IDEAS home Printed from https://ideas.repec.org/a/eee/jobuve/v15y2021ics2352673421000135.html
   My bibliography  Save this article

A whole new world: Counterintuitive crowdfunding insights for female founders

Author

Listed:
  • Wesemann, Henrik
  • Wincent, Joakim

Abstract

Female entrepreneurs are subjected to stereotypes that make it difficult to secure funding. Crowdfunding challenges many of the causes of this discrimination but we know little about if and how it changes optimal funding strategies for female entrepreneurs. Using a sample of 3191 crowdfunding campaigns by female entrepreneurs, we draw from signaling theory to develop and test a series of counterintuitive conjectures for female crowdfunding success. Our results contradict advice that may be derived from traditional entrepreneurial finance: women in crowdfunding should use their gender as advertising, use more female-centric language, avoid self-promotion, start businesses in male-dominated sectors, and ask for more money. These findings highlight new theoretical mechanisms in crowdfunding and develop recommendations for female entrepreneurs who want to raise funds.

Suggested Citation

  • Wesemann, Henrik & Wincent, Joakim, 2021. "A whole new world: Counterintuitive crowdfunding insights for female founders," Journal of Business Venturing Insights, Elsevier, vol. 15(C).
    • Handle: RePEc:eee:jobuve:v:15:y:2021:i:c:s2352673421000135
    DOI: 10.1016/j.jbvi.2021.e00235
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S2352673421000135
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jbvi.2021.e00235?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kimberly A. Eddleston & Jamie J. Ladge & Cheryl Mitteness & Lakshmi Balachandra, 2016. "Do you See what I See? Signaling Effects of Gender and Firm Characteristics on Financing Entrepreneurial Ventures," Entrepreneurship Theory and Practice, , vol. 40(3), pages 489-514, May.
    2. Hadar Gafni & Dan Marom & Alicia Robb & Orly Sade, 2021. "Gender Dynamics in Crowdfunding (Kickstarter): Evidence on Entrepreneurs, Backers, and Taste-Based Discrimination [Women on the verge of a breakthrough: networking among entrepreneurs in the United," Review of Finance, European Finance Association, vol. 25(2), pages 235-274.
    3. Chan, Ho Fai & Moy, Naomi & Schaffner, Markus & Torgler, Benno, 2021. "The effects of money saliency and sustainability orientation on reward based crowdfunding success," Journal of Business Research, Elsevier, vol. 125(C), pages 443-455.
    4. Ewens, Michael & Townsend, Richard R., 2020. "Are early stage investors biased against women?," Journal of Financial Economics, Elsevier, vol. 135(3), pages 653-677.
    5. Parhankangas, Annaleena & Renko, Maija, 2017. "Linguistic style and crowdfunding success among social and commercial entrepreneurs," Journal of Business Venturing, Elsevier, vol. 32(2), pages 215-236.
    6. Maya Christiane Flensborg Jensen, 2017. "Gender Stereotypes and the Reshaping of Stigma in Rehabilitative Eldercare," Gender, Work and Organization, Wiley Blackwell, vol. 24(6), pages 656-674, November.
    7. Jasmin Joecks & Kerstin Pull & Karin Vetter, 2013. "Gender Diversity in the Boardroom and Firm Performance: What Exactly Constitutes a “Critical Mass?”," Journal of Business Ethics, Springer, vol. 118(1), pages 61-72, November.
    8. Mollick, Ethan, 2014. "The dynamics of crowdfunding: An exploratory study," Journal of Business Venturing, Elsevier, vol. 29(1), pages 1-16.
    9. Nan Langowitz & Maria Minniti, 2007. "The Entrepreneurial Propensity of Women," Entrepreneurship Theory and Practice, , vol. 31(3), pages 341-364, May.
    10. Thomas H. Allison & Blakley C. Davis & Jeremy C. Short & Justin W. Webb, 2015. "Crowdfunding in a Prosocial Microlending Environment: Examining the Role of Intrinsic versus Extrinsic Cues," Entrepreneurship Theory and Practice, , vol. 39(1), pages 53-73, January.
    11. Elena Bardasi & Shwetlena Sabarwal & Katherine Terrell, 2011. "How do female entrepreneurs perform? Evidence from three developing regions," Small Business Economics, Springer, vol. 37(4), pages 417-441, November.
    12. Ruhnka, John C. & Young, John E., 1991. "Some hypotheses about risk in venture capital investing," Journal of Business Venturing, Elsevier, vol. 6(2), pages 115-133, March.
    13. Brockner, Joel & Higgins, E. Tory & Low, Murray B., 2004. "Regulatory focus theory and the entrepreneurial process," Journal of Business Venturing, Elsevier, vol. 19(2), pages 203-220, March.
    14. Mussweiler, Thomas & Strack, Fritz, 2001. "The Semantics of Anchoring," Organizational Behavior and Human Decision Processes, Elsevier, vol. 86(2), pages 234-255, November.
    15. Sibin Wu & Bin Wang & Yuanqing Li, 2015. "How to attract the crowd in crowdfunding?," International Journal of Entrepreneurship and Small Business, Inderscience Enterprises Ltd, vol. 24(3), pages 322-334.
    16. Gerrit K.C. Ahlers & Douglas Cumming & Christina Günther & Denis Schweizer, 2015. "Signaling in Equity Crowdfunding," Entrepreneurship Theory and Practice, , vol. 39(4), pages 955-980, July.
    17. Saulo Dubard Barbosa & Alain Fayolle, 2007. "Where Is The Risk? Availability, Anchoring, and Framing Effects on Entrepreneurial Risk Taking," Post-Print halshs-00176865, HAL.
    18. Ajay Agrawal & Christian Catalini & Avi Goldfarb, 2014. "Some Simple Economics of Crowdfunding," Innovation Policy and the Economy, University of Chicago Press, vol. 14(1), pages 63-97.
    19. Richard T. Harrison & Colin M. Mason, 2007. "Does Gender Matter? Women Business Angels and the Supply of Entrepreneurial Finance," Entrepreneurship Theory and Practice, , vol. 31(3), pages 445-472, May.
    20. Denis Frydrych & Adam J. Bock & Tony Kinder & Benjamin Koeck, 2014. "Exploring entrepreneurial legitimacy in reward-based crowdfunding," Venture Capital, Taylor & Francis Journals, vol. 16(3), pages 247-269, July.
    21. Crowe, Ellen & Higgins, E. Tory, 1997. "Regulatory Focus and Strategic Inclinations: Promotion and Prevention in Decision-Making," Organizational Behavior and Human Decision Processes, Elsevier, vol. 69(2), pages 117-132, February.
    22. C.S. Richard Chan & Haemin Dennis Park & Pankaj Patel & David Gomulya, 2018. "Reward-based crowdfunding success: decomposition of the project, product category, entrepreneur, and location effects," Venture Capital, Taylor & Francis Journals, vol. 20(3), pages 285-307, July.
    23. Leora F. Klapper & Simon C. Parker, 2011. "Gender and the Business Environment for New Firm Creation," The World Bank Research Observer, World Bank, vol. 26(2), pages 237-257, August.
    24. Davis, Blakley C. & Hmieleski, Keith M. & Webb, Justin W. & Coombs, Joseph E., 2017. "Funders' positive affective reactions to entrepreneurs' crowdfunding pitches: The influence of perceived product creativity and entrepreneurial passion," Journal of Business Venturing, Elsevier, vol. 32(1), pages 90-106.
    25. Malin Malmström & Jeaneth Johansson & Joakim Wincent, 2017. "Gender Stereotypes and Venture Support Decisions: How Governmental Venture Capitalists Socially Construct Entrepreneurs’ Potential," Entrepreneurship Theory and Practice, , vol. 41(5), pages 833-860, September.
    26. Groza, Mya Pronschinske & Groza, Mark D. & Barral, Luis Miguel, 2020. "Women backing women: The role of crowdfunding in empowering female consumer-investors and entrepreneurs," Journal of Business Research, Elsevier, vol. 117(C), pages 432-442.
    27. Endrit Kromidha & Paul Robson, 2016. "Social identity and signalling success factors in online crowdfunding," Entrepreneurship & Regional Development, Taylor & Francis Journals, vol. 28(9-10), pages 605-629, October.
    28. Hadar Gafni & Dan Marom & Alicia Robb & Orly Sade, 0. "Gender Dynamics in Crowdfunding (Kickstarter): Evidence on Entrepreneurs, Backers, and Taste-Based Discrimination," Review of Finance, European Finance Association, vol. 25(2), pages 235-274.
    29. Huasheng Gao & Yaheng Lin & Yujing Ma, 2016. "Sex Discrimination and Female Top Managers: Evidence from China," Journal of Business Ethics, Springer, vol. 138(4), pages 683-702, November.
    30. Malmström, Malin & Voitkane, Aija & Johansson, Jeaneth & Wincent, Joakim, 2020. "What do they think and what do they say? Gender bias, entrepreneurial attitude in writing and venture capitalists’ funding decisions," Journal of Business Venturing Insights, Elsevier, vol. 13(C).
    31. Michael Spence, 1973. "Job Market Signaling," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 87(3), pages 355-374.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. McSweeney, Jordan J. & McSweeney, Kevin T. & Webb, Justin W. & Devers, Cynthia E., 2022. "The right touch of pitch assertiveness: Examining entrepreneurs' gender and project category fit in crowdfunding," Journal of Business Venturing, Elsevier, vol. 37(4).
    2. Seigner, Benedikt David Christian & Milanov, Hana & Lundmark, Erik & Shepherd, Dean A., 2023. "Tweeting like Elon? Provocative language, new-venture status, and audience engagement on social media," Journal of Business Venturing, Elsevier, vol. 38(2).
    3. Cutolo, Donato & Grimaldi, Rosa, 2023. "I wasn't expecting that: How engaging with digital platforms can turn leisure passion into entrepreneurial aspirations," Journal of Business Venturing Insights, Elsevier, vol. 20(C).
    4. Williamson, Amanda J. & Short, Jeremy C. & Wolfe, Marcus T., 2021. "Standing out in crowdfunded microfinance: A topic modeling approach examining campaign distinctiveness and prosocial performance," Journal of Business Venturing Insights, Elsevier, vol. 16(C).
    5. Seigner, Benedikt David Christian & McKenny, Aaron F. & Reetz, David K., 2024. "Old but gold? Examining the effect of age bias in reward-based crowdfunding," Journal of Business Venturing, Elsevier, vol. 39(3).
    6. Hayward, Mathew & Cheng, Zhiming & Wang, Haining & Smyth, Russell, 2023. "Parental influence and the propensity for entrepreneurship: Evidence from the one-child policy," Journal of Business Venturing Insights, Elsevier, vol. 20(C).
    7. Berné-Martínez, J.M. & Ortigosa-Blanch, Arturo & Planells-Artigot, Enrique, 2021. "A semantic analysis of crowdfunding in the digital press," Technological Forecasting and Social Change, Elsevier, vol. 173(C).
    8. Dana Nayer & Mosi Rosenboim & Miki Malul, 2024. "The Two Sides of Crowdfunding Success: Attributes and Motivations of Backers and Entrepreneurs—Evidence from Israel," Journal of Entrepreneurship and Innovation in Emerging Economies, Entrepreneurship Development Institute of India, vol. 33(1), pages 155-182, February.
    9. Wesemann, Henrik & Antretter, Torben, 2023. "Why don’t you like me? Exploring the social venture funding gap in angel investing," Journal of Business Venturing Insights, Elsevier, vol. 20(C).
    10. Seigner, Benedikt David Christian & Milanov, Hana, 2023. "Mirror, mirror—A gendered lens on female entrepreneurs’ facial attractiveness in reward-based crowdfunding," Journal of Business Venturing Insights, Elsevier, vol. 20(C).
    11. Kincaid, Paula A. & Short, Jeremy C. & Wolfe, Marcus T., 2022. "Got ink, get paid? Exploring the impact of tattoo visibility on crowdfunding performance," Journal of Business Venturing Insights, Elsevier, vol. 17(C).
    12. Hassna, Ghazwan, 2022. "Crowdfund smart, not hard – Understanding the role of online funding communities in crowdfunding success," Journal of Business Venturing Insights, Elsevier, vol. 18(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Elitzur, Ramy & Solodoha, Eliran, 2021. "Does gender matter? Evidence from crowdfunding," Journal of Business Venturing Insights, Elsevier, vol. 16(C).
    2. Aaron H. Anglin & Christopher Courtney & Thomas H. Allison, 2022. "Venturing for Others, Subject to Role Expectations? A Role Congruity Theory Approach to Social Venture Crowd Funding," Entrepreneurship Theory and Practice, , vol. 46(2), pages 421-448, March.
    3. Geiger, Mark, 2020. "A meta-analysis of the gender gap(s) in venture funding: Funder- and entrepreneur-driven perspectives," Journal of Business Venturing Insights, Elsevier, vol. 13(C).
    4. Xiaobei Liang & Xiaojuan Hu & Jiang Jiang, 2020. "Research on the Effects of Information Description on Crowdfunding Success within a Sustainable Economy—The Perspective of Information Communication," Sustainability, MDPI, vol. 12(2), pages 1-36, January.
    5. Mahmood, Ammara & Luffarelli, Jonathan & Mukesh, Mudra, 2019. "What's in a logo? The impact of complex visual cues in equity crowdfunding," Journal of Business Venturing, Elsevier, vol. 34(1), pages 41-62.
    6. Anglin, Aaron H. & Short, Jeremy C. & Drover, Will & Stevenson, Regan M. & McKenny, Aaron F. & Allison, Thomas H., 2018. "The power of positivity? The influence of positive psychological capital language on crowdfunding performance," Journal of Business Venturing, Elsevier, vol. 33(4), pages 470-492.
    7. Lingfei Deng & Qiang Ye & DaPeng Xu & Wenjun Sun & Guangxin Jiang, 2022. "A literature review and integrated framework for the determinants of crowdfunding success," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 8(1), pages 1-70, December.
    8. Seigner, Benedikt David Christian & McKenny, Aaron F. & Reetz, David K., 2024. "Old but gold? Examining the effect of age bias in reward-based crowdfunding," Journal of Business Venturing, Elsevier, vol. 39(3).
    9. Tafesse, Wondwesen, 2021. "Communicating crowdfunding campaigns: How message strategy, vivid media use and product type influence campaign success," Journal of Business Research, Elsevier, vol. 127(C), pages 252-263.
    10. McSweeney, Jordan J. & McSweeney, Kevin T. & Webb, Justin W. & Devers, Cynthia E., 2022. "The right touch of pitch assertiveness: Examining entrepreneurs' gender and project category fit in crowdfunding," Journal of Business Venturing, Elsevier, vol. 37(4).
    11. Francisca Jiménez-Jiménez & Maria Virtudes Alba-Fernández & Cristina Martínez-Gómez, 2021. "Attracting the Right Crowd under Asymmetric Information: A Game Theory Application to Rewards-Based Crowdfunding," Mathematics, MDPI, vol. 9(21), pages 1-23, October.
    12. Ke Zhao & Hongwei Wang & Wei Wang, 2023. "Women Entrepreneurs Who Break through in Reward-Based Crowdfunding: The Influence of Entrepreneurial Orientation," Sustainability, MDPI, vol. 15(12), pages 1-25, June.
    13. Constantin von Selasinsky & Eva Lutz, 2021. "The Effects of Pro-Social and Pro-Environmental Orientation on Crowdfunding Performance," Sustainability, MDPI, vol. 13(11), pages 1-27, May.
    14. Yalin Wang & Yaokuang Li & Juan Wu & Li Ling & Dan Long, 2023. "Does digitalization sufficiently empower female entrepreneurs? Evidence from their online gender identities and crowdfunding performance," Small Business Economics, Springer, vol. 61(1), pages 325-348, June.
    15. Scheaf, David J. & Davis, Blakley C. & Webb, Justin W. & Coombs, Joseph E. & Borns, Jared & Holloway, Garrett, 2018. "Signals' flexibility and interaction with visual cues: Insights from crowdfunding," Journal of Business Venturing, Elsevier, vol. 33(6), pages 720-741.
    16. Norbert Steigenberger & Hendrik Wilhelm, 2018. "Extending Signaling Theory to Rhetorical Signals: Evidence from Crowdfunding," Organization Science, INFORMS, vol. 29(3), pages 529-546, June.
    17. Francesco Cappa & Michele Pinelli & Riccardo Maiolini & Maria Isabella Leone, 2021. "“Pledge” me your ears! The role of narratives and narrator experience in explaining crowdfunding success," Small Business Economics, Springer, vol. 57(2), pages 953-973, August.
    18. Yang Zhao & Xuemei Xie & Liuyong Yang, 0. "Female entrepreneurs and equity crowdfunding: the consequential roles of lead investors and venture stages," International Entrepreneurship and Management Journal, Springer, vol. 0, pages 1-29.
    19. Boudreau, Kevin J. & Jeppesen, Lars Bo & Reichstein, Toke & Rullani, Francesco, 2021. "Crowdfunding as Donations to Entrepreneurial Firms," Research Policy, Elsevier, vol. 50(7).
    20. Yang Zhao & Xuemei Xie & Liuyong Yang, 2021. "Female entrepreneurs and equity crowdfunding: the consequential roles of lead investors and venture stages," International Entrepreneurship and Management Journal, Springer, vol. 17(3), pages 1183-1211, September.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jobuve:v:15:y:2021:i:c:s2352673421000135. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: https://www.journals.elsevier.com/journal-of-business-venturing-insights .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.