Crowdfunding in Kenya: Factors for Successful Campaign : The Case of Kickstarter Crowdfunding Platform

Abstract

The study aimed at investigating the factors that lead to successful crowdfunding campaigns in Kenya. The success factors of reward-based crowdfunded campaigns vary in different countries due to differences in cultures, legal requirements, social interactions, political and business environments. With very minimal research on crowdfunding funding in Kenya, the study therefore, aimed at analyzing reward-based crowdfunding in Kenya using Kickstarter data, and identifying the crucial factors necessary to run a successful campaign. To achieve this objective, the study used a multiple regression and Pearson correlations. The study found a statistically significant regression equation hence the regression model was considered a good fit. The study using the Pearson correlations analysis found a very strong and positive statistical correlation between updates, amount pledged, backers, and successful projects, moderate but positive statistical correlation between comments, new backers, returning backers, and successful projects. However, there was a negative but insignificant correlation between the goal, funding period, and successful projects. The novelty will be of great benefit to project funders who want to run successful projects in Kenya. This is because the concept of crowdfunding is still new in Kenya and has not been widely publicized, accepted, or researched. The results of this study will guide potential founders on the do’s and don’ts of running a successful campaign. Finally, the study recommends further research on the success factors of other crowdfunding models in Kenya as the study solely focused on the reward-based model.

Entrepreneurial Financing in Africa during the COVID-19 Pandemic

“…In addition to that, the higher number of backers contributing to the crowdfunding platform increases the probability of success rate as compared to the lower number of backers. Hence, the results are in line with the findings by Mollick (2014) and Wachira (2021).…”

“…However, in Africa, crowdfunding is still at the infancy level due to limited technological infrastructure and internet usage (Chao et al 2020). Regardless of the low adoption of crowdfunding in Africa, crowdfunding has potential to provide access to finance to entrepreneurs (Wachira 2021).…”

Financial Sustainability of African Small-to-Medium Enterprises during the COVID-19 Pandemic: Determinants of Crowdfunding Success

“…Moreover, there was little literature on crowdfunding focusing on Africa during the COVID-19 pandemic. Hence, this study fills the research gaps identified by scholars such as Wachira [11], Zribi [7], and Igra et al [19]. Further, although there are studies that examined the effects of the COVID-19 pandemic on crowdfunding performances [7,8,[19][20][21], these studies were confined to developed countries; hence, their findings do not necessarily yield similar results for Africa.…”

“…Hence, from the vantage point of the transformational entrepreneur social theory, crowdfunding has the potential to overcome problems created by the COVID-19 pandemic in relation to access to finance. A crowdfunding platform alleviates the limited access to financing due to its popularity and growth, especially in Africa [11].…”

“…Second, for the non-investment crowdfunding model, the donationbased model is the main model. The donation-based model is described as the acceptance of money without any expectation of return, whereas with the reward-based model is described as the acceptance of money in exchange for a reward [11]. Consequently, rewardbased crowdfunding remains the largest worldwide due to its popularity and usage [3].…”