In crowdfunding we trust : a trust-building model in lending crowdfunding

Trust critically affects the perceived probability of receiving expected returns on investment. Crowdfunding differs in many ways from traditional forms of investing. We have to ask what builds trust in this particular context. Based on literature regarding the formation of initial trust, we developed a model to explain which factors lead to crowdfunders’ trust in a crowdfunding project. We tested it on data collected from actual investors in a real project on a crowdlending platform. Our results show that trust in the crowdfunding platform and the information quality are more important factors of project trust than trust in the creator

The Qualitative Analysis of Factors Influencing the Adoption Rate of Reward-Based Crowdfunding by Polish Filmmakers

The aim of this article is to analyze and discuss the factors impacting the process of the implementation of crowdfunding by the Polish film industry. The presented study is based on the qualitative approach: unstructured or semistructured interviews, questionnaires and the analysis of case studies. The respondents enumerated and evaluated a wide spectrum of factors facilitating and hindering the adoption rate: from general barriers (e.g. legal regulation of crowdfunding) to very specific aspects for filmmaking (e.g. the unprofessional promotional video of the crowdfunding project). The findings highlighted the significance of the following factors: the existing strong filmmakers’ attitude that ‘crowdfunding is for film beginners’, the complexity of team management (film crew) during the process of crowdfunding campaigns, and the cultural aspects of seeking financial support from friends.Celem artykułu jest analiza i omówienie czynników wpływających na proces implementacji crowdfundingu przez polski sektor filmowy. Zaprezentowane w artykule badania zostały oparte na metodach jakościowych: nieustrukturalizowanych lub częściowo ustrukturalizowanych wywiadach i kwestionariuszach oraz na analizie studium przypadków. Respondenci wskazali i dokonali ewaluacji szerokiego spektrum czynników wspierających i hamujących proces akceptacji innowacji, jaką jest crowdfunding: od ogólnych barier (np. legislacji prawnych dotyczących crowdfundingu), po czynniki ściśle związane z produkcją filmową (np. nieprofesjonalne wideo promujące projekt crowdfundingowy). Wyniki badań podkreślają szczególne znaczenie następujących czynników: silnej postawy respondentów oceniającej crowdfunding jako narzędzie dla początkujących filmowców, złożoność procesu zarządzania zespołem (ekipą filmową) w trakcie realizacji projektu kampanii crowdfundingowej oraz aspekt kulturowy dotyczący szukania wsparcia dla projektu wśród grona znajomych

Gender Differences in Equity Crowdfunding

Online peer-to-peer investment platforms are increasingly popular venues for entrepreneurs and investors to engage in financial transactions without the involvement of banks and loan managers. Despite their purported transparency and lack of bias, it is unclear whether social inequalities present in traditional capital markets transfer to these platforms as well, impeding their hoped revolutionary potential. In this paper we analyze nearly four years' worth of data from one of the leading UK-based equity crowdfunding platforms. Specifically, we investigate gender-related differences in patterns of entrepreneurship, investment, and success. In agreement with offline trends, men have more activity on the platform. Yet, women entrepreneurs benefit of higher success rates in fund-raising, a finding that mimics trends seen on some rewards-based crowdfunding platforms. Surprisingly, we also find that female investors tend to choose campaigns that have lower success rates. Our findings contribute to a better understanding of gender-related discrepancies in success on the online capital market and point to differences in activity that are key factors in the apparent patterns of gender inequality

Religious Prosocial Crowdlending - Dual-market Success Mechanisms

Paper I is excluded from the dissertation due to copyright. Paper II and III are excluded from the dissertation until it is publishedCrowdfunding is a relatively new and rapidly growing global phenomenon that has appealed to academic curiosity. At its crux, it is rooted in the communal philosophy of greater good. The online technological intervention can be traced back to 2006, while the phenomenon took center-stage in the midst of the 2008 Global Financial Crisis. Over a decade and a half, the crowdfunding industry has grown into several distinct forms and business models. This dissertation started with a systematic literature review that broadly considered four mainstream business models of crowdfunding, and how it is possible to bridge the knowledge gaps left behind. This led to two empirical papers, motivated by the World Bank’s recommendation of a hybrid type of crowdfunding called prosocial crowdlending, to alleviate poverty from the developing economies, where poverty alleviation is the first of the United Nations’ 17 Sustainable Development Goals. While considering the developing economies that are innately non-secular, Islam was one of the religions that did not contribute to economic success as per the extant literature. On the contrary, such Islamic developing economies have thriving religious markets. This presented a dichotomy between theory and practice and a research gap that needed to be addressed. Insights from Max Weber that religions such as Christianity have clearly contributed to economic development of the West were recalled. These insights were applied in the empirical papers focusing on Islam, extending Weber’s seminal work from west to east. The findings of the empirical papers suggest that Islam does contribute to economic growth, albeit in a welfarist sense rather than in a capitalist sense. The overall contribution that this dissertation makes to the religious prosocial crowdlending is in identifying its dual-market success mechanisms through the developed theories and integrated typologies. These explain how religious capital is being converted to economic capital facilitated by trust in otherwise low-trust developing economies, on the supply side, and religious rationality that encourages sustainable micro-entrepreneurship despite the longstanding duality between religion and reason, on the demand side. In doing so, this dissertation also explains how Islam contributes to the economic welfare of such economies, and how to channelize religious capital towards economic development by utilizing technologically enabled religious prosocial crowdlending as a strategic philanthropic tool, to successfully impact poverty by enabling micro-entrepreneurship.publishedVersio

Nurturing small and medium sized enterprises in Europe

Tourism is one of the world’s major industries responsible for economic growth, foreign exchange earnings, employment opportunities and regional balances in individual countries and across regions. This industry generates over 5% of the European Union (EU) gross domestic product and has strong linkages with other economic sectors. In fact, tourism triggers infrastructural developments that are related to the industry such as airports, seaports, parks, roads and rails. Within the EU alone, the tourism sector consists of about 1.8 million businesses. Most of these tourism businesses are small and medium sized enterprises (SMEs) that employ 5.2% of the total European workforce that translates to approximately 9.7 million jobs, with a significant proportion of young people (EU, 2010). This chapter considers relevant academic literature that differentiates SMEs from their larger counterparts. It maintains that small businesses are often constrained by their size and limited resources. Arguably, the accessibility to finance is one of the most critical factors for the SMEs’ inception and growth. These entities are often viewed by financial institutions as relatively risky when compared to enterprises from other industries. Therefore, this chapter contends that tourism SMEs may easily find themselves in an ‘equity gap’ where it may prove very difficult to raise capital for further investment. Consequently, national governments and other regulatory stakeholders are increasingly stepping in to support micro and small enterprises in many contexts. In this light, the European Union (EU) has reaffirmed its commitment for SMEs. As a matter of fact, the EU has drafted the ‘Small Business Act’ in 2008 and refined it again in 2011. The EU’s commitment is quite evident from their frequent calls for research and training schemes in the subject areas of “SMEs” and “tourism”; where grants are frequently issued under ‘Marie Curie’ and ‘Cordis FP7’ programmes. Therefore, this chapter identifies specific policies and initiatives that are aimed at fostering a climate for job creation and competitiveness for SMEs in Europe. By the end of the chapter you should be able to: • Define small and medium sized enterprises in the European Union context; • Distinguish the differences between small and medium sized enterprises and large firms; • Learn about the European Union measures that are currently supporting the financing needs of small and medium sized enterprises; • Be knowledgeable of crowd-funding as an alternative form of financing.peer-reviewe

Essays on Crowdfunding Adoption and Behavior

The aim of this dissertation is to examine aspects of crowdfunding adoption and behavior. Accordingly, the overarching research question answered by this dissertation is: what influences crowdfunding backers’ contribution intentions and behaviors? The dissertation answers this question while focusing on dimensions of trust, community, and technological acceptance. The dissertation is made up of three studies with one conceptual article (study 1), and two empirical studies (study 2 and 3). The conceptual study marries marketing and trust literatures and contextualizes their implications for the crowdfunding context. The result is the development of a framework of trust-based marketing strategies for crowdfunding campaigns, building on the understanding of the critical role played by trust in crowdfunding adoption by prospective backers. The empirical studies (i.e., study 2 and 3), are based on the analyses of empirical data collected from actual platform users, while using Structural Equation Model techniques. These studies examine the antecedents of backers’ contribution intentions and behavior, specifically in the context of reward crowdfunding in Finland. Study 2 explains backers’ intention and behavior by testing the extensive version of the technology acceptance model (TAM). It confirms the relevance of the TAM model for properly capturing influential antecedents of backers’ financial contribution intentions and behavior and further elaborates on the specific influences of backers’ experiences and voluntariness, which challenge existing conceptualizations from other information and communication technology -related contexts. Study 3 builds on the view of crowdfunding as an embedded phenomenon in online communities, to develop a community-based crowdfunding framework for explaining backers’ contribution intentions and behaviors, while highlighting the roles of community identification and community trust.publishedVersio

Why do people patronize donation-based crowdfunding platforms? An activity perspective of critical success factors

As a special type of social information systems, crowdfunding platforms draw researchers’ attention in recent years for their increasing popularity. In supplement to big-data analyses on user-generated content, behavioral research using survey and interview observations provide insights on why people like or hesitate to use such platforms. Nevertheless, extant studies focus on user intention and equity/reward-based projects, leaving the knowledge body on why people actually engage in donation-based crowdfunding underdeveloped. Based on Activity Theory, this study explores the critical success factors of crowdfunding in terms of website acceptance, crowd familiarity, and donation reciprocity. It then develops a research model that adapts relevant constructs from e-commerce and charitable behavior literature to predict user trust and readiness leading to actual donation. To test the hypothesized relationships, a structural equation modeling analysis was conducted on 744 survey responses collected from crowdfunding platform users in multiple countries. Results provide supporting evidence to most hypotheses and reveal the influential factors of technological utilization and social collaboration in the crowdfunding activity