Investors or Givers ? The Case of a Portuguese Crowdfunding Site

Abstract

Abstract. This is the first paper studying the determinants behind the different values raised by project and by investor using data collected from Portuguese crowdfunding platforms. We concluded that higher prize-moneys, expanded ad duration, and stating that the investment will be used for multiple ends tend to maximize the value that investors send to projects. However, there is a downtrend of the raised values observed at the most recent years that generates additional challenges for all interested on building, managing and promoting web-crowdfunding platforms.

Many Are Never Too Many: An Analysis of Crowdfunding Projects in Brazil

“…Overall, the R2 is high for the estimations regarding total raised value per project, but it is low for the estimations regarding percentage of target and raised value per investor. This aligns with the study by Mourão and Costa (2015) and can be interpreted as evidence of the individual motivations behind each one of these investments, which further generate opportunities of research in order to explore other scientific explanations for explaining the values invested by each sponsor. The tests on endogeneity returned significant values, which prove the exogeneity of the instruments.…”

“…Three dependent variables were detailed by Mourão and Costa (2015) when they analyzed determinants of crowdfunding projects observed for the Portuguese PPL Crowdfunding: the total value raised by the project, the value raised by the investor, and the target percentage. Independent variables considered in the model were: year, duration of application, number of supporters, type of promoters, population density of the municipality of the promoters, number of applicants, project validity, minimum invested with maximum reward, minimum invested with reward, and the number of targets for the collected money.…”

“…For example, a campaign promoted by a chamber music quartet from São Caetano do Sul to record a CD offered as a minimum reward the CD itself for those who donated US$2, and as a maximum reward, an exclusive concert for those who donated US$335. Mourão and Costa (2015) concluded that incentives are essential to the success of a crowdfunding campaign.…”

“…According to Mourão and Costa (2015), in crowdfunding projects, the investor may not gain a tangible benefit. There are two main forms of campaign modalities: (i) the promoter only receives the money if the target is fully achieved during the campaign and (ii) the promoter gets everything regardless of whether or not the campaign's target is achieved.…”

An Empirical Study on Influencing Factors of Crowdfunding Successes Based on Customer Delivered Value Theory

“…After an empirical study based on projects on Kickstarter, Kuppuswamy and Bayus concluded that when investing, investors are influenced by constellation effect [1]. According to Mourao, the result of a CF project relies largely on the founder's social network and social status [2].…”