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Directing the wisdom of the crowd: the importance of social interaction among founders and the crowd during crowdfunding campaigns

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  • Thomas Clauss
  • Robert J. Breitenecker
  • Sascha Kraus
  • Alexander Brem
  • Chris Richter

Abstract

Crowdfunding plays an important role as an alternative funding source for technology ventures. No earlier studies particularly investigated the importance of social interactions during such crowdfunding campaigns. Hence, we particularly take the interaction between the project owner and the community as well as among community members into account. We empirically investigated potential success factors for crowdfunding projects of entrepreneurs on the base of 430 projects from the German crowdfunding platform Visionbakery. Our results show that social interaction during a crowdfunding campaign indeed increases the likelihood of its success. As comments from crowd members on particular projects might be positive or negative and can also provide additional argumentation or raise questions, comments can cause a dialog among crowd members. This shows that herding might not only be related to the number of contributors but also to their shared attributes and perceptions. Our discussion of theoretical and managerial implications closes with recommendations for future research on this evolving topic.

Suggested Citation

  • Thomas Clauss & Robert J. Breitenecker & Sascha Kraus & Alexander Brem & Chris Richter, 2018. "Directing the wisdom of the crowd: the importance of social interaction among founders and the crowd during crowdfunding campaigns," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 27(8), pages 709-729, November.
    • Handle: RePEc:taf:ecinnt:v:27:y:2018:i:8:p:709-729
    DOI: 10.1080/10438599.2018.1396660
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    Cited by:

    1. Bagheri, Afsaneh & Chitsazan, Hasti & Ebrahimi, Ashkan, 2019. "Crowdfunding motivations: A focus on donors' perspectives," Technological Forecasting and Social Change, Elsevier, vol. 146(C), pages 218-232.
    2. Piazza, Mariangela & Mazzola, Erica & Perrone, Giovanni, 2022. "How can I signal my quality to emerge from the crowd? A study in the crowdsourcing context," Technological Forecasting and Social Change, Elsevier, vol. 176(C).
    3. Salahaldin, Linda & Angerer, Martin & Kraus, Sascha & Trabelsi, Donia, 2019. "A duration-based model of crowdfunding project choice," Finance Research Letters, Elsevier, vol. 29(C), pages 404-410.
    4. Wachs, Johannes & Vedres, Balázs, 2021. "Does crowdfunding really foster innovation? Evidence from the board game industry," Technological Forecasting and Social Change, Elsevier, vol. 168(C).
    5. Jinbi Yang & Libo Liu & Chunxiao Yin, 2019. "A Non-Liner Decision Model for Green Crowdfunding Project Success: Evidence from China," IJERPH, MDPI, vol. 16(2), pages 1-12, January.
    6. Felipe, Israel José dos Santos & Mendes-Da-Silva, Wesley & Leal, Cristiana Cerqueira & Braun Santos, Danilo, 2022. "Reward crowdfunding campaigns: Time-to-success analysis," Journal of Business Research, Elsevier, vol. 138(C), pages 214-228.
    7. Nikolaus Lipusch & Dominik Dellermann & Ulrich Bretschneider & Philipp Ebel & Jan Marco Leimeister, 2020. "Designing for Crowdfunding Co-creation," Business & Information Systems Engineering: The International Journal of WIRTSCHAFTSINFORMATIK, Springer;Gesellschaft für Informatik e.V. (GI), vol. 62(6), pages 483-499, December.
    8. Chu, Tiankuo & Wei, Xu & Zhou, Yimin, 2021. "The pricing and efficiency of pre-Sale crowdfunding," Finance Research Letters, Elsevier, vol. 40(C).
    9. Zhao, Liang & Shneor, Rotem & Sun, Zhe, 2022. "Skin in the game: Self-funding and reward crowdfunding success," Business Horizons, Elsevier, vol. 65(1), pages 89-100.
    10. Tobias Regner, 2021. "Crowdfunding a monthly income: an analysis of the membership platform Patreon," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 45(1), pages 133-142, March.
    11. René Vásquez-Ordóñez, Luis & Lassala, Carlos & Ulrich, Klaus & Ribeiro-Navarrete, Samuel, 2023. "Efficiency factors in the financing of renewable energy projects through crowdlending," Journal of Business Research, Elsevier, vol. 155(PB).
    12. Thomas Niemand & Sascha Kraus & Martin Angerer & Ferdinand Thies & Alicia Mas-Tur, 2019. "More is not always better—non-linear effects in crowdfunding," International Journal of Quality Innovation, Springer, vol. 5(1), pages 1-10, December.
    13. Thomas Clauss & Thomas Niemand & Sascha Kraus & Patrick Schnetzer & Alexander Brem, 2019. "Increasing Crowdfunding Success Through Social Media: The Importance Of Reach And Utilisation In Reward-Based Crowdfunding," International Journal of Innovation Management (ijim), World Scientific Publishing Co. Pte. Ltd., vol. 24(03), pages 1-30, May.
    14. 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.
    15. Righi, Riccardo & Pedrazzoli, Alessia & Righi, Simone & Venturelli, Valeria, 2024. "The clientele effects in equity crowdfunding: A complex network analysis," Journal of Behavioral and Experimental Finance, Elsevier, vol. 42(C).
    16. Laura Grassi & Simone Fantaccini, 2022. "An overview of Fintech applications to solve the puzzle of health care funding: state-of-the-art in medical crowdfunding," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 8(1), pages 1-27, December.
    17. Han-Chiang Ho & Candy Lim Chiu & Somkiat Mansumitrchai & Zhengqing Yuan & Nan Zhao & Jiajie Zou, 2021. "The Influence of Signals on Donation Crowdfunding Campaign Success during COVID-19 Crisis," IJERPH, MDPI, vol. 18(14), pages 1-25, July.
    18. Saleh Al-Omoush, Khaled & Orero-Blat, Maria & Ribeiro-Soriano, Domingo, 2021. "The role of sense of community in harnessing the wisdom of crowds and creating collaborative knowledge during the COVID-19 pandemic," Journal of Business Research, Elsevier, vol. 132(C), pages 765-774.
    19. Christian Handke & Carolina Dalla Chiesa, 2022. "The art of crowdfunding arts and innovation: the cultural economic perspective," Journal of Cultural Economics, Springer;The Association for Cultural Economics International, vol. 46(2), pages 249-284, June.
    20. Peter Konhäusner & Bing Shang & Dan-Cristian Dabija, 2021. "Application of the 4Es in Online Crowdfunding Platforms: A Comparative Perspective of Germany and China," JRFM, MDPI, vol. 14(2), pages 1-19, January.
    21. Hörisch, Jacob & Tenner, Isabell, 2020. "How environmental and social orientations influence the funding success of investment-based crowdfunding: The mediating role of the number of funders and the average funding amount," Technological Forecasting and Social Change, Elsevier, vol. 161(C).

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