Signals' Flexibility and Interaction with Visual Cues: Insights from CrowdfundingApril 15, 2021 - Blakley Davis
Citation: Scheaf, D. J., Davis, B. C., Webb, J. W., Coombs, J. E., E, G., M, J. (in press). Signals' Flexibility and Interaction with Visual Cues: Insights from Crowdfunding. (vol. 33, pp.720-741). Journal of Business Venturing. FT50 IF 6.663 AIS 2.803
Is it the information in a pitch, the quality of the pitch, or some combination of both that maximizes entrepreneur funding? We study this question by examining the influence of both costly informative signals, such as patent ownership and media coverage, and visual cues of pitch quality, such as the pitch’s text and video quality on equity crowdfunding success. We find context sensitive interrelationships such that signals and visual cues interact to increase funding beyond what either would support individually. In the case of informative signals, the extent to which a specific signal type is effective depends upon characteristics of both the signal source and the signal receiver. We also find that visual cues interact with the pitch’s informative content to influence effectiveness. Collectively, these findings suggest that entrepreneurs should consider not only the quality of the information they communicate through their funding pitch, but also context and the quality of the pitch itself.