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Signalling entrepreneurs’ credibility and project quality for crowdfunding success: cases from the Kickstarter and Indiegogo environments

Shuangfa Huang Orcid Logo, David Pickernell Orcid Logo, Martina Battisti, Thang Nguyen

Small Business Economics, Volume: 58, Issue: 4, Pages: 1801 - 1821

Swansea University Author: David Pickernell Orcid Logo

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DOI (Published version): 10.1007/s11187-021-00477-6

Abstract

In recent years, entrepreneurs have increasingly turned to crowdfunding, a new form of entrepreneurial finance, to fund projects. Whilst research has shown that signals originating fromthe entrepreneur and project can affect the outcome of crowdfunding, how different signals work together under diff...

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Published in: Small Business Economics
ISSN: 0921-898X 1573-0913
Published: Springer Science and Business Media LLC 2022
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URI: https://cronfa.swan.ac.uk/Record/cronfa61219
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spelling 2024-11-27T15:53:20.0954962 v2 61219 2022-09-14 Signalling entrepreneurs’ credibility and project quality for crowdfunding success: cases from the Kickstarter and Indiegogo environments 913bd73da00d7df4f5038f6f144b235e 0000-0003-0912-095X David Pickernell David Pickernell true false 2022-09-14 CBAE In recent years, entrepreneurs have increasingly turned to crowdfunding, a new form of entrepreneurial finance, to fund projects. Whilst research has shown that signals originating fromthe entrepreneur and project can affect the outcome of crowdfunding, how different signals work together under different signalling environments remains underexplored. Drawing on signalling theory, we examine how signals of entrepreneurs’ credibility (success, failure, backer and industry experience) and project quality (preparedness and thirdparty endorsements) produce crowdfunding success in different signalling environments. We collected a unique dataset with matched projects listed on both Kickstarter and Indiegogo, but with different funding models, to represent two distinct signalling environments. Results based on qualitative comparative analysis (QCA) identify two distinct signalling patterns that show entrepreneur’s credibility and project quality signals can complement each other to produce crowdfunding success. In an environment with less uncertainty, entrepreneur’s credibility in terms of crowdfunding experience can also compensate absent project quality to produce crowdfunding success. In an environment with higher uncertainty, entrepreneur’s credibility and project quality need to be both present to establish the necessary legitimacy for crowdfunding to be successful. Furthermore, by integrating positive (i.e. success) and negative (i.e. failure) signals, we demonstrate how signal incongruence can enhance crowdfunding success. Journal Article Small Business Economics 58 4 1801 1821 Springer Science and Business Media LLC 0921-898X 1573-0913 Crowdfunding; Signalling theory; Qualitative comparative analysis (QCA); Kickstarter; Indiegogo; Entrepreneurial Finance 1 4 2022 2022-04-01 10.1007/s11187-021-00477-6 COLLEGE NANME Management School COLLEGE CODE CBAE Swansea University 2024-11-27T15:53:20.0954962 2022-09-14T13:48:26.0839607 Faculty of Humanities and Social Sciences School of Management - Business Management Shuangfa Huang 0000-0001-5867-3521 1 David Pickernell 0000-0003-0912-095X 2 Martina Battisti 3 Thang Nguyen 4 61219__25283__a8d43362a6cd4c4d91d53b1bc2a50843.pdf 61219_VoR.pdf 2022-10-03T12:03:51.9866350 Output 534011 application/pdf Version of Record true Copyright: The Author(s) 2021. This article is licensed under a Creative Commons Attribution 4.0 International License. true eng http://creativecommons.org/licenses/by/4.0/
title Signalling entrepreneurs’ credibility and project quality for crowdfunding success: cases from the Kickstarter and Indiegogo environments
spellingShingle Signalling entrepreneurs’ credibility and project quality for crowdfunding success: cases from the Kickstarter and Indiegogo environments
David Pickernell
title_short Signalling entrepreneurs’ credibility and project quality for crowdfunding success: cases from the Kickstarter and Indiegogo environments
title_full Signalling entrepreneurs’ credibility and project quality for crowdfunding success: cases from the Kickstarter and Indiegogo environments
title_fullStr Signalling entrepreneurs’ credibility and project quality for crowdfunding success: cases from the Kickstarter and Indiegogo environments
title_full_unstemmed Signalling entrepreneurs’ credibility and project quality for crowdfunding success: cases from the Kickstarter and Indiegogo environments
title_sort Signalling entrepreneurs’ credibility and project quality for crowdfunding success: cases from the Kickstarter and Indiegogo environments
author_id_str_mv 913bd73da00d7df4f5038f6f144b235e
author_id_fullname_str_mv 913bd73da00d7df4f5038f6f144b235e_***_David Pickernell
author David Pickernell
author2 Shuangfa Huang
David Pickernell
Martina Battisti
Thang Nguyen
format Journal article
container_title Small Business Economics
container_volume 58
container_issue 4
container_start_page 1801
publishDate 2022
institution Swansea University
issn 0921-898X
1573-0913
doi_str_mv 10.1007/s11187-021-00477-6
publisher Springer Science and Business Media LLC
college_str Faculty of Humanities and Social Sciences
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hierarchy_top_id facultyofhumanitiesandsocialsciences
hierarchy_top_title Faculty of Humanities and Social Sciences
hierarchy_parent_id facultyofhumanitiesandsocialsciences
hierarchy_parent_title Faculty of Humanities and Social Sciences
department_str School of Management - Business Management{{{_:::_}}}Faculty of Humanities and Social Sciences{{{_:::_}}}School of Management - Business Management
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description In recent years, entrepreneurs have increasingly turned to crowdfunding, a new form of entrepreneurial finance, to fund projects. Whilst research has shown that signals originating fromthe entrepreneur and project can affect the outcome of crowdfunding, how different signals work together under different signalling environments remains underexplored. Drawing on signalling theory, we examine how signals of entrepreneurs’ credibility (success, failure, backer and industry experience) and project quality (preparedness and thirdparty endorsements) produce crowdfunding success in different signalling environments. We collected a unique dataset with matched projects listed on both Kickstarter and Indiegogo, but with different funding models, to represent two distinct signalling environments. Results based on qualitative comparative analysis (QCA) identify two distinct signalling patterns that show entrepreneur’s credibility and project quality signals can complement each other to produce crowdfunding success. In an environment with less uncertainty, entrepreneur’s credibility in terms of crowdfunding experience can also compensate absent project quality to produce crowdfunding success. In an environment with higher uncertainty, entrepreneur’s credibility and project quality need to be both present to establish the necessary legitimacy for crowdfunding to be successful. Furthermore, by integrating positive (i.e. success) and negative (i.e. failure) signals, we demonstrate how signal incongruence can enhance crowdfunding success.
published_date 2022-04-01T20:27:46Z
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