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Influence of number of backers, goal amount, and project duration on meeting funding goals of crowdfunding projects

Author

Listed:
  • Srikant Devaraj

    (Center for Business and Economic Research, Miller College of Business, Ball State University)

  • Pankaj C Patel

    (Villanova School of Business, Villanova University)

Abstract

Evaluating potential of crowdfunding projects is challenging, and this challenge has multiplied with increasing number of projects in recent years. Using a sample of 74,618 Kickstarter crowdfunding projects and based on linear growth time-trend mixed-effects logit model, with increasing number of crowdfunding projects over time, fewer projects received funding, furthermore, number of backers reduced, higher goal amount increased and shorter duration to meet the funding goal increased the likelihood of achieving the funding goal. The results suggest that over time crowdfunding platforms increase reliance on costlier signals (higher goal amount and shorter duration) and reduce reliance on noisier signals (number of backers).

Suggested Citation

  • Srikant Devaraj & Pankaj C Patel, 2016. "Influence of number of backers, goal amount, and project duration on meeting funding goals of crowdfunding projects," Economics Bulletin, AccessEcon, vol. 36(2), pages 1242-1249.
    • Handle: RePEc:ebl:ecbull:eb-14-01063
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    References listed on IDEAS

    as
    1. Ajay Agrawal & Christian Catalini & Avi Goldfarb, 2014. "Some Simple Economics of Crowdfunding," Innovation Policy and the Economy, University of Chicago Press, vol. 14(1), pages 63-97.
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    4. Ajay K. Agrawal & Christian Catalini & Avi Goldfarb, 2011. "The Geography of Crowdfunding," NBER Working Papers 16820, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Maria Kukurba & Aneta Ewa Waszkiewicz & Mariusz Salwin & Andrzej Kraslawski, 2021. "Co-Created Values in Crowdfunding for Sustainable Development of Enterprises," Sustainability, MDPI, vol. 13(16), pages 1-21, August.
    2. Erik Ansink & Mark Koetse & Jetske Bouma & Dominic Hauck & Daan van Soest, 2017. "Crowdfunding public goods: An experiment," Tinbergen Institute Discussion Papers 17-119/VIII, Tinbergen Institute.
    3. Francisca Jiménez-Jiménez & Maria Virtudes Alba-Fernández & Cristina Martínez-Gómez, 2021. "Attracting the Right Crowd under Asymmetric Information: A Game Theory Application to Rewards-Based Crowdfunding," Mathematics, MDPI, vol. 9(21), pages 1-23, October.
    4. Warnick, Benjamin J. & Davis, Blakley C. & Allison, Thomas H. & Anglin, Aaron H., 2021. "Express yourself: Facial expression of happiness, anger, fear, and sadness in funding pitches," Journal of Business Venturing, Elsevier, vol. 36(4).
    5. Soudipta Chakraborty & Robert Swinney, 2021. "Signaling to the Crowd: Private Quality Information and Rewards-Based Crowdfunding," Manufacturing & Service Operations Management, INFORMS, vol. 23(1), pages 155-169, 1-2.
    6. Anton Miglo, 2022. "Theories of Crowdfunding and Token Issues: A Review," JRFM, MDPI, vol. 15(5), pages 1-28, May.
    7. Alexandre Garel & Benjamin Le pendeven, 2021. "Calendar effects and crowdfunded projects," Economics Bulletin, AccessEcon, vol. 41(3), pages 1407-1417.
    8. Alexandre Garel & Benjamin Le Pendeven, 2021. "Calendar effects and crowdfunded projects," Post-Print hal-03377772, HAL.
    9. Anglin, Aaron H. & Short, Jeremy C. & Drover, Will & Stevenson, Regan M. & McKenny, Aaron F. & Allison, Thomas H., 2018. "The power of positivity? The influence of positive psychological capital language on crowdfunding performance," Journal of Business Venturing, Elsevier, vol. 33(4), pages 470-492.

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    More about this item

    Keywords

    crowdfunding; linear growth model; number of backers; goal amount; duration;
    All these keywords.

    JEL classification:

    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • G2 - Financial Economics - - Financial Institutions and Services

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