Start-up Funding via Equity Crowdfunding in Germany – A Qualitative Analysis of Success Factors

Entrepreneurs often struggle to find sufficient funding for their start-ups. A relatively new way for companies to attract capital is via an internet platform, locating investors who in return receive something in return for their ventures. Equity crowdfunding is one of several types of crowdfunding, and is also known as crowdinvesting in the German-speaking realm. This article predominantly advances the scientific knowledge regarding the success factors of equity crowdfunding for German start-ups. The study conducted nine qualitative interviews with start-ups and crowdinvesting platforms. Its first result is that German start-ups select crowdinvesting because (1) it is a funding opportunity and (2) it has an expected marketing effect. To organize the results of relevant success factors, the Crowdinvesting Success Model was designed by the researchers. This supports German entrepreneurs by presenting 20 important success elements that help to increase the capital collected during a campaign. The key finding is that an attractive business model, an appropriate preparation in the pre-campaign period, ongoing activities during the campaign, and corresponding advertising activities have a positive impact on a German start-up’s crowdinvesting campaign’s chances of success. The article closes with implications for theory and practice, as well as further research suggestions. JEL Codes: G21, G24, L26, M13