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Success of Crowd-based Online Technology in Fundraising: An Institutional Perspective

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  • Kshetri, Nir

Abstract

The use of crowd-based online technology for raising funds is gaining popularity and credibility. This paper seeks to provide a better understanding of the effects of formal and informal institutions on the success of a crowdfunding project. It also analyzes how the effects of different types of institutions are likely to vary across the four different types of crowdfunding projects: (1) crowdlending, (2) crowdequity, (3) reward-based crowdfunding and (4) donation-based crowdfunding. A practical implication of this work is that the ease with which entrepreneurs and other types of fundraisers can raise money via crowdfunding platforms to fund a project depends upon the nature of formal and informal institutions in the economy. A theory of crowdfunding is proposed that explains these developing relationships.

Suggested Citation

  • Kshetri, Nir, 2015. "Success of Crowd-based Online Technology in Fundraising: An Institutional Perspective," Journal of International Management, Elsevier, vol. 21(2), pages 100-116.
  • Handle: RePEc:eee:intman:v:21:y:2015:i:2:p:100-116
    DOI: 10.1016/j.intman.2015.03.004
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