The Dark Side of Machiavellian Rhetoric: Signaling in Reward-Based Crowdfunding Performance

Goran Calic (), Rene Arseneault () and Maryam Ghasemaghaei ()
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Goran Calic: McMaster University
Rene Arseneault: University of Regina
Maryam Ghasemaghaei: McMaster University

Journal of Business Ethics, 2023, vol. 182, issue 3, No 15, 875-896

Abstract: Abstract In this study, we explore the impact of Machiavellian rhetoric on fundraising within the increasingly important context of online crowdfunding. The “all-or-nothing” funding model used by the world’s largest crowdfunding platform, Kickstarter, may be an attractive context in which entrepreneurs can utilize Machiavellian rhetoric to reach their funding goal, lest they get no funding at all. This study uses data from 76,847 crowdfunding projects posted on kickstarter.com and develops a dictionary for computer-aided text analysis (CATA) of Machiavellian rhetoric to measure the relationship between the frequency of Machiavellian rhetoric use and crowdfunding performance, operationalized as either reaching a funding goal or the number of backers who funded the project. Machiavellian rhetoric is segregated into eight facets, which are categorized into hard and soft influence tactics. Hard tactics include revenge, intimidation, betrayal, and manipulation. Soft tactics include ingratiation, supplication, self-disclosure, and persuasion. Results reveal that signals of revenge, self-disclosure, and intimidation have negative effects, whereas signals of ingratiation and persuasion have mixed positive effects on crowdfunding performance. Ingratiation is found to increase the number of backers, but not funding success. Conversely, persuasion is found to increase funding success, but not the number of backers. Surprisingly, betrayal rhetoric is positively related to both measures of crowdfunding performance. Thus, this article complements the literature on backer decision-making, entrepreneurial methods, reward-based crowdfunding, and ethics in entrepreneurship by demonstrating how the displays of potentially negative phenomena, such as Machiavellianism, have complex consequences for entrepreneurial outcomes.

Keywords: Dark side phenomena; Signaling theory; Entrepreneurship (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (2)

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DOI: 10.1007/s10551-021-04984-0

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