Crowdfunding as a Font of Entrepreneurship: Outcomes of Reward-Based Crowdfunding

Mollick, Ethan

doi:10.1007/978-3-319-66119-3_7

Cited by 13 publications

(6 citation statements)

References 9 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…The only top category for which no effect was found was game. As reported in Mollick (2018), popular categories require significantly more funding. Given that project creators are competing in the same resource pool, CC users might strategically view the non-CC creators who have created projects in more popular categories as competitors as the market saturates.…”

Section: Discussionmentioning

confidence: 96%

“…When creators launch their projects on crowdfunding platforms, they usually need to pick an area or a category such as games, music or film. It is reasonable to expect that creators tend to think other creators in the same category pose a stronger competitive threat to them than creators from other categories (Mollick, 2018). For instance, a creator in the film category is more likely to regard another creator in the film category, compared to the video game category, as a potential competitor for the same pool of resources.…”

Section: Crowdfunding Through the Collective Action Lens: When Compet...mentioning

confidence: 99%

See 1 more Smart Citation

Networking the commons: creative commons project creators funding patterns in crowdfunding

Wang

Lu²,

Fulk³

2022

OIR

View full text Add to dashboard Cite

PurposeGuided by the collective action theory, signaling theory and social identity approach, this study examines backing behavior by individuals who have created projects under CC licenses. Two motivational mechanisms were examined: (1) identification via common interests in the CC space; (2) resource signaling by other users via their diverse project creation experience, funding or commenting activity.Design/methodology/approachData were collected from Kickstarter.com. Exponential random graph modeling was used to examine how the two reviewed mechanisms influence the tie formation probability between Creative Commons (CC) project creators and other creators. The analysis was conducted on two subnetworks: one with ties between CC creators; and one with ties from CC creators to non-CC creators.FindingsThe study found that CC creators exhibit distinct backing patterns when considering funding other CC creators compared to non-CC users. When considering funding their peer CC creators, CC identity can help them allocate and support perceived in-group members; when considering funding non-CC creators, shared common interests in competitive project categories potentially triggers a competition mindset and makes them hold back when they see potential rivals.Originality/valueThis study makes three contributions. First, it draws from multiple theoretical frameworks to investigate unique motivations when crowdfunders take on dual roles of creators and funders and offered implications on how to manage competition and collaboration simultaneously. Second, with network analysis our study not only identifies multiple motivators at work for collective action, but also demonstrates their differential effects in crowdfunding. Third, the integration of multiple theoretical frameworks allows opportunities for theory building.Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/OIR-05-2020-0166.

show abstract

Section: Discussionmentioning

confidence: 96%

Section: Crowdfunding Through the Collective Action Lens: When Compet...mentioning

confidence: 99%

Networking the commons: creative commons project creators funding patterns in crowdfunding

Wang

Lu²,

Fulk³

2022

OIR

View full text Add to dashboard Cite

show abstract

“…Future research may consider other types of information uncertainty beyond the project's likelihood of success and may investigate their influence on the pledging dynamics. For instance, one salient concern from backers is whether and when project creators will successfully deliver the products (Mollick & Kuppuswamy, 2014). This type of information asymmetry and uncertainty may affect backers' pledging decisions even after the target is reached when the success uncertainty is resolved.…”

Section: Discussionmentioning

confidence: 99%

Contingent stimulus in crowdfunding

2022

Production and Operations Management

View full text Add to dashboard Cite

Reward-based crowdfunding is a form of innovative financing that allows project creators to raise funds from potential backers to start their ventures. A crowdfunding project is successfully funded if and only if the predetermined funding goal is achieved within a given time. We study the optimal timing of contingently placing a "fulcrum" in the random pledging process, with the potential of tilting it toward success, which would be a win-win for the creator, backers, and platform. Specifically, we consider a model where backers arrive sequentially at a crowdfunding project. Upon arrival, a backer makes her pledging decision by taking into account the expected success of the project. We characterize the dynamics of the project's pledging process. We show that there exists a cascade effect on backers' pledging, which is mainly driven by the all-or-nothing nature of crowdfunding projects. According to our data collected from the most popular online crowdfunding platform, Kickstarter, the majority of projects fail to achieve their goals. To address this issue, we propose three contingent stimulus policies, namely, seeding, feature upgrade, and limited-time offer. As a result of the cascade effect on backers' pledging, the optimal timing to apply stimulus policies has a cutoff-time structure. Lastly, we show that the benefit of contingent policies is greatest in the middle of crowdfunding campaigns. Testing with the dataset of Kickstarter, we obtain empirical evidence that the projects' success rates improve by 14.6% on average with updates in the middle of the campaign and when the pledging progress is lagging.

show abstract

“…It represents nearly 50% (214/549) of all projects that have reached over $1 million. Third, games are among the projects closest to those pursued by serial entrepreneurs (Xu, 2015) and aimed at creating or sustaining an organisation rather than a one-off campaign (Mollick, 2018;Parhankangas & Renko, 2017). It also allowed us to see if the creators repeat the same tactics in different campaigns and how their strategy changes.…”

Section: Methodsmentioning

confidence: 99%

How to create an engagement-friendly environment in reward-based crowdfunding?

Bielicki

Rydzewski

2022

Central European Economic Journal

View full text Add to dashboard Cite

Crowdfunding appears to be an innovative way of fundraising various projects. Although it is a relatively new and unique way of financing, competition for potential backers increases every year. While recent works have explored the role of engagement and involvement in crowdfunding, there is still a lack of understanding of how creators can stimulate backers’ activity. Therefore the aim of this paper is to identify and classify the methods used for crowdfunding by the top creators to boost and maintain backer engagement. Drawing from the Theoretical Model of Customer Engagement and Theory of Intrinsically Motivating Instruction, we propose a theoretical model that is backer engagement-based. It presents the unique role of involvement and participation in engagement and its interrelationship with value and community involvement. We investigate the top 30 most funded campaigns on Kickstarter in the tabletop games category. Based on our cross-case study, we identify and categorise tactics that create engagement-friendly environments. Our findings suggest that over time creators tend to focus on shorter but more dynamic campaigns with the higher engagement of backers. The creators of the best campaigns use similar tactics that affect both engagement and involvement. The important but often ignored factor that influences engagement is social interaction.

show abstract

Crowdfunding as a Font of Entrepreneurship: Outcomes of Reward-Based Crowdfunding

Cited by 13 publications

References 9 publications

Networking the commons: creative commons project creators funding patterns in crowdfunding

Networking the commons: creative commons project creators funding patterns in crowdfunding

Contingent stimulus in crowdfunding

How to create an engagement-friendly environment in reward-based crowdfunding?

Contact Info

Product

Resources

About