COVID-19 and Entrepreneurial Processes in U.S. Equity Crowdfunding

Center for Financial Studes Working Paper No. 665, 2021

40 Pages Posted: 29 Nov 2021

See all articles by Douglas J. Cumming

Douglas J. Cumming

Florida Atlantic University

Robert Reardon

Florida Atlantic University

Multiple version iconThere are 2 versions of this paper

Date Written: October 11, 2021

Abstract

COVID-19 brought about a shift in entrepreneurial opportunities and in the United States. In this paper, we proxy entrepreneurial processes by examining housing prices in different regions of the United States. Housing prices capture the movement in people, tax dynamics, and behavioral preferences for equity ownership in different regions and over time, all of which were drastically impacted by COVID-19. We examine all U.S. equity crowdfunding offerings starting with the very first offerings in 2016 Q2 until 2021 Q1 based on data from the Securities and Exchange Commission. The data indicate that regional housing prices post-COVID-19 are a strong predictor of the number of equity crowdfunding campaigns and the amount of capital raised. The impact of housing price changes on crowdfunding is more pronounced among more prosperous regions. The housing price effect is robust to numerous controls and consideration of outliers.

Keywords: Equity Crowdfunding, COVID-19, Regional Entrepreneurship

JEL Classification: G21, G28, G51

Suggested Citation

Cumming, Douglas J. and Reardon, Robert S., COVID-19 and Entrepreneurial Processes in U.S. Equity Crowdfunding (October 11, 2021). Center for Financial Studes Working Paper No. 665, 2021, Available at SSRN: https://ssrn.com/abstract=3973119 or http://dx.doi.org/10.2139/ssrn.3973119

Douglas J. Cumming (Contact Author)

Florida Atlantic University ( email )

777 Glades Rd
Boca Raton, FL 33431
United States

HOME PAGE: http://sites.google.com/view/douglascumming/bio?authuser=0

Robert S. Reardon

Florida Atlantic University ( email )

777 Glades Rd
Boca Raton, FL 33431
United States

HOME PAGE: http://sites.google.com/view/robertsreardon

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
25
Abstract Views
152
PlumX Metrics