Crowdfunding for environmental ventures: an empirical analysis of the influence of environmental orientation on the success of crowdfunding initiatives
Graphical abstract
Crowdfunding success by project category.
Section snippets
Introduction: the relevance of crowdfunding for environmental ventures
Research from various disciplines emphasises that mankind is exceeding critical thresholds of environmental pollution with regard to climate change, biodiversity loss and other dimensions of environmental sustainability (Rockström et al., 2009, Steffen et al., 2015). Since the 1960s, a growing societal concern for these problems of environmental unsustainability can be observed (cf. Carson, 1962; Du Plessis and Brandon, 2014). As environmental problems become more and more pressing, businesses
Literature review: theoretical foundations and research objective
Crowdfunding was first used for rather small-scale projects in the music and movie industry (Lambert and Schwienbacher, 2010). As time passed and popularity grew, ventures in other domains (e.g. conventional businesses, gaming, culture) started to make use of crowdfunding as well, and thus the scope of crowd-funded projects has increased. ‘Trampoline Systems’ is sometimes reported to be the first project which raised more than one million US-Dollars by crowdfunding (Lambert and Schwienbacher,
Material and methods
This paper builds on existing conceptual and early empirical work by exploring the relationship between environmental orientation of crowdfunding projects and their likelihood of success. As crowdfunding can be considered an emergent topic in the evolving field of sustainable entrepreneurship, such an exploratory approach seems most promising in order to develop initial empirical insights on the relationship between environmental orientation and crowdfunding, and to identify and structure
Results
As a first step of analysis, the different categories of crowdfunding projects were compared descriptively with regard to funding success. Fig. 1 highlights that environmentally oriented projects achieve the lowest values for both indicators of success: Whereas on average 34.0% of all crowdfunding projects included in the dataset achieved their funding targets, only 10.0% of the environmentally oriented projects were found to be successful. Similarly, environmentally oriented projects on
Discussion
Concerning non-profit orientation, this study reinforces the findings by Belleflamme et al. (2013) as well as by Pitschner and Pitschner-Finn (2014) that non-profit projects tend to be more successful in funding. The results on non-profit orientation also confirm conceptual propositions derived from contract failure theory (Belleflamme et al., 2013, Lehner, 2013). Furthermore, in line with intuition and an earlier analysis by Mollick (2014), the analysis finds that projects with higher funding
Conclusions and implications
In contradistinction to the expectations formulated in the early conceptual literature, this research found that environmental orientation of crowdfunding projects currently cannot be observed to be positively related to the success of crowdfunding projects. However, conceptual works (e.g. Bartenberger and Leitner, 2013, Lehner, 2013) consistently elaborated that potential for crowdfunding in the context of sustainable entrepreneurship exists. Furthermore, examples of successful environmentally
Acknowledgements
I would like to thank Stefan Schaltegger and Roger Burritt for providing valuable comments on earlier versions of this paper. Furthermore, I am grateful to the anonymous reviewers for their very valuable comments which helped me to improve the paper as well as to Matthew Johnson and Daria Wetter, for proof-reading the article.
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