How much is too much? The effects of information quantity on crowdfunding performance

Naomi Moy, Ho Fai Chan and Benno Torgler

PLOS ONE, 2018, vol. 13, issue 3, 1-15

Abstract: We explore the effects of the quantity of information on the tendency to contribute to crowdfunding campaigns. Using the crowdfunding platform Kickstarter, we analyze the campaign descriptions and the performance of over 70,000 projects. We look empirically at the effect of information quantity (word count) on funding success (as measure by amount raised and number of backers). Within this empirical approach, we test whether an excessive amount of information will affect funding success. To do so, we test for the non-linearity (quadratic) effect of our independent variable (word count) using regression analysis. Consistent with the hypothesis that excess information will negatively affect funds raised and number of contributors, we observe a consistent U-shaped relationship between campaign text length and overall success which suggest that an optimal number of words exists within crowdfunding texts and that going over this point will reduce a project’s chance of fundraising success.

Date: 2018
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Citations: View citations in EconPapers (12)

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Persistent link: https://EconPapers.repec.org/RePEc:plo:pone00:0192012

DOI: 10.1371/journal.pone.0192012

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