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“All that glitters is not gold!”: The (Unexplored) Determinants of Equity Crowdfunding

Author

Listed:
  • Camilla Civardi

    (Lund University)

  • Andrea Moro

    (Cranfield University)

  • Joakim Winborg

    (Lund University)

Abstract

Drawing from the rich literature in behavioural finance and extensive analysis of forum data from a UK equity crowdfunding platform, we present a comprehensive framework that delineates the investment decision-making process of equity crowdfunders. Our framework captures the utilitarian, emotional, and expressive investment motives that drive crowdfunders, their behaviours and actions during and after the campaign, as well as the challenges they encounter in fulfilling their investment goals. Our work highlights the crucial need to explore the extent to which entrepreneurs and crowdfunding platforms cater to the diverse investment motives and expectations of the crowd. We offer practical insights to entrepreneurs and platforms on how they can better align their strategies with the expectations and needs of equity crowdfunders.

Suggested Citation

  • Camilla Civardi & Andrea Moro & Joakim Winborg, 2024. "“All that glitters is not gold!”: The (Unexplored) Determinants of Equity Crowdfunding," Small Business Economics, Springer, vol. 63(1), pages 299-324, June.
    • Handle: RePEc:kap:sbusec:v:63:y:2024:i:1:d:10.1007_s11187-023-00813-y
    DOI: 10.1007/s11187-023-00813-y
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    More about this item

    Keywords

    Equity crowdfunding; Investment motives; Investment behaviour; Behavioural finance; Start-up; Shareholder activism; Exit;
    All these keywords.

    JEL classification:

    • D26 - Microeconomics - - Production and Organizations - - - Crowd-Based Firms
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship
    • M13 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - New Firms; Startups

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