The interaction of equity crowdfunding platforms and ventures: an analysis of the preselection process

Venture Capital

Volumn 19, Issue 1-2, 2017, Pages 51-74

  Löher, Jonas ^a  

^a IfM Bonn Institut für Mittelstandsforschung   (Germany)

Author keywords

Crowdfunding; crowdfunding platforms; crowdinvesting; entrepreneurial finance; entrepreneurship; equity crowdfunding; two sided markets

Indexed keywords

EID: 84995407488     PISSN: 13691066     EISSN: 14645343     Source Type: Journal    
DOI: 10.1080/13691066.2016.1252510     Document Type: Article

References (60)

1. Agrawal, Ajay, Christian, Catalini, and Avi, Goldfarb. 2015. “Crowdfunding:Geography, Social Networks, and the Timing of Investment Decisions.” Journal of Economics & Management Strategy 24 (2):253–274. doi:10.1111/jems.12093.
2. Ahlers, Gerrit K. C., Douglas, Cumming, Christina, Günther, and Denis, Schweizer. 2015. “Signaling in Equity Crowdfunding.” Entrepreneurship Theory & Practice 39 (4):955–980. doi:10.1111/etap.12157.
3. Backes-Gellner, Uschi, and Arndt, Werner. 2007. “Entrepreneurial Signaling via Education:A Success Factor in Innovative Start-ups.” Small Business Economics 29 (1–2):173–190. doi:10.1007/s11187-006-0016-9.
4. Belleflamme, P., and T., Lambert. 2014. “Crowdfunding:Some Empirical Findings and Microeconomic Underpinnings.” SSRN 4:doi:10.2139/ssrn.2437786.
5. Belleflamme, Paul, Thomas, Lambert, and Armin, Schwienbacher. 2014. “Crowdfunding:Tapping the Right Crowd.” Journal of Business Venturing 29 (5):585–609. doi:10.1016/j.jbusvent.2013.07.003.
6. Belleflamme, Paul, Nessrine, Omrani, and Martin, Peitz. 2015. “The Economics of Crowdfunding Platforms.” Information Economics & Policy 33 (Dec.):11–28. doi:10.1016/j.infoecopol.2015.08.003.
7. Bradford, C. Steven. 2012. “Crowdfunding and the Federal Securities Laws.” Columbia Business Law Review 2012 (1). http://papers.ssrn.com/sol3/Papers.cfm?abstract_id=1916184.
8. Brettel, Malte. 2003. “Business Angels in Germany:A Research Note.” Venture Capital 5 (3):251–268. doi:10.1080/1369106032000122095.
9. Brush, Candida G., Linda F., Edelman, and Tatiana S., Manolova. 2012. “Ready for Funding? Entrepreneurial Ventures and the Pursuit of Angel Financing.” Venture Capital 14 (2–3):111–129. doi:10.1080/13691066.2012.654604.
10. Burchardt, Jens, Ulrich, Hommel, Dzidziso Samuel, Kamuriwo, and Carolina, Billitteri. 2014. “Venture Capital Contracting in Theory and Practice:Implications for Entrepreneurship Research.” Entrepreneurship Theory & Practice 40 (May):25–48. doi:10.1111/etap.12104.
11. Carpentier, Cécile, and Jean-Marc, Suret. 2015. “Canadian Business Angel Perspectives on Exit:A Research Note.” International Small Business Journal 33 (5):582–593. doi:10.1177/0266242613516140.
12. Cassar, Gavin. 2004. “The Financing of Business Start-ups.” Journal of Business Venturing 19 (2):261–283. doi:10.1016/S0883-9026(03)00029-6.
13. Corbin, Juliet M., and Anselm, Strauss. 1990. “Grounded Theory Research:Procedures, Canons, and Evaluative Criteria.” Qualitative Sociology 13 (1):3–21. doi:10.1007/BF00988593.
14. Croce, Annalisa, Francesca, Tenca, and Elisa, Ughetto. 2016. “How Business Angel Groups Work:Rejection Criteria in Investment Evaluation.” International Small Business Journal. Forthcoming. doi:10.1177/0266242615622675.
15. Cumming, Douglas J., Gaël, Leboeuf, and Armin, Schwienbacher. 2015. Crowdfunding Models:Keep-it-all Vs. All-or-nothing. SSRN Scholarly Paper ID:2447567. Rochester, NY:Social Science Research Network. http://papers.ssrn.com/abstract=2447567.
16. Denzin, Norman. 1970. The Research Act in Sociology:A Theoretical Introduction to Sociological Methods. Chicago, IL:Aldine.
17. Edmondson, Amy C., and Stacy E., Mcmanus. 2007. “Methodological Fit in Management Field Research.” Academy of Management Review 32 (4):1155–1179. doi:10.5465/AMR.2007.26586086.
18. Eisenhardt, Kathleen M., and Melissa E., Graebner. 2007. “Theory Building From Cases:Opportunities and Challenges.” Academy of Management Journal 50 (1):25–32. doi:10.5465/AMJ.2007.24160888.
19. Eisenmann, Thomas R., Geoffrey, Parker, and Marshall W., van Alstyne. 2008. “Opening Platforms:How, When and Why?” Harvard Business School Entrepreneurial Management Working Paper No. 09-030. doi:10.2139/ssrn.1264012.
20. Fiet, James O., 1995. “Risk Avoidance Strategies in Venture Capital Markets.” Journal of Management Studies 32 (4):551–574. doi:10.1111/j.1467-6486.1995.tb00788.x.
21. Fraser, Stuart, Sumon Kumar, Bhaumik, and Mike, Wright. 2015. “What Do We Know about Entrepreneurial Finance and Its Relationship with Growth?” International Small Business Journal 33 (1):70–88. doi:10.1177/0266242614547827.
22. Fried, Vance H., and Robert D., Hisrich. 1994. “Toward a Model of Venture Capital Investment Decision Making.” Financial Management 23 (3):28. doi:10.2307/3665619.
23. Gompers, Paul A., 1995. “Optimal Investment, Monitoring, and the Staging of Venture Capital.” The Journal of Finance 50 (5):1461–1489. doi:10.2307/2329323.
24. Hagedorn, Anja, and Andreas, Pinkwart. 2016. “The Financing Process of Equity-based Crowdfunding:An Empirical Analysis.” In Crowdfunding in Europe, edited by Dennis, Brüntje and Oliver, Gajda, 71–85. Cham:Springer Verlag International. http://link.springer.com/10.1007/978-3-319-18017-5_5.10.1007/978-3-319-18017-5
25. Hagiu, Andrei, and Simon, Rothman. 2016. “Network Effects Aren’t Enough.” Harvard Business Review 94 (4):64–71.
26. Haines, George H., Jr., Judith J., Madill, and Allan L., Riding. 2003. “Informal Investment in Canada:Financing Small Business Growth.” Journal of Small Business & Entrepreneurship 16 (3–4):13–40. doi:10.1080/08276331.2003.10593306.
27. Harrison, Richard. 2013. “Crowdfunding and the Revitalisation of the Early Stage Risk Capital Market:Catalyst or Chimera?” Venture Capital 15 (4):283–287. doi:10.1080/13691066.2013.852331.
28. Harrison, Richard, and Colin, Mason. 2002. “Backing the Horse or the Jockey? Agency Costs, Information and the Evaluation of Risk by Business Angels.” Frontiers of Entrepreneurship Research 26:393–403.
29. Heminway, J. M., 2013. “The New Intermediary on the Block:Funding Portals under the CROWDFUND Act.” UC Davis Business Law Journal 13:177.
30. Hornuf, Lars, and Armin, Schwienbacher. 2014a. “Crowdinvesting–Angel Investing for the Masses?” In Handbook of Research on Venture Capital. Vol. 3:Business Angels. http://papers.ssrn.com/sol3/Papers.cfm?abstract_id=2401515.
31. Hornuf, Lars, and Armin, Schwienbacher. 2014b. “Should Securities Regulation Promote Crowdinvesting?” SSRN Scholarly Paper ID 2412124. doi:10.2139/ssrn.2412124.
32. Hsu, Dan K., J., Haynie, Sharon A., Simmons, and Alexander, McKelvie. 2014. “What Matters, Matters Differently:A Conjoint Analysis of the Decision Policies of Angel and Venture Capital Investors.” Venture Capital 16 (1):1–25. doi:10.1080/13691066.2013.825527.
33. Jensen, Mark. 2002. “Securing Venture Capital:Today’s Realities.” Financial Executive 18 (6):43–46.
34. Kaplan, Steven N., and Per, Strömberg. 2003. “Financial Contracting Theory Meets the Real World:An Empirical Analysis of Venture Capital Contracts.” Review of Economic Studies 70 (2):281–315. doi:10.1111/1467-937X.00245.
35. Kelly, Peter, and Michael, Hay. 2000. “‘Deal-makers’:Reputation Attracts Quality.” Venture Capital 2 (3):183–202. doi:10.1080/13691060050135073.
36. Klöhn, Lars, and Lars, Hornuf. 2012. “Crowdinvesting in Deutschland–Markt, Rechtslage und Regulierungsperspektiven [Market, Legal Situation and Regulatory Perspectives].” Zeitschrift für Bankrecht und Bankwirtschaft 24 (4):237–266.
37. Klöhn, Lars, Tobias, Schilling, and Lars, Hornuf. 2015. “The Regulation of Crowdfunding in the German Small Investor Protection Act:Content, Consequences, Critique, Suggestions.” Diritto Della Banca e del Mercato Finanziario. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2595773.
38. Kollmann, Tobias, and Andreas, Kuckertz. 2010. “Evaluation Uncertainty of Venture Capitalists’ Investment Criteria.” Journal of Business Research 63 (7):741–747. doi:10.1016/j.jbusres.2009.06.004.
39. Kollmann, Tobias, Andreas, Kuckertz, and Nils, Middelberg. 2014. “Trust and Controllability in Venture Capital Fundraising.” Journal of Business Research 67 (11):2411–2418. doi:10.1016/j.jbusres.2014.02.008.
40. Ley, Andy, and Scott, Weaven. 2011. “Exploring Agency Dynamics of Crowdfunding in Start-up Capital Financing.” Academy of Entrepreneurship Journal 17 (1):85–110. http://www98.griffith.edu.au/dspace/handle/10072/42908.
41. Löher, Jonas, Sabrina, Schell, Stefan, Schneck, Arndt, Werner, and Petra, Moog. 2015. Unternehmensgründungen und Crowdinvesting [Entrepreneurship and Crowdinvesting]. IfM-Materialien, Institut für Mittelstandsforschung (IfM):Bonn. http://www.econstor.eu/handle/10419/122300.
42. Mason, Colin, and Matthew, Stark. 2004. “What Do Investors Look for in a Business Plan? A Comparison of the Investment Criteria of Bankers, Venture Capitalists and Business Angels.” International Small Business Journal 22 (3):227–248. doi:10.1177/0266242604042377.
43. Mitteness, Cheryl R., Melissa S., Baucus, and Richard, Sudek. 2012. “Horse vs. Jockey? How Stage of Funding Process and Industry Experience Affect the Evaluations of Angel Investors.” Venture Capital 14 (4):241–267. doi:10.1080/13691066.2012.689474.
44. Mollick, Ethan. 2014. “The Dynamics of Crowdfunding:An Exploratory Study.” Journal of Business Venturing 29 (1):1–16. doi:10.1016/j.jbusvent.2013.06.005.
45. Moritz, Alexandra, Joern, Block, and Eva, Lutz. 2015. “Investor Communication in Equity-based Crowdfunding:A Qualitative-empirical Study.” Qualitative Research in Financial Markets 7 (3):309–342. doi:10.1108/QRFM-07-2014-0021.
46. Patton, Michael. 1990. Qualitative Evaluation and Research Methods. Beverly Hills, CA:Sage.
47. Paul, Stuart, Geoff, Whittam, and Janette, Wyper. 2007. “Towards a Model of the Business Angel Investment Process.” Venture Capital 9 (2):107–125. doi:10.1080/13691060601185425.
48. Rasmussen, Einar, and Roger, Sørheim. 2012. “Obtaining Early-stage Financing for Technology Entrepreneurship:Reassessing the Demand-side Perspective.” Venture Capital 14 (2–3):77–89. doi:10.1080/13691066.2012.667908.
49. Reitan, Bjornar, and Roger, Sørheim. 2000. “The Informal Venture Capital Market in Norway? Investor Characteristics, Behaviour and Investment Preferences.” Venture Capital 2 (2):129–141. doi:10.1080/136910600295747.
50. Salomon, Victoriya. 2016. “Emergent Models of Financial Intermediation for Innovative Companies:From Venture Capital to Crowdinvesting Platforms in Switzerland.” Venture Capital 18 (1):21–41. doi:10.1080/13691066.2015.107995.
51. Schwienbacher, Armin. 2014. “Financing the Business.” In The Routledge Companion to Entrepreneurship, edited by Ted, Baker, 193–206. London:Routledge.
52. Siggelkow, Nicolaj. 2007. “Persuasion with Case Studies.” Academy of Management Journal 50 (1):20–24. doi:10.5465/AMJ.2007.24160882.
53. Teten, David, and Chris, Farmer. 2010. “Where Are the Deals? Private Equity and Venture Capital Funds’ Best Practices in Sourcing New Investments.” The Journal of Private Equity 14 (1):32–52. doi:10.3905/jpe.2010.14.1.032.
54. Tomczak, Alan, and Alexander, Brem. 2013. “A Conceptualized Investment Model of Crowdfunding.” Venture Capital 15 (4):335–359. doi:10.1080/13691066.2013.847614.
55. Tyebjee, T. Tyzoon, and Albert V., Bruno. 1984. “A Model of Venture Capitalist Investment Activity.” Management Science 30 (9):1051–1066. doi:10.1287/mnsc.30.9.1051.
56. Van Osnabrugge, Mark. 2000. “A Comparison of Business Angel and Venture Capitalist Investment Procedures:An Agency Theory-based Analysis.” Venture Capital 2 (2):91–109. doi:10.1080/136910600295729.
57. Viotto, Jordana. 2015. “Competition and Regulation of Crowdfunding Platforms:A Two-sided Market Approach.” Communications & Strategies 99 (3):33–50.
58. Vismara, Silvio. 2016. “Equity Retention and Social Network Theory in Equity Crowdfunding.” Small Business Economics 46 (4):579–590. doi:10.1007/s11187-016-9710-4.
59. Wong, Andrew, Mihir, Bhatia, and Zachary, Freeman. 2009. “Angel Finance:The Other Venture Capital.” Strategic Change 18 (7–8):221–230. doi:10.1002/jsc.849.
60. Yin, Robert. 1994. Case Study Research:Design and Methods. 2nd ed. Thousand Oaks, CA:Sage.