Working Paper: NBER ID: w26275
Authors: Thomas Hellmann; Ilona Mostipan; Nir Vulkan
Abstract: We use equity crowdfunding data to ask how fundraising amounts can be explained by what entrepreneurs ask for, versus what investors want to invest. The analysis exploits unique features of crowdfunding where entrepreneurs not only set investment goals, but also chose when to close their campaigns. More experienced and more educated founder teams ask for more. Their campaigns succeed more often, and they raise more money. Female teams ask for less, are equally successful, yet raise significantly less. They also wait longer before closing campaigns, suggesting they want to raise more than what they originally asked for.
Keywords: Equity Crowdfunding; Fundraising Strategies; Entrepreneurial Experience; Gender Dynamics
JEL Codes: G20; G24; M13
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| founder experience (M13) | higher fundraising goals (L21) |
| founder experience (M13) | campaign success (D79) |
| higher fundraising goals (L21) | higher amounts raised (H27) |
| founder experience (M13) | fundraising strategy (L21) |
| more educated teams (I25) | higher fundraising goals (L21) |
| more educated teams (I25) | higher total amounts raised (H27) |
| more educated teams (I25) | higher valuations (G19) |
| more educated teams (I25) | higher total amounts raised through funding goals (Z23) |
| female teams (Z22) | lower fundraising goals (L21) |
| lower fundraising goals (L21) | lower amounts raised (H27) |
| female teams (Z22) | campaign success (D79) |
| female teams (Z22) | hold out longer before closing campaigns (C41) |