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

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)

[thumbnail of Zhao-etal-BH-2022-Skin-in-the-game-self-funding-and reward] Text. Filename: Zhao-etal-BH-2022-Skin-in-the-game-self-funding-and_reward.pdf
Accepted Author Manuscript
Restricted to Repository staff only until 23 December 2024.
License: Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 logo
Download (969kB) | Request a copy

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)