Working papers

List of published articles is available here.

Working Papers (Available on SSRN or upon request)

  • "Secondary Market Listings in Equity Crowdfunding: The Missing Link?" with A. Lukkarinen (Aalto University School of Science)

Abstract: While equity crowdfunding has grown in prevalence, investors have had very few opportunities to exit their investments. To address this, several equity crowdfunding platforms have started considering developing secondary markets for buying and selling shares. Using detailed data from the world’s first secondary market for equity crowdfunding, we investigate whether committing to list on the secondary market after the fundraising campaign leads to greater investor participation and thus helps entrepreneurs to raise more money during the campaign. We find that in the early days of the secondary market, making a pre-commitment to list attracted more investors and larger investment sums. However, this positive effect disappeared after the first 18 months of secondary market operation, most likely because investors realized the lack of liquidity on the secondary market and thus the fact that secondary markets are currently unlikely to constitute a viable exit route. Our findings offer valuable insights to platforms aiming at launching secondary markets and regulators responsible for validating such initiatives. In particular, equity crowdfunding would benefit greatly from liquid secondary markets, which however are difficult to achieve due to high information asymmetries, price formation difficulties, reputational concerns, and competition effects from the primary market.


  • “How Do Entrepreneurs Use Reference Values During the Planning Process?” with D. Blaseg (ESADE Business School)

Abstract: Nascent entrepreneurs often overestimate the likelihood of success when planning their own activities, which usually results in excess market entry. But how do entrepreneurs adjust their expectations when they are given historical reference values of comparable projects? Does knowing the historical odds of success help entrepreneurs to make informed decisions about starting a venture by developing more realistic plans and expectations? Drawing on a unique dataset of reward-based crowdfunding initiatives that encompasses the different development steps starting from planning to the ultimate outcome of the campaign, we investigate whether and how nascent entrepreneurs use information on historical outcomes of comparable projects. Our findings suggest that entrepreneurs irrationally use the information to adjust their estimates to account for their belief that they are better than others once they see the historical values, thus resulting in an even higher level of optimism. This result holds across different levels of education, occupation, work experience, age, and gender. Finally, we show that entrepreneurs suffering from over-optimism driven by the irrational use of reference values are more likely to eventually launch a crowdfunding campaign and are also more likely to fail, indicating that the irrational use of reference values has meaningful economic consequences for entrepreneurs.

This paper was awarded the following prizes:

AOM Best Paper Award on Entrepreneurial Cognition 2020

KSG Entrepreneurship Research Award 2018


  • "The Impact of Venture Capital Holding on the Firms’ Life-cycle: Evidence from IPO Firms" with S. Amini (Leeds University Business School), A. Mohamed (Leeds University Business School), and N. Wilson (Leeds University Business School)

Abstract: Venture capital funds often remain shareholders of their investee companies, with representation on the board of directors, even after they have gone public. This paper examines the impact of venture capital ownership beyond the IPO listing on important consequential, corporate decisions in a firm’s lifetime, including time to dividend initiation. Using a sample of 1,409 US firms listed between 2000 and 2017, we find that venture capital funds delay the time to initiate dividends by approximately two years. The presence of venture capital shareholders further delays the use of external growth strategies (through acquisitions) and postpones the introduction to the corporate bond market, but does not influence the timing of seasoned equity offerings. Several robustness checks are performed, including controlling for possible reverse causality through the Entropy Balancing method. These results are consistent with the view that venture capital funds extend the growth phase of the firms’ life-cycle prior to becoming a mature firm. We show that the presence of VC funds in the IPO firm, at the time of these decisions, leads to positive stock price reactions when the decisions are made, suggesting they signal a certification effect for continued growth opportunities.


  • “Network Effects in Crowdfunding,” with P. Belleflamme (Université catholique de Louvain) and T. Lambert (Rotterdam School of Management, Erasmus University)

Abstract: We study the various network effects that are at work on crowdfunding platforms. From a theoretical perspective, we distinguish between network effects that relate to participation or to usage decisions. We use novel entrepreneur-backer data to identify their relative importance on project funding dynamics. We empirically show that backers decide on their usage of the platform based on intra-project activity – as documented by prior work – but also on inter-project activity. In a difference-in-differences research design, we estimate that inter-project network effects account for 2-3% in the increase of contributions that projects generate on a daily basis. Then we find that participation decisions create a positive feedback loop fueling the growth of the platform and explaining how positive inter-project network effects can arise. Our results represent the first attempt in the literature to unbundle the web of network effects on project funding dynamics and suggest that many existing results in the crowdfunding literature are driven by network effects.


  • “Equity Crowdfunding: The Influence of Perceived Innovativeness on Campaign Success,” with B. Le Pendeven (Audencia)

Abstract: We examine the impact of perceived innovativeness on the success of equity crowdfunding campaigns. Building on the investor perspective, we hypothesize a positive impact of perceived innovativeness on the campaign outcome. Our database covers 191 campaigns launched in France, drawing on 2,973 individual assessments of the perceived innovativeness of the start-ups involved, carried out by 176 participants with diverse backgrounds. We find support for our hypothesis from the investor perspective in that highly innovative projects attract more crowd investors and, in turn, raise more capital. We contribute to the understanding of how the crowd makes investment choices.