Start-ups with female founders typically raise less money than their male counterparts. Prior literature explores investor demand and finds evidence of assortative matching, where investors prefer to invest in entrepreneurs of their own gender. In the context of equity crowdfunding, we examine the supply side of the gender funding gap, asking how female and male founders anticipate different investor demand. We develop an assortative matching theory that generates four benchmark predictions, namely that female founders (i) ask for less funding, (ii) have the same campaign success probability, (iii) receive less funding if successful, and (iv) have the same overfunding ratio, defined as the ratio of funding received over funding requested. Leveraging proprietary data from a UK equity crowdfunding platform that includes both successful and unsuccessful ventures, the evidence matches the first three predictions, also finding that all-female teams have larger funding gaps than mixed-gender teams. For the overfunding ratio, we find that mixedgender (all-female) teams have higher (lower) overfunding ratios than the all-male benchmark. We also find that female investors fund mixed-gender teams relatively more, whereas male investors give disproportionately less to all-female teams. Gender gaps increase for more capital-intensive ventures.

We build a model of equity crowdfunding that incorporates the two major funding models: all-or-nothing (AoN) and keep-it-all (KIA). Both informed and uninformed investors arrive sequentially and rationally choose whether and how much to invest. The KIA solution turns out to be a reduced version of AoN without signalling. We test predictions using data from a leading European equity crowdfunding platform and find support. Results are consistent with rational information aggregation. However, negative information cascades may still appear. The AoN crowdfunding mechanism might therefore fail to finance a nonnegligible percentage of positive NPV projects.

Using UK data on regulatory FinTech Sandboxes, we examine both their direct effect on participant companies, and their indirect effects on the broader ecosystem. We show that previously documented direct fundraising effects are not robust to heterogeneous treatment estimation methodologies like Callaway and Sant'Anna (2021). Instead of direct fundraising effects, we find that Sandbox participation has indirect effects on the FinTech ecosystem. Specifically, we find positive fundraising effects for UK startups outside the Sandbox in industries affected by entry into the regulatory Sandbox.

It is well known that start-ups with female founders often raise less money than their male counterparts; the question is, what drives this? We exploit the unique features of equity crowdfunding to disentangle the choices made by entrepreneurs and investors. We find that female teams set lower fundraising goals, are equally likely to achieve their minimum goal, and end up raising significantly less. Guided by a simple theory of optimal fundraising, we find that assortative matching (where investors prefer to invest in their own gender) can explain some but not all of the female funding gap. One interesting finding is that female start-ups wait longer before closing their campaigns, suggesting that they want to raise more than what they originally asked for. Overall, the analysis suggests that female founders ask for less, get less, but do not necessarily want less.

Equity crowdfunding platforms are at the center of the digital transformation of early-stage venture funding. These digital platforms were originally heralded as a democratizing force in early stage finance, due to their role in facilitating the exchange between entrepreneurs and a multitude of non-professional small investors ("the crowd"). Equity crowdfunding platforms have experienced considerable growth and now attract professional investors including business angels. The presence of angels alongside the crowd on equity crowdfunding platforms has raised questions whether these digital platforms can continue to play their role in democratizing access to capital. Using data from a leading equity crowdfunding platform, we examine the interplay between the investment decisions of angels and the crowd. We find evidence of information flows in crowdfunding platforms between angels, and from angels to the crowd. We find angels play an important role in funding of large ventures, whereas the crowd not only fill the funding gaps for such large ventures but also play a pivotal role in the funding of small ones. The complementarity between angels and crowd investors seems to increase the overall efficiency in an otherwise highly asymmetric and uncertain market, confirming that digitization can indeed bring important benefits to venture investment.

We use equity crowdfunding data to ask how fundraising amounts can be explained by what entrepreneurs ask for, versus what investors want to invest. The analysis exploits unique features of crowdfunding where entrepreneurs not only set investment goals, but also chose when to close their campaigns. More experienced and more educated founder teams ask for more. Their campaigns succeed more often, and they raise more money. Female teams ask for less, are equally successful, yet raise significantly less. They also wait longer before closing campaigns, suggesting they want to raise more than what they originally asked for.

Through this study, we aim to reconcile differences in observed pricing behavior across industries by theoretically and empirically analysing the effect of market share on pricing strategies. Based on our proposed model of static competition, in equilibrium, symmetric competitors will offer discounts to new customers, while asymmetric competition provides sufficient conditions for small firms to offer loyalty rewards. We find that aggressiveness in pricing (difference in price to new and existing customers) decreases when markets become more competitive and market dominance (large inherited market share) is positively correlated with aggressive customer poaching. We further test our predictions by conducting a controlled experiment. In line with our predictions, we find that the price setting behavior of experimental participants varies with market share and that having a smaller inherited customer base results in loyalty rewards. Our work contributes to the behvaior based price discrimination literature by showing that a low inherited market share provides a sufficient condition for discounts to existing customers. The managerial implications of these findings are also discussed.

We provide evidence that a personality trait, aggression, has a first-order effect on group financial decision making. In a laboratory experiment on group portfolio choice, highly aggressive subjects (measured by a standard psychology test) were much more likely to recommend risky investment strategies consistent with their own personal information, regardless of the information received by other group members. Outside of this group context, aggression had no effect on subject behavior. Thus, our aggression measure appears to capture an aggressive disposition, which seeks to dominate group decisions, rather than simply reflect risk attitudes or cognitive biases.

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Crowdfunding has recently become available for entrepreneurs. Most academic studies analyse data from rewards-based (pre-selling) campaigns. In contrast, in this paper we analyse 636 campaigns, encompassing 17,188 investors and 64,831 investments between 2012 and 2015, from one of the leading European equity crowdfunding platforms. We provide descriptive statistics and carry out cross-campaign regression analysis. The descriptive statistics address its size, growth and geographic distributions in the UK. The regressions analyse which factors are associated with the probability of a successful campaign. We find some similarities and some interesting dissimilarities when comparing the descriptive statistics and regression results to research on rewards-based crowding. The data show that equity crowdfunding will likely pose great challenges to VC and business angel financiers in the near future. We discuss some research challenges and opportunities with these kind of data.

How does group size influence behavior in online trust dilemmas? We investigate cooperation in groups of 4 to 100 players. While overall levels of cooperation are stable across group sizes, we find significant gender differences: women increase cooperation with group size and cooperate significantly more than men in large groups. These results are robust when controlling for risk aversion, age, and other individual differences. They highlight the importance of studying behavior and gender differences in large groups.

This paper analyzes bargaining outcomes when agents do not have stationary time preferences (as represented by a constant discount factor) but are pressed by firm deadlines. We consider a dynamic model where traders with heterogeneous deadlines are matched randomly into pairs who then bargain about the division of a fixed surplus. A trader leaves the market when an agreement has been reached or when his deadline expires. Our analysis encompasses both the case of perfect and imperfect information about the partner’s deadline. We define, characterize and show the existence of a stationary equilibrium configuration. We characterize when delay occurs and when deadlines are missed in equilibrium and show that the payoffs of traders are strictly increasing and concave in own deadline, unless bargaining takes place under imperfect information and no delay occurs, in which case all pairs immediately agree on an almost even split. We provide comparative statics exercises and illustrate our results by some examples.

Why do portfolio managers actively manage their stock portfolios? The finance literature suggests the importance of financial incentives, effort, information and career concerns. We suggest that personality can also be a factor. We perform an experiment with industry experts. The experiment documents that, in a group decision setting, subjects with high aggression, measured by a standard psychology test, were much more likely to deviate from market tracking. In an individual decision setting, these same subject’s behavior was not significantly affected by aggressiveness. This result suggests that, in group settings, personality, rather than cognitive biases, might be the most important source of behavioral deviations from the rational choice paradigm.

Since the seminal papers of Fehr and Schmidt (1999) and Bolton and Ockenfels (2000), fairness has become an important discussion point in economics. Is it unfair that different people pay different prices for the same good or service? We provide what we believe to be a novel approach: We let normal everyday consumers play the role of sellers who have access to consumers’ data (and willingness to pay). A strong finding of behaviour in this setup is that subjects charge a fixed percentage (approximately 64%) of the willingness to pay from each of their subjects, leading to a fair, whilst uneven, distribution of prices. Interesting, this 64% price level does not change when we vary the number of sellers competing in the market.

http://dx.doi.org/10.1016/j.joep.2014.02.006 0167-4870/ 2014 Elsevier B.V. All rights reserved. q We are thankful for financial support from NSF Grant #SES-0819780 to Tamar Kugler and financial support from the Said Business Schoo University to Nir Vulkan. We thank Joe Broschak and Jerel Slaughter for their helpful comments. ⇑ Corresponding author. Tel.: +1 001 520 6267788; fax: +1 001 520 6214171. E-mail address: tkugler@eller.arizona.edu (T. Kugler). 1 At best, it can be said that personality is implicitly incorporated into the players’ payoffs. 2 Examples can be found in Barrick and Mount (1991), Hurtz and Donovan (2000), Hogan and Holland (2003), Mount, Barrick, and Strauss (1994) Mount, and Judge (2001), Poropat (2009), Roberts, Kuncel, Shiner, Caspi, and Goldberg (2007); but see Morgeson et al. (2007), for a different perspe

This study provides first empirical results on entrepreneurs' negotiation behavior. In a series of negotiation tasks, we compare persuasive behaviors and negotiation outcomes of entrepreneurs and non-entrepreneurs. Our results show that entrepreneurs make extensive use of emotions and arguments as means of persuasion. Due to their assertive behavior, they close fewer deals; however, when they close a deal, they make higher profits than non-entrepreneurs. These results demonstrate the relevance of studying entrepreneurs' interpersonal interactions as determinants of entrepreneurial success and highlight the role expressed emotions and arguments play in this context.

The economic boom of the USA in the 1990s was remarkable in its duration, the sustained rise in equipment investment, the reduced volatility of productivity growth, and continued uncertainty about the trend growth rate. In this paper we link these phenomena using an extension of the classic model of implementation cycles due to Shleifer (1986). The key idea is that uncertainty about the trend growth rate can lead firms to bring forward the implementation of innovations, temporarily eliminating expectations-driven business cycles, because delay is risky when beliefs are not common knowledge