Abstract

There has been much excitement for the potential of equity crowdfunding from entrepreneurs, legislators, and other interested parties. Despite this, emerging research has yet to provide clear guidance regarding how the crowd in this unique setting might influence non-professional investment decisions. In this study, we develop a framework that seeks to explore the underlying individual-level factors that influence equity crowdfunders to respond differently to crowd influences. In developing our hypotheses we build upon studies of conformity (Asch, 1956) and the social cognitive perspective to explore how the influence of the crowd varies among different “types” of individuals in a crowd investment context.

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