IMPACT OF SIGNALS ON CROWDFUNDING -- ANALYSIS OF CROATIAN CAMPAIGNS.

Crowdfunding success determinants are investigated from the very beginning of the crowdfunding phenomenon. Many authors around the world try to identify the important variables that determine the crowdfunding campaigns success. Information asymmetry problem among the project owner and the backer is more pronounced in crowdfunding financing, than by other alternative ways of finance like private equity or venture capital. Therefore, signaling is an important factor for backers when making a decision to finance any project, because signals lead to a reduction of information asymmetry as well as the level of uncertainty. In the literature there is no consensus on the impact of signals on crowdfunding campaigns success. Due to this, the aim of this study is the determination of the success signals for Croatian crowdfunding campaigns on Kickstarter. Using Ordinary Least Square regression, the results show how comments and updates positively influence the crowdfunding campaign success, while the project goal negatively affects. The impact of comments is statistically significant, but the impact of updates and project goal is not. The main limitation of this study is the relatively small number of Croatian campaigns used in Ordinary Least Square regression what prevented us from investigating the influence of other signals that can impact the crowdfunding campaign success. [ABSTRACT FROM AUTHOR]