Are the Life and Death of an Early Stage Venture Indeed in the Power of the Tongue ? Lessons from Online Crowdfunding Pitches

Abstract

While presenting an initiative to potential backers, the entrepreneur can choose the extent to which she presents herself, versus presenting the idea. We investigate this decision and its effect on the success of the fundraising on a leading crowdfunding platform (Kickstarter). We employ a text mining quantification method validated by experiments and robustness tests. Our dataset was collected using custom software and includes over 20,000 online business pitches and their results. We find that in Kickstarter fundraising, entrepreneurs' descriptions matter - projects (especially art related) that frequently mentioned the entrepreneurs’ name enjoyed higher rates of success, controlling for relevant variables.

Keywords: crowdfunding, Kickstarter, fundraising