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Abstract
Crowdfunding platforms are becoming more and more popular for fund-raising of entrepreneurial ventures, but the success rate of crowdfunding campaigns is found to be less than 50%. Recent research has shown that, in addition to the quality and representations of project ideas, dynamics of investment during a crowdfunding campaign also play an important role in determining its success. To further understand the role of investment dynamics, we did an exploratory analysis of the time series of money pledges to campaigns inKickstarter to investigate the extent to which simple inflows and first-order derivatives can predict the eventual success of campaigns. Using decision tree models, we found that there were discrete stages in money pledges that predicted the success of crowdfunding campaigns. Specifically, we found that, for the majority of projects that had the default campaign duration of one month in Kickstarter, money pledges inflow occurring in the initial 10% and 40-60%, and the first order derivative of inflow at 95-100% of the duration of the campaigns had the strongest impact on the success of campaigns. In addition, merely utilizing the initial 15% money inflows, which could be regarded as “seed money”, to build a predictor can correctly predict 84% of the success of campaigns. Implication of current results to crowdfunding campaigns is also discussed.
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Authors and Affiliations
Dept. of Computer Sci & Tech, University of Sci & Tech, China
Huaming Rao
Dept. of Computer Science, University of Illinois at Urbana-Champaign, USA
Huaming Rao, Anbang Xu & Wai-Tat Fu
Dept. of Automation, Tsinghua University, China
Xiao Yang
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- Wai-Tat Fu
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Center for Social Complexity and Department of Computational Social Science, George Mason University, 4400 University Drive, MS 6B2, 22030-4400, Fairfax, VA, USA
William G. Kennedy
University of Arkansas at Little Rock, 2801 South University Avenue, EIT Building, Room 553, 72204, Little Rock, AR, USA
Nitin Agarwal
Department of Computer Engineering, Rochester Institute of Technology, 83 Lomb Memorial Drive, Bldg 09, 14623-5603, Rochester, NY, USA
Shanchieh Jay Yang
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Rao, H., Xu, A., Yang, X., Fu, WT. (2014). Emerging Dynamics in Crowdfunding Campaigns. In: Kennedy, W.G., Agarwal, N., Yang, S.J. (eds) Social Computing, Behavioral-Cultural Modeling and Prediction. SBP 2014. Lecture Notes in Computer Science, vol 8393. Springer, Cham. https://doi.org/10.1007/978-3-319-05579-4_41
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