Risky Donation for Rewarding Innovation? Examining Transformation of Technology Consumers into Crowdfunding Patrons

Reward-based crowdfunding platforms transform technophilic consumers into technology patrons by enabling them to donate for technology development in lieu of receiving the finished product as reward in future. Literature specifically on crowdfunding of technologies is tenuous, and researchers have not yet established the causal factors which entice technology consumers to donate. Using Elaboration Likelihood Model as theoretical base, we conduct a 2x2x2 mixed-design experiment to examine the effects of three core elements of crowdfunding (value of reward, waiting time to receive technology, and affective cues in donor appeal) on a potential consumer’s likelihood to donate. Our results show positive impact of reward, and negative impact of waiting time, but surprisingly no effect of affective cues. Significant interaction between reward and waiting time has also been observed. Apart from theoretical contributions, the findings have tactical implications for technology start-ups planning to raise funding through donations, and design implications for crowdfunding platforms.