of understanding of the passage of text. Tobit regressions with sector-clustered standard errors are used for estimation while controlling for company-specific variables, market sentiment and platform, regional, sector and time effects. Results are robust to alternative estimation approaches.

Findings

Inverse U-shaped relationships exist between information quantity, information quality and tone and Title II equity crowdfunding campaign success. Overall, less is more as it appears that an intermediate level of information – quantity, quality and tone – is optimal in terms of being a factor that contributes to equity crowdfunding campaign success.

Originality/value

Extends the use of textual analysis to the equity crowdfunding environment in the USA where such analysis is lacking and provides empirical evidence that the language used (e.g. sentiment) in US Title II equity-based crowdfunding campaign descriptions does influence campaign success. It provides empirical evidence of and extends the concept of information overload to the entrepreneurial finance sub-field and indicates tone may be an additional information attribute to consider in this context as contributing to overload.

Details

Studies in Economics and Finance, vol. 38 no. 4
Type: Research Article
ISSN: 1086-7376

Keywords

Article
Publication date: 30 November 2020

Antonella Francesca Cicchiello, Amirreza Kazemikhasragh and Stefano Monferrà

The purpose of this paper aims to understand whether gender disparity has an impact on the likelihood of obtaining equity crowdfunding financing in Latin America.

Abstract

Purpose

The purpose of this paper aims to understand whether gender disparity has an impact on the likelihood of obtaining equity crowdfunding financing in Latin America.

Design/methodology/approach

The paper uses a unique database of 492 projects from different equity crowdfunding platforms in Latin America over a period of 2013–2017.

Findings

Results indicate that the involvement of at least one woman in the board of firms seeking equity financing increases campaigns' success significantly. Team gender has no impact on the project's likelihood to experience overfunding.

Originality/value

The paper sheds light on women's access to crowdfunding financing in Latin America, not yet considered so far.

Details

International Journal of Emerging Markets, vol. 17 no. 5
Type: Research Article
ISSN: 1746-8809

Keywords

Article
Publication date: 18 March 2019

Jordan Robert Gamble

The purpose of this paper is to explore the implementation of equity crowdfunding (ECF) within the record industry in terms of challenges and opportunities, in addition to…

Abstract

Purpose

The purpose of this paper is to explore the implementation of equity crowdfunding (ECF) within the record industry in terms of challenges and opportunities, in addition to the marketing and financial implications for independent music artists and major record labels.

Design/methodology/approach

This study adopted a qualitative methodology consisting of two-stage interview-based research methods. A total of 44 semi-structured in-depth interviews were conducted with the CEOs of ECF platforms in the record industry, other related record industry informants, independent artist managers and senior executives from major record labels.

Findings

The loyalty aspect of ECF may have significant marketing potential in terms of inconspicuously using the equity platform as a “prosumer” identification mechanism. As this early career stage of artists is delicate in terms of establishing trust and patronage from their fans, these early marketing and ECF ventures should be implemented directly from the artist without external third-party involvement.

Research limitations/implications

The implications of this paper’s findings and theoretical model are not limited to the two studied stakeholder groups of the record industry. The insights in relation to the obstinate lack of understanding and clarity (particularly for independent artists) which surround ECF are likely to influence short-term strategic approaches by other players throughout the wider music industry.

Practical implications

The insights regarding negative approaches towards ECF by the labels may influence future “coopetition strategies” for independent labels, as they seek to navigate the changing industry dynamics.

Originality/value

This paper is the first study to empirically explore the predominantly under-researched area of ECF implementation in the record industry in terms of marketing and financial consequences for artists and labels.

Details

European Journal of Marketing, vol. 53 no. 3
Type: Research Article
ISSN: 0309-0566

Keywords

Open Access
Article
Publication date: 31 March 2020

Giancarlo Giudici, Massimiliano Guerini and Cristina Rossi-Lamastra

The authors investigate whether matchings in equity crowdfunding are more likely to happen if homophily exists between investors and investees. They focus on gender, age…

1013

Abstract

Purpose

The authors investigate whether matchings in equity crowdfunding are more likely to happen if homophily exists between investors and investees. They focus on gender, age and geographical proximity as crucial dimensions of similarity among individuals and thus of homophily. Furthermore, they investigate whether the effect of homophily depends on the risk of opportunism, which investors allegedly attribute to proponents basing on their area of residence.

Design/methodology/approach

The authors analyze a hand-collected database of 13 equity crowdfunding campaigns launched by Italian innovative start-ups from January 2013 to June 2016, which includes information about 384 equity crowdfunding investments carried out by 361 different investors.

Findings

The authors find a significant effect of geographical proximity and age similarity in explaining the probability that an investor finances a campaign. Moreover, these effects are particularly relevant if the proponent is located in areas characterized by a high risk of opportunistic behavior. Interestingly enough, they do not detect any significant effect related to gender.

Originality/value

In this paper, the authors have the unique opportunity to analyze a whole market (the Italian market) during three years, from inception (2013–2016), and to collect the identities of the investors in all successful campaigns.

Details

Baltic Journal of Management, vol. 15 no. 2
Type: Research Article
ISSN: 1746-5265

Keywords

1 – 10 of 799