Towards new frontiers: How attainment discrepancy affects exploratory behavior in crowdfunding

Abstract

Online crowdfunding has become a popular mechanism for creative projects that are not suitable for traditional financing means. Interestingly, creators on crowdfunding platforms frequently embark on projects beyond their prior expertise. In this study, we investigate how fundraising performance affects a creator's decision to venture into (i.e., explore) new project categories. Leveraging data from Kickstarter, we unveil a “V-shaped” relationship between creators’ funding attainment discrepancy (the gap between realized and target performance) and their tendency to explore novel project categories. Our finding challenges the conventional assumption that exceeding target performance would inhibit exploratory behavior. In addition, we show that when the attainment discrepancy transitions from negative to positive, the probability of exploration exhibits a discontinuous dip.