Innovation and Entrepreneurship Research

Signaling Effects of Crowdfunding on Venture Investors’ Decision Making

The financing of new ventures is a central issue in the economics of entrepreneurship and the diffusion of radical innovation. Crowdfunding is emerging as a novel way for entrepreneurs to secure scarce early-stage financing. With venture capital still being the most important source of funding for young innovative firms in later stages, it is important to study the interactions between new and traditional forms of venture financing. This dissertation examines the impact and signaling effects that crowd-based financing has on subsequent venture capital funding rounds. Drawing on choice experimental research designs the thesis finds causal evidence that while the crowd is generally seen as a negative signal, under certain circumstances it may generate positive signals to which professional venture investors react in their decision making.



Dr. Michael Mödl


Prof. Dietmar Harhoff, Ph.D