Exploring the determinants of success and failure in crowdfunding: A Platform Approach

Crowdfunding is a global phenomenon for funding new ventures and projects, through the utilisation of crowdfunding platforms. This work focusses on the creation of a theoretical framework for determining success and failure within crowdfunding platforms. The framework is built utilising the existing crowdfunding literature and integrating it within a wider context considering signalling theory, social capital theory, network analysis, competition effects and backer motivations. The contextual framework, designed to be applicable regardless of type of crowdfunding platform examined, is applied to two separate crowdfunding platforms, Kickstarter and Kiva. This framework is then utilised for developing specific hypotheses for each platform around each of the salient themes identified from the relevant literature. These hypotheses are empirically tested on original data from over 55,000 crowdfunding campaigns, collected using web crawlers and API protocols. Moreover, by introducing the ideas of enforced and voluntary signals within a Crowdfunding context, this work also extends the set of relevant concepts originally derived from signalling theory. This thesis also introduces the concepts of formation of latent networks, and the tools for their analysis, to examine the internal social capital of a crowdfunding platform. With this work arguing, and providing evidence, that increased internal social capital has a positive impact on crowdfunding success. Finally, these findings are utilized in creating a set of recommendation to the crowdfunding participants.