Choosing Crowdfunding: Why do Entrepreneurs Choose to Engage in Crowdfunding?

Louise Bech Junge, Iben Cleveland Laursen, Kristian Roed Nielsen*

*Corresponding author for this work

Research output: Contribution to journalJournal articleResearchpeer-review

Abstract

As crowdfunding becomes an increasingly common source of financing for a diverse range of entrepreneurs, this paper seeks to add to the literature by qualitatively exploring why entrepreneurs choose to engage in crowdfunding. We find that entrepreneurs often engage in crowdfunding as a first resort with three distinct motives; to raise capital, to validate a business idea, or to create brand awareness. Especially reward-based crowdfunding is often seen as a tool for validate a business idea or generating awareness not as a source of finance. Finally we observe that entrepreneurs’ motives for engaging in crowdfunding often correlate with their maturity and thus motivations for engaging in crowdfunding shift as they mature.
Original languageEnglish
Article number102385
JournalTechnovation
Number of pages10
ISSN0166-4972
DOIs
Publication statusPublished - 9 Sep 2021

Bibliographical note

Epub ahead of print. Published online: 9 September 2021.

Keywords

  • Crowdfunding
  • Entrepreneurship
  • Finance
  • Life cycle
  • Motivation

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