Entrepreneurial Learning and Disincentives in Crowdfunding Markets
Entrepreneurs use presale feedback from crowdfunding campaigns to decide whether to launch, and this learning most affects those with limited managerial experience or platform history.
Summary
Xu and Ni study reward-based crowdfunding on Kickstarter and find that the information entrepreneurs gather from presale demand meaningfully shapes their decision to proceed with a product launch, particularly for entrepreneurs with low managerial capital or who are new to the platform. Their simulations suggest that platform policies targeting overfunded projects could cut product launch failure rates by about 13%. This positions crowdfunding
Editor's opinion
Narrow crowdfunding-platform mechanism paper, not a firm-strategy lever.
Key concepts
Crowdfunding · Product launch failure · Entrepreneurial learning