Crowdfunding and Social Entrepreneurship: Spotlight on Intermediaries

Understanding the crowdfunding phenomenon and its implications for sustainability

Technological Forecasting and Social Change, 2019

Nonetheless the large body of knowledge rapidly accumulated on crowdfunding as well as the growing relevance of this phenomenon for sustainability, there are very few studies on the role of crowdfunding for sustainabilityoriented projects, and many related issues are still far from being fully understood. This signalises a clear need for unveiling the main dynamics of the relationship between crowdfunding and sustainability, and also opening up useful directions for future research on this relationship. To conceptualize the implications of crowdfunding for sustainability, we propose and use a framework, encompassing five dimensions, namely the project creator, the backers, the campaign itself, the crowdfunding platform, the outcomes of crowdfunding campaigns. By interpreting and fine-tuning the findings emerging from the extant crowdfunding literature to the specific context of sustainability-oriented projects, we develop propositions that provide important implications for this type of initiatives. These implications can guide scholars in finding new paths of research on the topic, as well as provide practitioners with an instrument to better understand the relevance of the crowdfunding phenomenon for sustainable initiatives and make more informed decisions.

The synergistic relationship between crowdfunding and corporate social responsibility: A case study

2020

Crowdfunding is one of the new financing aspects that technology has added in the past decade and has grown significantly to become an alternative source of finance and assisting business projects and social & environmental initiatives. Despite the development and spread of debt-based Crowdfunding significantly, donation-based crowdfunding is also progressing, especially with the growing relationship between crowdfunding and corporate social responsibility (CSR) and through which it is possible to create opportunities to attract funds by crowdfunding platforms. The aim of this paper is to analyze the relationship between Crowdfunding and the principles of CSR. In particular, the study examines whether the adoption of CSR principles in crowdfunding platforms affects the success of funding and the ability of companies and entrepreneurs to access financial resources on the one hand and whether Crowdfunding is an effective means of financing projects that are in line with the objectives...

Crowdfunding and the Role of Managers in Ensuring the Sustainability of Crowdfunding Platforms Third Main Title Line Third Line

Crowdfunding is a new financial system with its own particularities. It is a low-cost way of accessing capital, which increases the potential audience for ideas and ventures, reduces the risk of investment, and provides tailored financing methods for a wide variety of projects. It also provides finance in sectors of activity where finance is difficult to obtain and allows entrepreneurs to test the acceptance of their products in a short period of time. But crowdfunding is also about attracting the emotional interest of users, setting up channels of identification with a platform’s core values and purposes and exploiting the capabilities of social networks, community and proximity. This brings about new interactions between economic efficiency and democratic practices which are distinctive of the crowdfunding market. A particular way of managing the highly idiosyncratic crowdfunding practices seems to have emerged, which underlines the advantages of reinforcing the “economic efficiency-democracy practices” mix (Efficiencracy). Managers interviewed in the study on which this report is based have reported that transparency, participation, learning communities and open-information benefit economic efficiency, and success reinforces democratic practices.

Enacting Social Crowdfunding Business Ecosystems: The case of the platform Meridonare

Technological Forecasting and Social Change, 2019

The paper investigates the emerging practice of social crowdfunding. It focuses on both the role played by crowdfunding platforms and the activities that these platforms perform in enhancing and facilitating the diffusion of social and cultural projects through donations. Crowdfunding platforms empower the financing of projects by soliciting small investments from a large base of potential backers over the Internet and creating a dynamic funding network. However, crowdfunding platforms should also create greater legitimacy for social enterprises by promoting early societal interaction and participation. To explore the context of social crowdfunding, the paper examines the case of the Italian social crowdfunding platform-Meridonare-by using both primary and secondary data sources. Findings reveal that, beyond acting as a standard crowdfunding platform, Meridonare eases interactions and relationships among different stakeholders. The emerging set of relationships gives rise to a Social Crowdfunding Business Ecosystem (SCBE), with the crowdfunding platform acting as a hub to enact knowledge sharing and service provision to a plethora of different actors.

The effects of creator credibility and backer endorsement in donation crowdfunding campaigns success

Baltic Journal of Management, 2019

Purpose The purpose of this paper is to investigate the effects of creator credibility and backer endorsement on the levels of donation to crowdfunding campaigns in a focal muslim community and to determine the success factors of projects in developing and developed countries. Design/methodology/approach This research adopts a quantitative approach, utilizing 223 crowdfunding projects from LaunchGood to examine the expected connections. The crowdfunding projects in the distinctive data set (Ramadan) are similar, permitting exploration of the role of creator credibility and backer endorsement in a unique context of religious-based crowdfunding activity. Findings Creators’ credibility and backers’ endorsements are decisive factors in crowdfunding success. Results from an additional test related to location (developing and developed countries) suggest that creators’ credibility is more important than backers’ endorsements, especially in developing countries. Research limitations/implic...

Crowdfunding and the Role of Managers in Ensuring the Sustainability of Crowdfunding Platforms

Crowdfunding is a new financial system with its own particularities. It is a low-cost way of accessing capital, which increases the potential audience for ideas and ventures, reduces the risk of investment, and provides tailored financing methods for a wide variety of projects. It also provides finance in sectors of activity where finance is difficult to obtain and allows entrepreneurs to test the acceptance of their products in a short period of time.But crowdfunding is also about attracting the emotional interest of users, setting up channels of identification with a platform’s core values and purposes and exploiting the capabilities of social networks, community and proximity. This brings about new interactions between economic efficiency and democratic practices which are distinctive of the crowdfunding market. A particular way of managing the highly idiosyncratic crowdfunding practices seems to have emerged, which underlines the advantages of reinforcing the “economic efficienc...

How do we study crowdfunding? An overview of methods and introduction to new research agenda (2018)

2018

Purpose: Crowdfunding is a global phenomenon of rising significance and impact on different areas of business and social life, investigated across many academic disciplines. The goal of the article is to present the variety of methods applied in crowdfunding research, assess their strengths and weaknesses, offer the typology of methodological approaches, and suggest the most promising direction for further studies. Design/methodology: The paper is based on the review of the most recent academic and industry lite rature on crowdfunding and own analysis of data presented by crowdfunding platforms' operators. Findings: The article incorporates interrelations of methods, goals of inquiries, and types of results to propose a typology of methodological approaches that researchers currently apply to crowdfund ing: from platformcentred to multisited. The authors discuss the advantages and limitations of the identified approaches with the use of multiple examples of recent and most influential studies from the field and propose the most urgent direction of future inquiries. Research limitations/implications: The overview renders crowdfunding studies more accessible for potential newcomers to the field and strengthens transdisciplinary discussion on crowdfunding. Despite the broad variety of the analyzed articles that reflect the newest trends, the sample is not representative in the statistical meanings of the term. Originality/value: The article offers the first review of methodologies applied in the transdisciplinary area of crowdfunding studies and connects it to broader methodological discussions about trans disciplinary research on the digital phenomena. The review strengthens the transdisciplinary dialog on crowdfunding.

How do we study crowdfunding? An overview of methods and introduction to new research agenda

Journal of Management and Business Administration. Central Europe, 2018

Community Engagement and Collective Evaluation in Crowdfunding

SSRN Electronic Journal, 2015

The emergence of crowdfunding could significantly ease the burden of raising funds for startup companies, and ultimately transform the nature of entrepreneurship and new firm creation. Under traditional funding mechanisms, entrepreneurs face considerable difficulties in obtaining external funding. Start-ups also struggle to increase their visibility and establish legitimacy to acquire necessary resources. In contrast to traditional funding, the role of crowdfunding platforms in connecting entrepreneurs and funders provides new avenues for entrepreneurs to acquire legitimacy and to engage with a pool of funders. Using the comprehensive theoretical lens of social network theory and electronic word-of-mouth, we examine the impact of crowds' and entrepreneurs' behaviors along with entrepreneur characteristics on crowdfunding success. We collect data about startup projects and funders from a reward-based crowdfunding platform in the U.S., as well as additional data from online social network sites and blogs. Our sample includes a total of 722 technology-related projects (March 2012-January 2013) and more than 177,700 funders. The empirical results show that the networks of interactions among funders as well as the entrepreneurs' social engagement with the crowdfunding community are key antecedents of funding success. Interestingly, these factors dominate the effects of the entrepreneurs' characteristics. This study contributes to crowdfunding, crowdsourcing, and entrepreneurship literature by providing a comprehensive framework to understand the fundraising mechanisms in a novel funding. Implications for potential funders and entrepreneurs are discussed.

Is Crowdfunding an Appropriate Financial Model for Social Entrepreneurship

Academy of Entrepreneurship Journal, 2017

The principal characteristic of social entrepreneurship is the creation of businesses with the objectives of solving social issues and generating positive impacts in the community. In recent years there has been an increase in the literature addressing these types of businesses, although the number of works dealing specifically with how they are funded is quite limited, and even more so in the case of those which focus on alternative financing options such as crowdfunding. Therefore, the main objective of this paper is to assess the use of crowdfunding as a source of finance for social enterprises. Specifically, the paper analyzes social entrepreneurs’ perceptions of crowdfunding, the reasons that drive or impede its use, the different information available, and its suitability for social enterprises. A study is carried out on social entrepreneurs in Spain using the Delphi method, especially recommended as a methodology for exploratory studies such as this. The results show that cro...

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