KEY SUCCESS FACTORS FOR CROWDFUNDING OPERATIONS OF ENTREPRENEURIAL PROJECT HOLDERS
DOI:
https://doi.org/10.47941/jepm.903Keywords:
Crowd-funding, success, campaign, entrepreneur, CameroonAbstract
Mainly motivated by the need to improve the success rate of fundraising campaigns on crowdfunding platforms, this article aims to identify the key success factors of crowdfunding operations initiated by Cameroonian entrepreneurs. Within this framework, an empirical study was carried out on 50 project leaders operating in various sectors of activity and having conducted funding campaigns between 2017 and 2020. This sample, selected using the reasoned choice method combined with the snowball technique, was analysed using appropriate statistical tests. In this context, the first step was to test the relationship of dependence or independence between the success of a campaign and its socio-demographic characteristics through a descriptive analysis. Based on this step, the variables deemed significant were included in a proven model via binary logistic regression, which made it possible to highlight characteristics specific to projects and entrepreneurs whose fundraising campaigns were successful. Following this approach, the results obtained show that the level of education, the length of professional experience, the size of the share capital and the contribution of professional investors are positively and significantly associated with the success of a crowdfunding operation in Cameroon. These results reinforce the theory in the sense that they teach us that certain indicators related to the project holders as well as the project itself can constitute positive signals for the target audience. Therefore, these entrepreneurs need to optimise on these characteristics in order to maximise the probability of success of their fundraising campaigns.
Downloads
References
Abor, J., & Quartey, P. (2010). Issues in SME development in Ghana and South Africa. International research journal of finance and economics, 39(6), 215-228.
Agrawal, A., Catalini, C. et Goldfarb, A. (2010). The Geography of Crowdfunding. NET Institute Working Paper, 10-08, 56.
Ahlers, G. K. C., Cumming, D., Gunther, C., & Schweizer, D. (2015). Signaling in equity crowdfunding. Entrepreneurship Theory and Practice, 39(4), 955-980. https://doi.org/10.1111/etap.12157
Barbi, M., & Mattioli, S. (2019). Human capital , investor trust , and equity crowdfunding. Research in International Business and Finance. https://doi.org/10.1016/j.ribaf.2019.02.005
Baum, J. A. C., & Silverman, B. S. (2004). selection criteria in venture financing and performance of biotechnology Picking winners or building them ? Alliance , intellectual , and human capital as selection criteria in venture financing and performance of biotechnology startups. Journal of Business Venturing, 19, 411-436. https://doi.org/10.1016/S0883-9026(03)00038-7
Belleflamme, P., & Lambert, T. (2012). Crowdfunding : Tapping the Right Crowd. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.1578175
Berger, A.N. et Udell, G.F. (1998), The economies of small business finance: The rôles of private equity and debt markets in the Financial growth cycle. Journal of Banking & Finance 22, 613-673. doi: 10.1016/80378-4266(98)00038-7.
Bidart, C. (2008). Dynamiques des rseaux personnels et processus de socialisation: volutions et influences des entourages lors des transitions vers la vie adulte. Revue française de sociologie, 49(3), 559-583.
Block, J.H., DeVries,G.,Schumann,J.H.,& Sandner, P. (2014). Trademarks and venture capital valuation. Journal of Business Venturing, 29(4), 525-542. doi:10.1016/j. jbusvent.2013.07.006.
Block, J., Hornuf, L., & Moritz, A. (2018). Which updates during an equity crowdfunding campaign increase crowd participation ? Small Business Economics, 50(1), 3-27. https://doi.org/10.1007/s11187-017-9876-4
Böckel, A., Hörisch, J., & Tenner, I. (2020). A systematic literature review of crowdfunding and sustainability: highlighting what really matters. Management Review Quaterly, 21. https://doi.org/10.1007/s11301-020-00189-3
Bouaiss, K., & Redis, J. (2019). "¦ Et pour quelques euros de plus : Une contribution a la connaissance des pratiques d ' equity crowdfunding. Finance Controle Stratgie. https://doi.org/10.4000/fcs.3023
Bourdieu, P. (1980). L'identit et la reprsentation. Actes de la recherche en sciences sociales, 35(1), 63-72.
Cazalas, F., (2011), atlantico.fr/decryptage/industrie-financement-jeunes-societes-innovantes-equity-gap-business-angels-72875.html.
Clauss, T., Niemand, T., & Kraus, S. (2020). INCREASING CROWDFUNDING SUCCESS THROUGH SOCIAL MEDIA : THE IMPORTANCE OF REACH AND UTILISATION IN REWARD-BASED CROWDFUNDING. International Journal of Innovation Management, 24(03), 1-30. https://doi.org/10.1142/S1363919620500267
Cohen, B. (2006). Sustainable valley entrepreneurial ecosystems. Business Strategy & the Environment (John Wiley & Sons, Inc), 15(1), 1-14.
Coleman, J. S. (1988). Social capital in the creation of human capital. American journal of sociology, 94, S95-S120.
Coleman, J. S. (1990). Commentary: Social institutions and social theory. American sociological review, 55(3), 333-339.
Colombo, M., Franzoni, C., & Rossi-lamastra, C. (2015). Internal social capital and the attraction of early contributions in crowdfunding. Entrepreneurship Theory and Practice, 39(1), 75-100.
Connelly, B. L., Certo, S. T., Ireland, R. D., & Reutzel, C. R. (2011). Signaling Theory: A Review and Assessment. Journal of Management, 37(1), 39-67. https://doi.org/10.1177/0149206310388419
Corbel, P., Sandra Charreire-Petit, & Dubocage, E. (2018). Crowdfunding : les trajectoires du succès "¦ ou de l'chec. Innovations, 2(56), 239-266. https://doi.org/10.3917/inno.pr1.0037
Courtney, C., Dutta, S., & Li, Y. (2017). Resolving Information Asymmetry : Signaling , Endorsement , and Crowdfunding Success. Entrepreneurship Theory and Practice, 41(2), 265-290. https://doi.org/10.1111/etap.12267
Eniola, A. A., & Entebang, H. (2015). SME firm performance-financial innovation and challenges. Procedia-Social and Behavioral Sciences, 195, 334-342.
ESF. (2009). Le secteur priv en Afrique, lment essentiel de la croissance conomique.
Flore, K. K. C., & Omenguele, G. R. (2019). L'effet synergique des dterminants de l'accès au financement bancaire par les PME au Cameroun. Journal of Academic Finance, 10(2), 84-101.
Goudreault, S., et Hbert, M. (2013). Pour dveloppement conomique misant sur les PME Avis de la FCEI concernant le Projet de loi no° 36 : Loi sur la Banque de dveloppement conomique du Qubec
Institut National de la Statistique (INS). Deuxième Recensement Gnral des Entreprises (RGE-2) ; Document de Mthodologie Gnrale, 2016.
Isenberg, D. (2011). Introducing the Entrepreneurship Ecosystem: Four Defining Characteristics. Forbes, May, 25 retrieved from, https://www.forbes.com/sites/danisenberg/2011/05/25/introducing-the-entrepreneurship-ecosystem-four-defining-characteristics/?sh=40fffbf05fe8? consult le 14/03/2022
Kenfack, M. K. (2016). L'obtention du crdit bancaire par les PME au Cameroun. Afrique et Dveloppement, 15(1), 121-158.
Kim, K., & Viswanathan, S. (2013). The experts in the crowd: The role of reputable investors in a crowdfunding market. SSRN Working Paper No. 2258243.
Kouame, D. S. (2012). Le financement, levier de performance des Jeunes Entreprises Innovantes. Entreprendre Innover, (4), 7-17.
Lukkarinen, A., Teich, J. E., Wallenius, H., & Wallenius, J. (2016). Success drivers of online equity crowdfunding campaigns. Decision Support Systems. https://doi.org/10.1016/j.dss.2016.04.006
Mazzarol, T. (2014). Growing and sustaining entrepreneurial ecosystems: What they are and the role of government policy. White Paper WP01-2014, Small Enterprise Association of Australia and New Zealand (SEAANZ), www.seaanz.org
Mollick, E. (2014). The dynamics of crowdfunding: An exploratory study. Journal of Business Venturing, 29(1), 1-16. https://doi.org/10.1016/j.jbusvent.2013.06.005
NYAGA, Y. P. E. (2020). Accès au financement et performance des PME au Cameroun. Repères et Perspectives Economiques, 4(1).
OIF. (2015), «Financement participatif, un outil de financement pour les jeunes francophones », Communication au 2ème Forum Mondial de la Langue Français, Liège, Belgique, 20 juillet 2015, http://www.slideshare.net/cvrvkv/prsentation-sur-financement- participatif-liege-20-iuillet-2015
OCDE (2018). Amliorer l'accès des PME à des instruments de financements diversifis, Confrence Ministrielle sur les PME, Session plnière 2, Papier de discussion, 32 Pages.
Perkins, S.J.,& Hendry, C.(2005). Ordering top pay: interpreting the signals. Journal of Management Studies, 42(7), 1443- 1468. doi:10.1111/j.1467-6486.2005.00550.x.
Pinkow, F., & Emmerich, P. (2021). Re-Examining Crowdfunding Success : How the Crowdfunding Goal Moderates the Relationship of Success Factors and Crowdfunding Performance. Central European Business Review, 10(20), 24. https://doi.org/10.18267/j.cebr.263
Piva, E., & Rossi-lamastra, C. (2017). Human capital signals and entrepreneurs ' success in equity crowdfunding. Small Business Economics, 51(3), 667-686.
Putnam, R. D. 1995. Bowling alone: America's declining social capital. The Journal of Democracy 6(1): 65-78.
Ralcheva, A., & Roosenboom, P. (2019). Forecasting success in equity crowdfunding. Small Business Economics, 55(1), 39-56. https://doi.org/10.1007/s11187-019-00144-x
Ross, S. A. (1977). The determination of financial structure: the incentive-signalling approach. The bell journal of economics, 23-40.
Saxton, G., & Wang, L. (2014). The social network effect: the determinants of giving through social media. Nomprofit and Voluntary Sector Quaterly, 43(5), 850-868.
Shneor, R., & Vik, A. A. (2020). Crowdfunding success: a systematic literature review 2010-2017. Baltic Journal of Management, 15(2), 149-182.
St-Pierre, J., Foleu, L., Abdul-Nour, G., & Nomo, S. (2015, April). Les freins au dveloppement des PME camerounaises: qu'en pensent les entrepreneurs?. In 6 th Africa Business and Entrepreneurship Conference.
Tadesse, A. (2009). Quelles perspectives de financement pour les PME en Afrique?. La revue de PROPARCO, 1, 17-19.
Tarteret, O. (2014). La dynamique du crowdfunding: revue critique de la littrature et facteurs du succès d'une collecte.
Vismara, S. (2016). Equity retention and social network theory in equity crowdfunding. Small Business Economics, 46(4), 579-590. https://doi.org/10.1007/s11187-016-9710-4
Vismara, S. (2018). Information Cascades among investors in Equity Crowdfunding. Entrepreneurship Theory and Practice, 42(3), 467-497. https://doi.org/10.5465/AMBPP.2015.11519abstract
World Bank. (2014). Doing Business 2014: Understanding Regulations for Small and MediumSize Enterprises. Washington, DC: World Bank Group
World Economic Forum. (2013). Entrepreneurial ecosystems around the globe and company growth dynamics, report summary for the annual meeting of the new champions 2013.
Zacharakis, A., & Meyer, G. D. (2000). The Potential of Actuarial Decision Models : Can They Improve the Venture Capital Investment Decision ? Journal of Business Venturing, 15(4), 323-346.
Downloads
Published
How to Cite
Issue
Section
License
Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution (CC-BY) 4.0 License that allows others to share the work with an acknowledgment of the work's authorship and initial publication in this journal.
