Direkt zum Inhalt

Access to Digital Finance: Equity Crowdfunding across Countries and Platforms

Discussion Papers 2064, 27 S.

Saul Estrin, Susanna Khavul, Alexander S. Kritikos, Jonas Löher

2023

get_appDownload (PDF  338 KB)

Published in: PLoS ONE 19 (2024),1, e0293292, 17 S.

Abstract

Financing entrepreneurship spurs innovation and economic growth. Digital financial platforms that crowdfund equity for entrepreneurs have emerged globally, yet they remain poorly understood. We model equity crowdfunding in terms of the relationship between the number of investors and the amount of money raised per pitch. We examine heterogeneity in the average amount raised per pitch that is associated with differences across three countries and seven platforms. Using a novel dataset of successful fundraising on the most prominent platforms in the UK, Germany, and the USA, we find the underlying relationship between the number of investors and the amount of money raised for entrepreneurs is loglinear, with a coefficient less than one and concave to the origin. We identify significant variation in the average amount invested in each pitch across countries and platforms. Our findings have implications for market actors as well as regulators who set competitive frameworks.



JEL-Classification: D26;G23;G41;L26
Keywords: equity crowdfunding, soft information, entrepreneurship, finance, financial access and inclusion

keyboard_arrow_up