Crowdfunded and then? The role of intellectual capital in the growth of equity-crowdfunded companies

Abstract

Purpose

This paper aims to investigate whether and to what extent equity crowdfunding (ECF) is able to build enduring businesses. This research explores the post-campaign growth of equity-crowdfunded companies and analyses the impact of intellectual capital (IC) on their growth. To achieve the above aim, we provide a theoretical framework that includes the three well-known dimensions of IC – i.e. human, structural and relational capital – as independent variables and company growth, meant as sales and employment growth, as dependent variable.

Design/methodology/approach

This research uses a quantitative methodology based on two regression analyses. The authors use hand-collected data on 51 successful equity-crowdfunded projects listed on seven Italian platforms.

Findings

The authors find that three variables, namely prior industry experience (human-capital), product innovation (structural-capital) and equity offered (relational-capital) are significant and positively related to the growth of equity-crowdfunded companies. In particular, prior industry experience positively influences sales growth; product innovation positively influences employment growth. Equity offered, instead, has a strong positive impact on both sales and employment growth. Companies that offer a larger percentage of equity during the campaign disclose higher probabilities of growth.

Practical implications

The study has useful implications for several stakeholders, in particular, founders, platform managers, crowdfunders, policy makers and authorities.

Originality/value

The results shed some light on the nascent research field related to post-campaign scenarios of equity-crowdfunded companies. This paper is the first to explore the impact of IC on the growth of companies funded through ECF.

Citation

Troise, C., Matricano, D., Candelo, E. and Sorrentino, M. (2020), "Crowdfunded and then? The role of intellectual capital in the growth of equity-crowdfunded companies", Measuring Business Excellence, Vol. 24 No. 4, pp. 475-494. https://doi.org/10.1108/MBE-02-2020-0031