Abstract
Equity Crowdfunding Online Portals offer access to investors, resources and fundraising support to numerous equity crowdfunding projects from different industry sectors. In this context, we study investors’ preferences of equity crowdfunding projects in different industries. We present novel empirical evidence revealing differences in startup characteristics across various industry sectors and examine how certain startup characteristics influence business valuations for representative industries in equity crowdfunding. A new business valuation method in equity crowdfunding is introduced to facilitate our analyses.
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Notes
In a pooling equilibrium, investors have universal preferences for equity crowdfunding start-ups from the same industry sector.
In a separating equilibrium, investors rely on different signals to differentiate start-up quality based on their industry classification.
Industry classification is based on the first two digits of North American Industry Classification System (NAICS) code.
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Johan, S., Zhang, Y. Investors’ industry preference in equity crowdfunding. J Technol Transf 47, 1737–1765 (2022). https://doi.org/10.1007/s10961-021-09897-8
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DOI: https://doi.org/10.1007/s10961-021-09897-8