Why do video pitches matter in crowdfunding?

Kolbe, Maura; Mansouri, Sasan; Momtaz, Paul P.

doi:10.1016/j.jeconbus.2022.106081

Cited by 16 publications

(6 citation statements)

References 83 publications

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“…H3-1 and H3-2 are not supported. However, Kolbe et al (2022) confirmed that video pitches helped startups achieve higher valuations. The variable reflecting the cost dimension, the investment threshold, has a significant and negative effect on the number of early backers, with a correlation coefficient of 20.230 at the 1% level, thus supporting H4.…”

Section: Dumentioning

confidence: 75%

Rational or Impulsive? Early Backers’ Investment Behavior in Agri-Food Crowdfunding from 4P–4C Perspectives

2023

Sage Open

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Lack of funds and poor agricultural-product sales are the main problems that limit agricultural development, which can be well solved by agri-food crowdfunding. How to attract more backers to invest in the early stage of a project is extremely crucial for agri-food crowdfunding. Using a unique sample comprising 1,136 agri-food crowdfunding campaigns on Crowdfunding Net, among the most influential crowdfunding platforms in China, a model is constructed that includes the five dimensions of people, product, promotion, cost, and convenience. Drawing on the classic 4P and 4C marketing theories, multiple regression analysis is used to examine the mechanism through which a project’s presentation information influences the number of early backers. The results reveal that the factors in the three dimensions of people, product, and convenience positively impact the number of early backers in agri-food crowdfunding. In contrast, the cost-dimension factor is negatively related to the number of early backers. The promotion-dimension factors fail to pass the significance test. Additionally, the number of first-day backers partially moderates the effect of the initiator category, investment threshold, and lottery on the number of early backers. The effects of the trademark registration and number of reward categories on the number of early backers are completely moderated by the number of first-day backers. The evidence also shows that early backers’ rational investment decisions are based on reliable information and lucrative rewards. The research conclusions offer practical enlightenment for initiators, crowd-funding platforms, and regulators in the agri-food crowdfunding industry.

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Section: Dumentioning

confidence: 75%

Rational or Impulsive? Early Backers’ Investment Behavior in Agri-Food Crowdfunding from 4P–4C Perspectives

2023

Sage Open

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“…Recent research suggests that, in different situations, investors or backers prefer different communication tools. While a study on initial coin offerings (ICO) reported 133% higher funding amounts when a video pitch was published (Kolbe et al, 2022), another study found evidence that potential backers prefer detailed textual descriptions over videos. They even found that a video negatively affected backers' attitudes towards investing, especially in a crowdfunding context, like the one used in this master's thesis (Lagazio & Querci, 2018).…”

Section: Characteristics Of the Decision Maker And Optionsmentioning

confidence: 99%

“…There is a growing body of literature highlighting the positive influence of campaign videos and video pitches on the success rate of crowdfunding campaigns. Most of the previous research found evidence for a positive correlation between the availability of a video pitch and funding success (e.g., Anglin et al, 2018;Cumming et al, 2017;Courtney et al, 2017;Johan & Zhang, 2020;Kolbe et al, 2022;Li et al, 2016;Mollick, 2014). Lagazio & Querci (2018), however, argue that a video does not necessarily lead to higher funding success.…”

Section: Introductionmentioning

confidence: 99%

The Role of Emotions in Investment Decisions: The Effects of Vividness of a Crowdfunding Campaign Video

Sander

2024

Preprint

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Current research in the domain of crowdfunding often overlooks the role of emotions in investment decision-making and the impact of varying vividness in campaign videos. Employing the Emotion-Imbued Choice Model (Lerner et al., 2015), this study investigates how different levels of a campaign video’s vividness shape emotions and the subsequent investment decision. Utilizing a quantitative approach with a between-group design, participants were exposed to either a campaign video, or an infographic accompanied by identical audio. Emotional reactions were analyzed via TAWNY, a deep learning tool for facial emotion recognition. Additionally, questionnaires assessed investment decisions, self-reported emotions, and evaluations of the stimulus. The findings suggest that emotions are likely to play an informative role throughout the decision-making process. Results show that the group receiving the infographic was more likely to invest, supporting the findings of Lagazio and Querci (2018). As posited by Dey et al. (2017), a crowdfunding video does not necessarily lead to higher crowdfunding chances. Notably, the mediating role of the conscious evaluation differs concerning idea and video evaluation, showing different effects on the relationship between current emotions and the outcome, that is, the investment decision and self-reported emotions. These findings align with the assumption of System 1 and System 2 thinking (Kahneman, 2011). Additionally, the lack of direct effects of current emotions on the outcome suggests the potential for a full mediation by the conscious evaluation, supporting modern decision-making theories (Lerner et al., 2015; Loewenstein et al., 2001).

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“…North America ranks first (USD 17.2 billion), followed by Asia (USD 10.5 billion) and Europe (USD 6.5 billion). 2 Cumming et al (2017) and Kolbe et al (2022) show that videos are a costly signal as these require the development of a prototype that can be showcased. 3 Kickstarterthe world's largest platformis the most analysed platform (Courtney et al, 2017;Kuppuswamy & Bayus, 2018;Mollick, 2014).…”

Section: Conflict Of Interest Statementmentioning

confidence: 99%

Do project quality and founder information signals always matter? Evidence from equity and reward crowdfunding

Huang

Kabir

Nguyen³

2023

Int. J Fin Econ

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This study provides a comparative analysis of the success factors of equity and reward‐based crowdfunding. We find that information signals related to venture/project quality are important determinants of both equity‐based and reward‐based crowdfunding success. However, signals on founder information matter only for equity‐based but not for reward‐based crowdfunding. Our study exemplifies the varying role of success factors that depend on the type of crowdfunding projects and provides a basis for further research to compare different forms of crowdfunding.

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Why do video pitches matter in crowdfunding?

Cited by 16 publications

References 83 publications

Rational or Impulsive? Early Backers’ Investment Behavior in Agri-Food Crowdfunding from 4P–4C Perspectives

Rational or Impulsive? Early Backers’ Investment Behavior in Agri-Food Crowdfunding from 4P–4C Perspectives

The Role of Emotions in Investment Decisions: The Effects of Vividness of a Crowdfunding Campaign Video

Do project quality and founder information signals always matter? Evidence from equity and reward crowdfunding

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