New technology assessment in entrepreneurial financing – Does crowdfunding predict venture capital investments?

Kaminski, Jermain; Hopp, Christian; Tykvová, Tereza (2019). New technology assessment in entrepreneurial financing – Does crowdfunding predict venture capital investments? Technological Forecasting and Social Change, 139, pp. 287-302. Elsevier 10.1016/j.techfore.2018.11.015

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Crowdfunding is a relatively new gateway for entrepreneurs to access capital for creative and innovative ideas. It allows individuals to start experiments with new products and technologies where the outcome is distant. Yet predicting the success of hitherto unseen products and technologies is fraught with ambiguity and uncertainty. Early stage product experimentation and market access through reward-based crowdfunding, where potential customers provide funds for new unproven products, can therefore provide quality signals to subsequent financiers of new technologies. Our study investigates whether there is a long-run relationship between crowdfunding and VC investments on the aggregate and the industry level. We draw on a dataset covering 77,654 projects that successfully raised funds on Kickstarter and 3260 VC investments in the US between 2012 and 2017. The results suggest that crowdfunding Granger causes VC investments. Moreover, the monthly crowdfunding and VC investment time series are cointegrated. We therefore conclude that successful crowdfunding campaigns lead to a subsequent increase in VC investments. This holds at the aggregate level and particularly for hardware and consumer electronics, as well as fashion. These results enhance our understanding of the co-development between crowdfunding and VC investments. Reward-based crowdfunding helps VC investors in assessing future trends rather than crowding them out of the market.

Item Type:

Journal Article (Original Article)


Business School > Business Foundations and Methods


Kaminski, Jermain;
Hopp, Christian0000-0002-4095-092X and
Tykvová, Tereza








Christian Hopp

Date Deposited:

16 Sep 2020 12:38

Last Modified:

06 Oct 2021 02:18

Publisher DOI:


Uncontrolled Keywords:

Technology prediction Granger causality Reward-based crowdfunding Venture capital




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