Does success bring success? The post-offering lives of equity-crowdfunded firms
By Andrea Signori, Silvio Vismara. Journal of Corporate Finance, 2017
256 citations recorded by the source corpus.
Using an augmented dataset with combined information from Crowdcube, Crunchbase, and Companies House, we study the population of 212 successfully funded initial equity offerings on the UK's largest crowdfunding platform Crowdcube from inception (2011) to 2015. We find that 18% of these firms failed, while 35% pursued one or more seasoned equity offerings in the form of either private equity injection (9%) or follow-on crowdfunding offering (25%), while three firms were acquired. Among the determinants of the post-campaign scenarios, we find that the degree of investor participation in the initial offering plays a relevant role. In particular, firms with more dispersed ownership are less likely to issue further equity, while those that reach the target capital more quickly are more likely to launch a follow-on offering. Further, none of the companies initially backed by qualified investors subsequently failed.
Subfields: Accounting, Economics and Econometrics, Management Information Systems
View Paper: https://www.semanticscholar.org/paper/5c7a3610f6c7c626d560f0bf1e485655e11a8d6e
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In Accounting
- Xavier Walthoff‐Borm
- F. Polzin
- Tom Vanacker
- E. Stam
- Armin Schwienbacher
- Wanxiang Cai
- Douglas J. Cumming
- Ross Brown
In Economics and Econometrics
- F. Polzin
- E. Stam
- Tom Vanacker
- Wanxiang Cai
- Xavier Walthoff‐Borm
- Armin Schwienbacher
- E. Malecki
- Douglas J. Cumming
In Management Information Systems
Citations in the corpus
- Equity crowdfunding: First resort or last resort? (2017, methodology): “…in the UK, the largest and most developed crowdfunding market in Europe, to collect a sufficient number of firms that applied (successfully or not) for equity crowdfunding (e.g., Harrison, 2013; Ralcheva and Roosenboom, 2016; Signori and Vismara, 2018; Vismara, 2016, 2018; Vulkan et al., 2016).”
- Determinants of individual investment decisions in investment-based crowdfunding (2018, unknown): “One exception that offers such ex post performance analysis is Signori and Vismara’s (2018) work.”
- Crowdfunding and social capital: A systematic review using a dynamic perspective (2021, background): “Several studies investigate how projects ’ performance in equity crowdfunding affects their probability of receiving follow-up W. Cai et al. investments (Cumming et al., 2019; Signori and Vismara, 2018); however, they ignore the role of social capital.”
- Equity Crowdfunding and Governance: Toward an Integrative Model and Research Agenda (2019, unknown): “Currently, the shares of ECF firms are illiquid and difficult to trade (Signori and Vismara, 2018).”