All failures are not equal: Degree of failure and the launch of subsequent crowdfunding campaigns

Onochie Fan-Osuala

Journal of Business Venturing Insights, 2021, vol. 16, issue C

Abstract: Despite the growing importance of crowdfunding as an alternative source of entrepreneurial finance and in driving innovation, we still have limited understanding of how failure impacts the entrepreneur's subsequent actions and decisions. In this study, we examine how the degree of failure in a crowdfunding campaign affects the entrepreneur's tendency and urgency to launch a subsequent crowdfunding campaign. Using a sample of 63337 entrepreneurs who failed in their initial crowdfunding campaigns and drawing on the near-miss effect, we test a series of hypotheses. Our results suggest that not only does marginal failures increase the likelihood that an entrepreneur will launch a subsequent crowdfunding campaign, it also increases the urgency in which the entrepreneur launches the subsequent crowdfunding campaign. The results reveal that the funding goal size is a moderating factor to the relationship between degree of failure and the launch of a subsequent crowdfunding campaign However, contrary to our expectation, it is such that entrepreneurs whose funding goal size are relatively large are more likely to launch subsequent crowdfunding campaigns.

Keywords: Venture financing; Failure; Crowdfunding; Entrepreneurship; Near miss (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jobuve:v:16:y:2021:i:c:s235267342100038x

DOI: 10.1016/j.jbvi.2021.e00260

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