Herding Or Bystanding? Dynamic Analysis Of The Effect Of Reward-based Crowdfunding Pre-investment

The development of Internet technology has continuously promoted the renewal of business models in various industries.The traditional financial model is gradually being replaced by a new business model under the background of the Internet.Crowdfunding has also emerged as a new financing model.The establishment of a better channel for capital flow between fund demanders and fund providers has stimulated the private financial market.Therefore,after more than ten years of development,crowdfunding has be grown rapid speed in business worldwide because of a low threshold,high diversity and convenience that distinguish it from traditional financing.Nearly 2,000 crowdfunding platforms around the world provide project crowdfunding services.However,there are still many problems in the process of crowdfunding development.For example,the problem of the herding behavior of investors in the crowdfunding platform,a large amount of funds concentrated in a few projects has led to the failure of many high-quality project financing.Therefore,research on investor behavior in crowdfunding is particularly important for crowdfunding platforms and crowdfunding fundraisers.In this paper,reward-based crowdfunding is the basic research object.Based on the characteristics of rewarded crowdfunding and other crowdfunding,the investment behavior of crowdfunding investors in the Internet reward-based crowdfunding platform is affected by herd effect and responsibility diffusion.The effects of the two opposite directions are empirically tested in the process of changes in investment periods under the different reward-type crowdfunding models of KIA and AON.This paper collects the world's first and the largest KIA and AON model parallel crowdfunding website Indiegogo for empirical research,through the crawler technology selected the site from November 2015 to May 2018,6245 data,retain the funding cycle For the 60-day sample,draw on Kuppuswamy(2016)and Burtch(2018)for the financing cycle,test the impact of the previous investor's investment on subsequent investor decisions,and determine the follow-up investor's investment decisions.The changes in the investment period are affected by the changes,as well as the adjustment of the target amount and the deadline.In this paper,the panel model is tested by the Poisson model.The empirical results show that:(1)Under the reward-based AON crowdfunding model,the new supporters obtained in the early stage of the project are negatively correlated with the past supporters.The new supporters obtained are negatively correlated with past supporters,and the responsibility diffusion effect will always dominate.In the reward-based KIA crowdfunding model,the new supporters obtained in the early stages of the project are positively related to past supporters.New supporters in the middle and late stages of the project were negatively correlated with past proponents.In the early stage,the influence of the herd effect will occupy a dominant position,and the influence of the responsibility diffusion effect will occupy a dominant position in the middle and late stages of the project.(2)Under the reward-based AON crowdfunding model,the influence of past investors on potential investors is actively adjusted by the target amount,and the influence of past supporters on potential supporters is positively adjusted by the deadline.The impact of the target amount and potential supporters will diminish the negative impact of the spread of responsibility on the behavior of potential supporters.(3)In the reward-based KIA model,the influence of past supporters of the project on potential investors is negatively adjusted by the target amount,and the influence of past supporters of the project on potential supporters is positively adjusted by the deadlineThe research results of this paper not only make up for the research gap of the current analysis of the behavior pattern of the crowdfunding people in KIA mode.The research results of this paper also provide corresponding reference for the crowdfunding platform that provides both KIA mode and AON mode and crowdfunding fundraiser.Investigating the behavior of investors in crowdfunding is crucial for crowdfunding websites to motivate users to actively invest or crowdfunding fundraisers to carry out fundraising activities.This paper uses empirical research to promote the investment behavior of potential investors.Suggestions to provide a reference for the broad masses of platforms and entrepreneurs who want to get venture capital through crowdfunding.