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A multi-method study of social ties and crowdfunding success: Opening the black box to get the cash inside

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  • Simon, Mark
  • Stanton, Steven J.
  • Townsend, Janell D.
  • Kim, John

Abstract

We conducted one field experiment and three controlled experiments to explore how to increase crowdfunding success, focusing on the relationship between individuals soliciting funds and potential contributors. Specifically, we examined how social closeness, contact frequency and trust influenced contribution likelihood and investigated the mediating effects of obligation, fear of loss of relationship and happiness. Finally, we tested whether requesting higher contribution amounts increased the average dollars contributed. We found that closeness and frequency, but not trust, increased the contribution likelihood and that feelings of obligation and the fear of loss, but not happiness, mediated the relationship. Requesting higher contribution amounts increased a person's average contribution.

Suggested Citation

  • Simon, Mark & Stanton, Steven J. & Townsend, Janell D. & Kim, John, 2019. "A multi-method study of social ties and crowdfunding success: Opening the black box to get the cash inside," Journal of Business Research, Elsevier, vol. 104(C), pages 206-214.
    • Handle: RePEc:eee:jbrese:v:104:y:2019:i:c:p:206-214
    DOI: 10.1016/j.jbusres.2019.07.010
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    Cited by:

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    3. Aaron H. Anglin & Christopher Courtney & Thomas H. Allison, 2022. "Venturing for Others, Subject to Role Expectations? A Role Congruity Theory Approach to Social Venture Crowd Funding," Entrepreneurship Theory and Practice, , vol. 46(2), pages 421-448, March.
    4. Cai, Wanxiang & Polzin, Friedemann & Stam, Erik, 2021. "Crowdfunding and social capital: A systematic review using a dynamic perspective," Technological Forecasting and Social Change, Elsevier, vol. 162(C).
    5. Rodney C. Shrader & Mark Simon & Steven Stanton, 2021. "Financial forecasting and risky decisions: an experimental study grounded in Prospect theory," International Entrepreneurship and Management Journal, Springer, vol. 17(4), pages 1827-1841, December.
    6. Huiling Zhang & Yaokuang Li & Juan Wu & Li Ling, 2022. "How do the network structures of lead investors affect the following of distant strangers? Evidence from Chinese equity crowdfunding," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(8), pages 3516-3533, December.
    7. Calic, Goran & Shevchenko, Anton, 2020. "How signal intensity of behavioral orientations affects crowdfunding performance: The role of entrepreneurial orientation in crowdfunding business ventures," Journal of Business Research, Elsevier, vol. 115(C), pages 204-220.
    8. Shneor, Rotem & Zhao, Liang & Fabian Michael Goedecke, Jann, 2023. "On relationship types, their strength, and reward crowdfunding backer behavior," Journal of Business Research, Elsevier, vol. 154(C).
    9. Moradi, Masoud & Badrinarayanan, Vishag, 2021. "The effects of brand prominence and narrative features on crowdfunding success for entrepreneurial aftermarket enterprises," Journal of Business Research, Elsevier, vol. 124(C), pages 286-298.
    10. Groza, Mya Pronschinske & Groza, Mark D. & Barral, Luis Miguel, 2020. "Women backing women: The role of crowdfunding in empowering female consumer-investors and entrepreneurs," Journal of Business Research, Elsevier, vol. 117(C), pages 432-442.

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