Theories of Crowdfunding and Token Issues: A Review

Miglo, Anton

doi:10.3390/jrfm15050218

Cited by 14 publications

(13 citation statements)

References 118 publications

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“…The importance of the digital crowdfunding platform is to decrease the transaction cost and provide effective transactions (Ben Arfi and Hikkerova 2021). Entrepreneurs or project creators attempt to mitigate information problems either directly by making the description of their activities and new projects known to the public or indirectly by selecting measures that can be positively interpreted by potential investors (Miglo 2022).…”

Section: Theoretical Framework and Hypotheses Developmentmentioning

confidence: 99%

Entrepreneurial Financing in Africa during the COVID-19 Pandemic

Mamaro¹,

Sibindi²

2022

JRFM

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Access to finance by small-to-medium-enterprises (SMEs) remains an enigma that still warrants further research. The COVID-19 pandemic has exacerbated the funding gap and necessitated the need for entrepreneurs to seek alternative financing due to tight credit rationing by the traditional finance institutions. There is a marked increase in demand for alternative online finance known as crowdfunding amid social distancing and lockdowns occasioned by the COVID-19 pandemic. The main objective of this study was to examine the trends in the financing of African SMEs during the COVID-19 pandemic with a particular focus on crowdfunding. The postpositivist research philosophy and deductive strategy was adopted in this study with the view to test an existing theory and hypothesis. Secondary data sourced from TheCrowdDataCentre were utilised for the study. Eight hundred and fifty-nine African crowdfunding campaigns were employed as the unit of analysis. The study employed econometric techniques to test the research objectives of this study. The probit model was employed in the analysis. The results of the study revealed that backers, the COVID-19 and social network variables were positively and significantly related to campaign success. On the other hand, duration was found to be negatively and significantly related to crowdfunding success. The study contributes to the growing literature on the impact of COVID-19 on crowdfunding performance, as well as the literature on alternative sources of finance.

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Section: Theoretical Framework and Hypotheses Developmentmentioning

confidence: 99%

Entrepreneurial Financing in Africa during the COVID-19 Pandemic

Mamaro¹,

Sibindi²

2022

JRFM

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“…Mixed financing and more types of financing. Unlike capital structure literature (where a debt/equity mix is a very common strategy, as opposed to pure equity or pure debt financing, for a review of capital structure literature see, among others, Harris and Raviv (1991) [34]. For a traditional analysis of the capital structure of internet companies see, for example, Miglo, Lee and Liang (2014) [79]) simultaneously using ICO and IEO has not shown to be common so we do not consider it in the model.…”

Section: The Model Extensions and Robustnessmentioning

confidence: 99%

“…In this article a game-theoretic/contract theory approach (which is common in theoretical literature on optimal financing including token issues (see e.g., Harris and Raviv (1991) [33], Miglo (2022) [34], Chod and Lyandres (2021) [14] etc.) is used to build a model where an entrepreneur with an innovative idea considers launching a web-based platform.…”

Section: Introductionmentioning

confidence: 99%

Choice between IEO and ICO: Speed vs. Liquidity vs. Risk

Miglo

2022

FinTech

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This paper analyzes a financing problem for an innovative firm that is considering launching a web-based platform. The model developed in the paper is the first one that analyzes an entrepreneur’s choice between initial exchange offering (IEO) and initial coin offering (ICO). Compared to ICO, under IEO the firm is subject to screening by an exchange that reduces the risk of investment in tokens; also the firm receives access to a larger set of potential investors; finally tokens become listed on an exchange faster. The paper argues that IEO is a better option for the firm if: (1) the investment size is relatively large; (2) the extent of moral hazard problems faced by the firm is relatively large; (3) the degree of investors’ impatience is relatively small. Furthermore, a non-linear relationship between firm quality and its financing choice is found. Most of these predictions are new and have not been tested so far.

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“…Furthermore, evidence from various lenses including sustainability and cultural and arts sectors confirms that the choice of crowdfunding platform as funding technology by a fund-seeker is more complex (Maehle, 2020;Rykkja et al, 2020) and should not be based on intuitions (Baah-Peprah and Shneor, 2022) as these platforms ultimately influence behaviors (Odorovi c and Wenzlaff, 2020), such as backers' contribution behaviors on the platform (Ordanini et al, 2011). Also, other theoretical papers intuiting relationships between certain variables and crowdfunding acceptance lack empirical support and most have not been tested directly (Miglo, 2022). Despite this, the few studies that have looked at the acceptance of crowdfunding, notably reward crowdfunding, have received less attention and have only examined a few components of the technology acceptance model, while potentially underestimating relevant variables' influence (e.g.…”

Section: Introductionmentioning

confidence: 99%

“…Shneor and Munim, 2019; Baber, 2022; Shneor et al ., 2021). Also, considering the threat of moral hazard, hidden information problems and the private cost of information related to crowdfunding (Strausz, 2017; Belleflamme et al ., 2015; Deng et al ., 2022; Miglo, 2022), a second group has mostly employed signaling theory, viewing it as a mechanism for limiting information asymmetry between backers and fundraisers in backers' decision making (e.g. Kleinert et al ., 2020; Steigenberger and Wilhelm, 2018; Tajvarpour and Pujari, 2022) and enhancing effective persuasion (e.g.…”

Section: Introductionmentioning

confidence: 99%

Explaining reward crowdfunding backers' intentions and behavior

Peprah

2023

BJM

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PurposeEarlier research into crowdfunding adoption has drawn on social psychology, trust, signaling and well-being theories. Despite its wide appeal and use, the technology acceptance model (TAM) has received little attention in terms of explaining the adoption of crowdfunding platforms. The current study examines the applicability of two versions of this framework: the original TAM1 and the extended TAM2 frameworks.Design/methodology/approachData were collected through a survey distributed to the users of Finland's leading reward crowdfunding website, Mesenaatti, who have backed crowdfunding campaigns previously. The authors employed structural equation modelling (SEM–lavaan package) and conducted a series of quality tests to alleviate concerns with certain biases.FindingsAnalyses of 556 observations exhibit support for all hypotheses underlying both TAM frameworks, with two exceptions. Contrary to expectations, voluntariness does not moderate the effect of subjective norms on contribution intentions, and the effect of perceived ease-of-use is primarily mediated by perceived usefulness, rather than directly influencing intentions.Research limitations/implicationsAnalyses of 556 observations show support for all of the hypotheses that underlie both TAM frameworks, with two exceptions. Contrary to expectations, voluntariness does not moderate the effect of subjective norms on contribution intentions, and the effect of perceived ease-of-use is primarily mediated by perceived usefulness, rather than directly influencing intentions.Originality/valueFirst, the study extends the generalizability of TAM to the context of crowdfunding and with respect to financial contribution behavior. Second, it shows that backers' perceptions of platform usefulness and ease-of-use are important antecedents of crowdfunding contribution behavior, and that the former exerts greater influence than the latter. Third, it further clarifies the influences of relevant antecedents of crowdfunding backers' contribution intentions and behaviors. Specifically, the authors show that experience only weakly moderates the influence of subjective norms on contribution intentions, and voluntariness does not moderate this association. The authors discuss explanations for these findings and their implications for research and practice.

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Theories of Crowdfunding and Token Issues: A Review

Cited by 14 publications

References 118 publications

Entrepreneurial Financing in Africa during the COVID-19 Pandemic

Entrepreneurial Financing in Africa during the COVID-19 Pandemic

Choice between IEO and ICO: Speed vs. Liquidity vs. Risk

Explaining reward crowdfunding backers' intentions and behavior

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