Is Talking About the Future a Curse or a Blessing? The Effects of Future-Focused Message Framing on Fundraising Performance

Abstract

The growth of crowdfunding has attracted interest from academics and managers alike. Crowdfunders are consumers in the sense that they consume start-up ideas now and their outputs in the future. Given that a crowdfunding platform is almost the only channel for entrepreneurial marketers to interactively communicate with consumers, it is pivotal to study the effectiveness of campaign message design. Thus, the goals of this research are 1) what impact does future-focused message framing have on seeking seed-stage finance when promoting novel ideas to retail investors who may become future consumers? 2) what are other factors that can be further combined as digital communication tools to effectively improve fundraising performance? We collected a dataset of 3,361 reward-based crowdfunding campaigns on Kickstarter, the results of which show that a future-focused campaign has a negative impact on the amount of funds raised. In order to reduce such adverse effects on fundraising, campaigners' extensive engagement is necessary especially when only a handful of reward options are available. This study highlights the critical role of future focus in driving digital communication effectiveness and offers important implications for research and practice.

Environmental Sustainability Orientation, Reward-Based Crowdfunding, and Venture Capital: The Mediating Role of Crowdfunding Performance for New Technology Ventures

“…Our study also contributes by using an investor-as-consumer theoretical lens to understand the underlying dynamics behind the mediation role of reward-based CF in the relationship between the presence of ESO and the attainment of venture capital funding [24], [25], [20]. We suggest that, in the case of technology-based products, in order to understand the decision of providing finance or not, it is pivotal to refer to the consumer nature of the investors.…”

“…First, whether a campaign has a future-focus orientation in the communication with crowdfunders is a characteristic that has been shown to negatively influence CF performance [25]. In principle, this characteristic could be a confounding factor for our first hypothesis.…”

“…It has been claimed that in reward-based CF "crowdfunders mainly contribute in exchange for future products or services, meaning that they behave like general consumers" ( [24], p. 238). Therefore, reward-based CF can be viewed as a channel for early access to products and a form of pre-sale [25]. Accordingly, crowdfunders, despite being generally perceived as investors, behave more like consumers, since they do not seek financial returns for their contributions, rather they just contribute to campaigns in exchange for pre-ordering products [25], [26].…”

“…Therefore, reward-based CF can be viewed as a channel for early access to products and a form of pre-sale [25]. Accordingly, crowdfunders, despite being generally perceived as investors, behave more like consumers, since they do not seek financial returns for their contributions, rather they just contribute to campaigns in exchange for pre-ordering products [25], [26]. As noted in [24], there are more similarities between crowdfunders on rewardbased platforms and online shopping consumers than between crowdfunders on reward-based platforms and professional investors.…”

What Do Crowd Equity Investors Do? Exploring Postinvestment Activities in Equity Crowd Funding

“…Particularly the (re)activation of loose contacts seems to hold significant benefit according to our informal conversations with practitioners. Startups may need to develop new ways of reactivating those loose contacts and building new relationships with their crowd members virtually (e.g., the equity crowdfunding platform) and physically (e.g., events) [56].…”