Effective strategies to attract crowdfunding investment based on the novelty of business ideas
- Title
- Effective strategies to attract crowdfunding investment based on the novelty of business ideas
- Author
- 이창준
- Keywords
- Entrepreneurial finance; Crowdfunding; Investor attraction; Deep learning; Investor persuasion; Startup success factor
- Issue Date
- 2022-03
- Publisher
- ELSEVIER SCIENCE INC
- Citation
- In Technological Forecasting & Social Change May 2022 178
- Abstract
- Whether the novelty of an idea is a factor that directly influences crowdfunding success remains an area of
ambiguity. We hypothesize that target funder diversification is effective with incremental ideas. However,
focused business proposals are better suited to assert radical ideas. We also hypothesize the impact of two
different strategic actions that founders can take during fundraising campaigns, agile information update and
communication, on crowdfunding success. A deep-learning-based novelty detection model combined with sta-
tistical analysis is used to empirically test 7406 crowdfunding projects crawled from online platform. Our results
support our hypotheses and reveal that information updates from startup founders show non-linear quadratic
relationships with fundraising performance, whereas two-sided communication helps stimulate investors. We
also revealed that novelty level can influence strategic choice, indicating that a project with a higher novelty
should have a focused target. Our finding suggests a solution to the conflicting conclusions in previous studies on
the direct impact of novelty level and target diversification, by explaining the process of novelty-dependent
behavioral strategies based on signaling theory.
- URI
- https://www.sciencedirect.com/science/article/pii/S0040162522000907https://repository.hanyang.ac.kr/handle/20.500.11754/170939
- ISSN
- 0040-1625
- DOI
- 10.1016/j.techfore.2022.121558
- Appears in Collections:
- COLLEGE OF COMMUNICATION[E](언론정보대학) > ETC
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