Understanding the overfunding in crowdfinancing: the elements of attractiveness

Joanna Adamska-Mieruszewska , Urszula Mrzygłód , Marcin Skurczyński

Abstract

Crowdfunding projects are subject to the evaluation of the online community, which participates in the financing process on an entirely voluntary basis. This unique feature of crowdfunding increases the importance of project’s owner communication and presenting skills to increase project attractiveness to its target group of recipients. In the all-or-nothing crowdfunding model, most of the projects that have successfully gained financing exceed the financial goal by only a small amount, which makes them only slightly overfunded. However, a limited number of projects have enticed a relatively high number of people into financing them, and, as a result, these projects are strongly overfunded. Based on a unique dataset of 814 overfunded projects, we investigate the drivers of the overfunding success stories. Along with standard statistical measures, we conduct logit regressions. Our results give evidence that the lower the requested amount and the higher the number of supporters, the higher the probability becomes that the project will be strongly overfunded. Moreover, our findings confirm that an active attitude of the project’s owner, as seen through news reports and previous project experience, and crowd participation, as seen through the number of comments, have the positive influence on the probability of a higher overfunding rate.
Author Joanna Adamska-Mieruszewska (FE / IIB)
Joanna Adamska-Mieruszewska,,
- Institute of International Business
, Urszula Mrzygłód (FE / IIB)
Urszula Mrzygłód,,
- Institute of International Business
, Marcin Skurczyński (FE / IIB)
Marcin Skurczyński,,
- Institute of International Business
Pages167-174
Publication size in sheets0.5
Book Jajuga Krzysztof, Locarek-Junge Hermann, Orłowski Lucjan T., Staehr Karsten (eds.): Contemporary Trends and Challenges in Finance: proceedings from the 4th Wroclaw International Conference in Finance, Springer Proceedings in Business and Economics, 2019, Springer International Publishing, ISBN 978-3-030-15580-3, [978-3-030-15581-0], 225 p., DOI:10.1007/978-3-030-15581-0
Keywords in Englishcrowdfunding, overfunding, determinants
DOIDOI:10.1007/978-3-030-15581-0_16
URL https://rd.springer.com/content/pdf/10.1007%2F978-3-030-15581-0_16.pdf
Languageen angielski
Score (nominal)15
ScoreMinisterial score = 15.0, 07-08-2019, ChapterFromConference
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