Success Factors in Reward based and Equity based Crowdfunding in Finland

Master’s Thesis 
27 
Some success factors are associated with the network of potential funders available to 
a project. The number of social media connections the entrepreneurs have and the 
number of web users that have seen their pitches both affect how successful the 
crowdfunding initiative is (
Giudici et al., 2013)
. Funder satisfaction is also a big im-
pact on success, because it leads to positive word of mouth (Buttle, 1998). Funder 
satisfaction can be achieved with funder participation and good project implementa-
tion, for example timeliness of rewards and project quality (Xu et al., 2015). 
As mentioned earlier, funder motivations are highly heterogenic. Thus, there is no 
simple solution to succeeding in crowdfunding. Different ventures attract different 
funders, so it is important to understand what a particular project has to offer and how 
to best market that to potential funders. According to Wheat et al. (2013), it is a myth 
that only charismatic projects are funded in the field of scientific research crowdfund-
ing. The topic of the research is often less important than the crowd it engages con-
cerning whether or not it succeeds. 
5.1. Project Type and Rewards 
The composition of the project itself can affect how well a crowdfunding initiative 
does. This refers to the field or subject that the project represents. Additionally, the 
crowdfunding model and rewards attributed to the initiative play a role in its success. 
A project that is attention grabbing is more likely to raise funding. This pertains espe-
cially to non-profit ventures that often attract funding due to their nature. Online fun-
ders are prone to contribute to certain types of causes more easily. Health related 
causes are most favored. (Saxton and Wang, 2013) Non-profit organizations are also 
significantly more likely to raise their target amount of capital and larger amounts 
compared to for-profit entrepreneurs, in cases of independently facilitated crowdfund-
ing. (Belleflamme et al., 2013) 
Crowdfunding model and rewards also affect success. The choice of crowdfunding 
model appears to have an impact on success rate, but not the amounts raised (Belle-
flamme et al., 2013). Within the reward-based model, initiatives with a product rather 
than a service as a reward tend to attract larger amounts of funding. This is because 
funders seem to be more prone to provide funding if they expect a tangible outcome. 

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