Geography in Online Capital Allocation: Evidence from Equity-Based Crowdfunding

Digital investment platforms reduce search costs, yet realized investments can remain geographically concentrated. Such concentration alone cannot distinguish whether local investment reflects initial salience, proximity-related information, prior ties, or nonpecuniary motives such as support for firms in one's home prefecture. We use user-campaign records from Fundinno, Japan's dominant equity-based crowdfunding platform, which link listing exposure, campaign-page views, and investments to user residence and issuer location. For campaigns outside the Tokyo metropolitan area (non-TMA), same-prefecture users are 6.7 percentage points more likely to invest after viewing a campaign page, relative to an other-prefecture investment rate of roughly 10 percent. The corresponding adjacent-prefecture difference is only 0.9 percentage points, and the same-prefecture premium is small for campaigns inside the Tokyo metropolitan area. The premium therefore remains after observed campaign-page access, is much larger than the adjacent-prefecture difference, and is concentrated outside the metropolitan core. These findings show that online access does not make investment demand geographically neutral: for regional issuers, same-prefecture investors remain disproportionately important even after campaign-page access. The data do not identify the underlying motive, but the pattern is difficult to explain by discovery alone or by smooth proximity.