Directing the wisdom of the crowd: the importance of social interaction among founders and the crowd during crowdfunding campaigns. Issue 8 (17th November 2018)

• Record Type: Journal Article
• Authors: Clauss, Thomas; Breitenecker, Robert J.; Kraus, Sascha; Brem, Alexander; Richter, Chris
• Is Part Of: Economics of innovation and new technology. Volume 27:Issue 8(2018)
• Page Start: 709
• Page End: 729
• Publication Date: 2018-11-17
• Subjects: Crowdfunding -- technology firms -- entrepreneurs -- social interaction; L26 -- O30 -- O35; Technological innovations -- Economic aspects -- Periodicals; 338.06405
• DOI: 10.1080/10438599.2018.1396660
• Languages: English
• ISSNs: 1043-8599

Abstract

ABSTRACT: Crowdfunding plays an important role as an alternative funding source for technology ventures. No earlier studies particularly investigated the importance of social interactions during such crowdfunding campaigns. Hence, we particularly take the interaction between the project owner and the community as well as among community members into account. We empirically investigated potential success factors for crowdfunding projects of entrepreneurs on the base of 430 projects from the German crowdfunding platform Visionbakery. Our results show that social interaction during a crowdfunding campaign indeed increases the likelihood of its success. As comments from crowd members on particular projects might be positive or negative and can also provide additional argumentation or raise questions, comments can cause a dialog among crowd members. This shows that herding might not only be related to the number of contributors but also to their shared attributes and perceptions. Our discussion of theoretical and managerial implications closes with recommendations for future research on this evolving topic.