Success factors in Title II equity crowdfunding in the United States

Mamonov, Stanislav; Malaga, Ross A.

doi:10.1080/13691066.2018.1468471

Cited by 26 publications

(27 citation statements)

References 46 publications

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“…There are various features of the equity crowdfunding market that support the above assertion. First, equity crowdfunding is different from other types of crowdfunding in terms of the backers' motivations, as well as the associated risks and rewards (Mamonov & Malaga, 2019). Compared with other types of crowdfunding, equitybased crowdfunding investors face more severe information asymmetry and uncertainty issues (Belleflamme et al, 2015;Cummings et al, 2019;Scheaf et al, 2018).…”

Section: Female Entrepreneurs and Equity Crowdfundingmentioning

confidence: 99%

Female entrepreneurs and equity crowdfunding: the consequential roles of lead investors and venture stages

2020

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Previous research has found that female entrepreneurs are disadvantaged in traditional funding markets. Yet, whether the same conclusion can be drawn in the equity crowdfunding market has not yet been determined. Leveraging both stereotype content theory and warm-glow theory, and based on a data set drawn from 259 projects from three equity crowdfunding platforms in China between October 2014 and April 2019, this study empirically examines the underlying relationship between female entrepreneurs and equity crowdfunding. Using Poisson regression analysis, we find that female entrepreneurs are more likely to be funded through equity crowdfunding than their male counterparts. Moreover, we use the presence or absence of lead investors and venture stage (i.e., early versus late) as potential moderators. Our results reveal that while lead investors augment the financing advantage of female entrepreneurs in the equity crowdfunding market, this advantage is weakened in later-development-stage ventures. The findings of this research contribute to the equity crowdfunding and the female entrepreneurship literature by showing that an entrepreneur's gender influences equity crowdfunding performance. Our findings also extend previous research by demonstrating that both lead investors and venture stage moderate the impact of gender in the equity crowdfunding market.

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Section: Female Entrepreneurs and Equity Crowdfundingmentioning

confidence: 99%

Female entrepreneurs and equity crowdfunding: the consequential roles of lead investors and venture stages

2020

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“…CF has received increasing attention by scholars who mostly focused on understanding its specific features (Raab et al, 2020), the main factors affecting the participation of both proposing and supporting actors (Groza et al, 2020) and its campaign success (Mamonov and Malaga, 2019). Currently, CF is no longer seen only as a financial tool; rather, it is often conceived as a new way to enter the market and compete (Viotto Da Cruz, 2018) and to gain access to a variety of resources through one or more CF campaigns (Pollack et al, 2019).…”

Section: Introductionmentioning

confidence: 99%

Serial crowdfunding in start-up development: a business network view

Fortezza

Pagano

Bocconcelli

2021

JBIM

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Purpose Even though the crowdfunding (CF) literature is rapidly reaching its maturity phase, the topic of serial CF (i.e. the participation in more than one CF campaign) is as much promising as still largely under explored. This study thus aims to offer a thorough view of the dynamic and complex processes characterizing the participation of the start-ups to more than one campaign adopting a business network perspective. Design/methodology/approach In line with an explorative research aim, a multiple case study analysis is performed by taking into consideration four start-ups engaged in more than one CF campaigns with different combinations of equity and non-equity CF, adopting the actor–resource–activity (ARA) model as theoretical framework. Findings Multiple CF campaigns are embedded in the overall changing startup’s network and are affected by the concurrent and overlapping startup’s development processes. From this standpoint, the adoption of the ARA model suggests to reconsider the “serial” dimension of multiple CF campaigns. These processes can be more or less “linear” as they could be affected by the combination of CF schemes and by the degree of alignment of actors, activities and resources, whose “assembly” can be facilitated by learning processes and impaired by unexpected circumstances. Originality/value This paper explores in depth the startup’s serial CF journey, building on recent studies calling for stronger analyses of the directions and outcomes of innovative funding trajectories pursued and implemented by new business ventures. From this standpoint, to the best of the authors’ knowledge, this is the first study to consider a complete spectrum of combinations between CF schemes within serial CF, thus allowing for a better understanding of the role of such a factor within a dynamic and contextual view, that is, that offered by the business network perspective. This paper also contributes to the Industrial Marketing and Purchasing research on start-ups.

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“…As was mentioned earlier, ventures' VC-backing is a prominent signal of their quality. Previous studies in crowdfunding show that crowd investors positively value that the venture has previously obtained funding from VCs (Lukkarinen et al, 2016;Vismara, 2016b;Ralcheva and Roosenboom, 2019;Colombo and Shafi, 2019;Mamonov and Malaga, 2019;Kleinert, Volkmann, and Grünhagen, 2020). Therefore, we refrain from specifying a formal hypothesis on the positive relationship between a focal venture's previous backing by VCs and the outcomes of its equity crowdfunding campaign.…”

Section: Ventures' Previous Fundraising From Professional Investors Amentioning

confidence: 99%

A Theory of Sequential-Stage Signaling: Evidence from Equity-Crowdfunding

Shafi¹,

Colombo²

2020

Preprint

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We develop a theory of sequential-stage signaling that addresses how issuers’ signals are perceived by the receivers when there is an intermediary that facilitates the transaction and the intermediary’s incentives may not be aligned with those of signal receivers. We propose that boundedly-rational receivers may misinterpret costly signals indicating issuers’ underlying quality and consider signals revealing intermediary’s private information on issuers’ quality to be more informative. We apply the theory to the context of equity crowdfunding oﬀerings in the U.S. While the signal from ventures’ backing by professional investors is associated with more positive outcomes of the crowdfunding campaigns, our ﬁndings show that this eﬀect is mediated by the equity stake requested by the crowdfunding platforms as compensation for their services. The platforms’ "skin in the game" sends an additional easily-interpretable signal to crowd investors on venture quality.

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Success factors in Title II equity crowdfunding in the United States

Cited by 26 publications

References 46 publications

Female entrepreneurs and equity crowdfunding: the consequential roles of lead investors and venture stages

Female entrepreneurs and equity crowdfunding: the consequential roles of lead investors and venture stages

Serial crowdfunding in start-up development: a business network view

A Theory of Sequential-Stage Signaling: Evidence from Equity-Crowdfunding

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