Skin in the game : self-funding and reward crowdfunding success

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Zhao, Liang and Shneor, Rotem and Sun, Zhe (2022) Skin in the game : self-funding and reward crowdfunding success. Business Horizons, 65 (1). pp. 89-100. ISSN 0007-6813 (https://doi.org/10.1016/j.bushor.2021.09.007)

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Abstract

This article focuses on entrepreneurs’ self-funding behavior in the reward crowdfunding context and its relation to crowdfunding success. Theoretically anchoring our discussion in signaling theory, we argue that self-funding sends similar information to that conveyed by quick-fix bootstrapping efforts. Accordingly, we hypothesize that self-funding behavior is positively associated with crowdfunding success as it can help alleviate uncertainties around a fundraiser's intent and quality as perceived by prospective backers. To show this, we use a sample of 1,583 campaigns collected from Zhongchou, the largest Chinese reward-based crowdfunding platform, to test our hypotheses. Our results demonstrate that entrepreneurs' direct self-funding is positively associated with crowdfunding success. Moreover, this effect is partially mediated by the quality of campaigns’ content elements.

ORCID iDs

Zhao, Liang ORCID logoORCID: https://orcid.org/0000-0001-8481-9926, Shneor, Rotem and Sun, Zhe;
CORE (COnnecting REpositories)