Crowdfunding and donors
Lotte van de Lustgraaf Economie en Bedrijfskunde Financiering en Organisatie Bachelor Thesis 10084932
Content
1 Introduction 4
2 Literature review 5
2.1 Motivation of charitable giving 5
2.2 Altruism and charity 7
2.3 Crowdfunding and charity 10
3 Method 13
3.1.1 Data 14
3.1.2 Demographic characteristics of the whole group of respondents 15
3.2 Design of research 17
3.2.1 Demographic characteristics 17 3.2.2 Motivational factors 18
3.2.3 Ranking of the factors 21
3.2.4 Ranking of crowdfunding financers: results 21 3.2.5 Ranking of donation part: results 21
3.2.6 Non-financers: results 22 3.3 Tests 22 3.3.1 Independent T-test 22 3.3.2 Robustness check 22 4 Results 23 4.1 Demographic characteristics 23 4.1.1 Gender 23 4.1.2 Age 23 4.1.3 Educations 23
4.1.4 Hours spent on social media pages 24
4.1.5 Social media accounts 24
4.2 Motivational factors 24
4.2.1 Total amount requested 24
4.2.2 Explanation and information 27
4.2.3 Reward 27
4.2.4 Relation between the respondent and project performer 27
4.3 Robustness check 30
4.3.1 Total amount requested adjusted 30 4.3.2 Relation between the respondent and performer
adjusted 30 5 Conclusion and concluding remarks 30
5.1 Literature review 30
5.2 Database 31
5.3 Summary of analysis 31
References 34
1. Introduction
This thesis studies financial contributions by crowdfunding and charitable giving.
Crowdfunding is a new way of financing different kinds of activities, such as individual-, start-up-, companies- and non-profit projects. Crowdfunding is embedded in the internet-world, where online platforms bring entrepreneurs and investors together (Mollick, 2014). The entrepreneur is the creator of the project and searches for individuals who would like to invest in the initiative. This creates the main idea of crowdfunding; the “crowd” finances the project.
In contrast to crowdfunding contributions, charitable giving is a form of financing that exists already for a long period of time. The Dutch research “Geven in Nederland 2013” by Schuyt, Gouwenberg and Bekkers (2013) shows different types of donors: households, inheritances, foundations, enterprises and voluntary work. In this thesis I will focus on donations of households, which are the largest source of charitable contribution for the non-profit organizations in the Netherlands1.
A remarkable giving characteristic of Dutch households in 20112 is the 80/20-rule, where 20% of the wealthy households are responsible for the 80% of the total collected money by households (Schuyt et al., 2013). The other way around this means that 80% of the households give 20% of the total amount collected by households, which is close to the idea of philanthropy of Schuyt et al. (2013), where most of the people donate a small amount of money.
This phenomenon of the 80/20-rule creates a potential to the new idea of
crowdfunding. Philanthropy, through crowdfunding, supposes large masses of people giving small contributions: Internet strategies give access to a large number of people in a fast, easy and effective way at low costs. Therefore I want to investigate the following question: is the
consideration to donate a financial contribution to charities the same for crowdfunding and charitable giving in the Netherlands?
This thesis is structured as follows; the next chapter will explore the relevant subject with a related literature review of charitable giving and crowdfunding. Chapter 3 will describe the data of “Nationaal Crowdfunding Onderzoek 2013” of van den Akker et al. (2013), where the data are obtained by a survey with 1085 respondents; these data are at the very heart of the research in this thesis. Chapter 4 will include the results of demographic characteristics and
1
Appendix 1 shows the sources of charitable contribution in 2011 in the Netherlands.
motivational factors of the decision-process to do a financial contribution. This thesis will finish with a conclusion.
The motivation for this thesis subject stems from my strong connection with charity organizations. I just started my own Dutch fund for saving rhinos in South Africa and did a lot of research into this kind of organisations. Charities differ a lot from the usual profit
organisation structures and in my view, crowdfunding can have a serious organisational consequence for charity organisations. I experienced this during my time with the Save the Waterberg Rhino organisation, as well as studying other non-profit organisations. Social media and direct relation with potential contributors play a large role in non-profit
organisations these days. The strategy to use online crowdfunding to address fast and large volumes of people differs from traditional face-to-face fundraising, which is slower and more time-consuming, but more personal.
2. Literature Review
I will review the literature on the motivation of charitable giving, altruism and charity and
crowdfunding and charity in the following paragraphs. The first section will introduce the
motivation of people to contribute to charities. The motivation of donating is useful in the further readings of this thesis. The research of Schuyt et al. (2013), which is mentioned in the introduction, will be reviewed briefly in section 2.2; I will provide a giving profile of
charitable givers in the Netherlands. Section 2.3 will explain the development in
crowdfunding in recent years, with a highlight on the non-profit crowdfunding. I will mention a couple of demographic specifications and motivational factors that can play a role in the decision-process to donate a financial contribution.
2.1 Motivation of charitable giving
One can distinguish three different ways of charitable giving, namely: voluntary donating money, goods, and time (Schuyt, 2001). Charitable givers, who are mentioned earlier in the introduction, consist of households, inheritances, foundations, enterprises and voluntary work (Schuyt et al., 2013). Charities are the receivers of the contributions and take care of the achievement of public interest (Schuyt et. al, 2013). This thesis focuses on charitable giving by monetary donations of households.
People’s motivation to contribute to charities can be explained by altruism. In general, altruism is an inner force of people to create a better world(Bekkers, 2013), but the social
view of Comte explains the individual as selfish by nature (Ritzer, 2008). To restrict egoism and increase the altruism value of individuals, Comte concluded that altruism in the value-system of individuals needs encouragement by external parties, for example the society. Even though egoism may dominate the human brain, individuals can have different levels of altruism values (Tonin & Vlassopoulos, 2010) (Rose-Ackerman, 1997).
In current economic terms the free-rider dilemma is similar to the old sociological pursuit of selfishness by Comte. The free-rider dilemma mentions two aspects in the negligence to contribute to a charity; people think that their contribution will not make the difference or people have the expectation that other people will contribute.Pure altruism is a matter of character, and contains the free-rider dilemma in case of a contribution to a public good (Rose-Ackerman, 1997), especially in case of large numbers of potential contributors. Expecting others to reach successful fulfilment of the goal, the pure altruist will stay aside or will switch to other ways of spending their financial contributions. A pure altruist would be “just as happy” if someone else contributes to the charity instead of giving his own
contribution. Rose-Ackerman (1997) specifies two situations of individual preferences, in which the "free-rider dilemma" can be overcome: the “warm glow” feeling and the “buying in” of the program. Individuals with a “warm glow” altruism value derive satisfaction from the contribution to the wellbeing of other people immediately, regardless to the acts or
contributions of others. Giving “as such” plays a role in the individual utility function; it is the intrinsic motivation of the act of helping. The “buying in” of the program means that the individual feels involvement, co-ownership, of the program or goals only after a certain level of financial contribution. In summary it is not self-evident that people contribute; individuals will donate if they feel a connection with a charity and receive enough utility from the marginal contribution to a charity.
Intrinsic motivation is not the only drive of charitable giving. Bénabou and Tirole (2006) put forth a theory where charitable giving is seen as a prosocial behaviour. Publicity, social signalling and reputation play a role to reach individual benefit of charitable giving. Individuals give as long as they can show their financial contribution to others.
Besides the different forms of altruism values, Sugden (1984) introduces reciprocity. People who derive utility from a public good are willing to contribute to that specific good. People are not obligated to contribute to a public good, which is similar to the idea that people are not obligated to contribute to non-profit charities. Charitable giving is an individual choice, but the moral pressure of the environment leads to (e.g. financial) contributions by individuals. There is a pressure on individuals to meet the norm to contribute to the public good of a
group3 and to prevent being in an outcast position when they do not contribute. Reciprocity means that the individual gives at least the average effort of the members of the group when the individual intended initially to contribute the same effort or more. That people compare their contribution with the contribution of others derives from a practical and moral standard of most people; it creates a situation where people give approximately the same amount of money as long as other people contribute. This compares with the idea of conditional
cooperation of public goods; individuals deliver equally contributions as long as someone else does not deviate from this average giving behaviour (Fischbacher, Gächter & Fehr, 2001).
Giving behaviour of individuals can also be explained by explicit social values
(Schuyt et al., 2013). The social values includes altruism, self-sacrifice, justice and generosity. These social values create social giving standards, which are strengthened by reputation, effort of celebrities and the appreciation of gifts by charities, whereas they are weakened by betrayal of the people’s confidence in charities. The social character is also encouraged by national mass campaigns to help victims of international disasters, for example typhoons or earthquakes (Bekkers & Wiepking, 2011). Besides the awareness of the need for help in the mass media, Bekkers and Wiepking (2011)4 also describe other mechanisms that influence giving behaviour in general. These mechanisms are solicitation, costs and benefits, altruism, reputation, psychological benefits, values and efficacy.
2.2. Altruism and charity
The Netherlands scores an eighth position in the World Giving Index of 20125, which includes 146 countries (Charities Aid Foundation, 2013). Dutch people mostly contribute money; helping a stranger6 and volunteering time are the second and third most popular means of giving. The high GDP/capital of 601 billion Euros in the Netherlands (Schuyt et al. 2013) can explain the eighth position in the World Giving Index 2012.
The latest research of “Geven in Nederland 2013” by Schuyt et al. (2013) shows the characteristics of Dutch households who give money to charities in 2011; 85% of the Dutch households gave money to charities in this period. Table 1 gives the descriptive statistics of
3 The definition of a group has an extended domain in this case. The group can consist of
employment, race, religion, politics etc. The scale can be local, national and international. 4
The study “Geven in Nederland 2013” concentrates on the situation in the Netherlands. Although Bekkers and Wiepking (2011) have a broader scope, the main conclusions are in line with the Dutch evidence.
5
The World Giving Index of 2012 describes the results in 2011.
6 The World Giving Index of 2012 asked respondents in 146 different countries if they helped a
Table 1 Source: Schuyt et al. (2013) p.56 – 58.
Percentage Amount of money*
Demographic characteristics
Male 87 251
Female 91 194
Born after 1980 87 147
Born between 1971 and 1980 90 219
Born between 1961 and 1970 89 207
Born between 1951 and 1960 88 226
Born between 1941 and 1950 90 229
Born before 1941 94 432
Social economic characteristics
**Education; basis, lbo, mavo 85 127
**Education; mbo/havo/vwo 88 206
**Education; hbo/wo 95 348
Philanthropy attitude Number of donation requests
None 80 150
1 - 4 times 96 246
More than 4 times 94 402
Social pressure Low 84 107 High 93 301 Altruism values Low (1-3) 78 112 High (4-5) 94 262 Faith in charities Low (1-3) 85 178 High (4-5) 98 310
*Amount of money in Euros. **Education follows the Dutch education system. The complete table of the profile of households is illustrated in appendix 2, which also includes distinction by habitat, relationship, children, work or volunteering, income, house and religion.
the research by Schuyt et al. (2013). It indicates the percentage of households that give and the average amount distinguished by gender, age, and education7. I will describe the same demographic characteristics, such as gender, age and education, in the results of this thesis with the data of “Nationaal Crowdfunding Onderzoek 2013” of van den Akker et al. (2013).
Table 1 reveals that there is a higher chance that women donate, while men donate a higher amount on average. The oldest generation (above 70 years old) have both the highest percentage of giving and donate a remarkably higher average sum to charities, approximately the double amount. Individuals with a higher education have a higher percentage and average amount in charitable giving.
The last part of table 1 reflects four factors that influence the philanthropy attitude of an individual. These factors include the number of donation requests, social pressure, altruism value and the confidence in charities. Table 1 indicates that solicitation leads to a higher chance of giving and the individuals who have been requested more than four times had the highest average sum of donations. The results of table 1 are similar to the evidence of the solicitation mechanism of Bekkers and Wiepking (2011), which say that the highest charitable givers receive more requests for donating, and this repeated requests increases the chance on donating. Unfortunately, the table of “Geven in Nederland 2013” does not provide any
information about how the individuals are approached by charity organisations, but according to Bekkers and Wiepking (2011) the psychological benefit of the giver grows in case of a strong affinity to the fundraiser. A bond of similarities encourages this connection even if the fundraiser is a complete stranger. There are different ways of solicitation; face-to-face, media (such as television and papers), advertising, big festivities are the traditional way of charitable giving, while the Internet, crowdfunding and SMS are new phenomena in donations. The combination between an increasing number of requests in table 1 of Schuyt et al. (2013) and the methods of requesting by Bekkers and Wiepking (2011) will encourage a favourable situation of success in charitable giving.
The next part of table 1 includes the social pressure, which is strengthened by the close inner-circle and environment of a donor (Bekkers & Wiepking, 2011). The low social
pressure, in table 1, does not even reach the half average sum of money collected in case of high social pressure and the low social pressure shows a lower percentage of charitable giving. The low altruism value shows the lowest chance on charitable giving and a low average sum of money in table 1. This combination creates a large difference in chance on giving and the
average sum of money between low - and high altruism. This is self-evident because the prosocial behaviour of an altruist is common to give money, goods or voluntary time to charities. The altruism value is tested in the results of this thesis, where respondents of the survey value the importance of the reward factor.
The faith in charities, which are mentioned in the social giving standards of Schuyt et al. (2013) above, are weakened by betrayal of the individual’s confidence in charity
organisations. A high confidence in charities results in almost 100% chance of charitable giving and a high average sum of donations, while a low trust in charities results in almost the half of the average sum of donations in table 1. Negative information in media creates high fluctuations in the trust in charities and will change the giving pattern immediately (Algemeen Dagblad, 2013).
Table 1 summarizes the following giving profile in the Netherlands; households with a high altruism value, high confidence in charities, high social pressure combined with regular requests of giving by charities results in more and higher donations (Schuyt et. al, 2013).
The four factors that are explained in the last part of table 1 are also reflected in the database of the survey of van den Akker et al. (2013), which I will use. Unfortunately, the factors will differ a little bit in specific wording of the questions than in the research of Schuyt et al. (2013). The difference in the factors altruism, social pressure, number of donation requests and faith in charities will be explained in chapter 3.
2.3 Crowdfunding and charity
Crowdfunding is a new form of financing on online platforms. Mollick (2014) describes the main issues of crowdfunding briefly; “Crowdfunding refers to the efforts by entrepreneurial individuals and groups – cultural, social, and for-profit – to fund their ventures by drawing on relatively small contributions from a relatively large number of individuals using the Internet” (p. 2). The “crowd”, existing of a large group of individuals, finances all different kinds of online projects with a strict goal and end date (Wash, 2013). Banks are starting similar online platforms where their customers can participate in projects recently. For example, the online platform SEEDS of the ABN AMRO (ABN AMRO, 2013) and ING partnered with
crowdfund ‘Start Some Good’ in Australia (Banken.nl, 2013). These banks offer
crowdfunding as a new alternative - and additional financial tool to finance new initiatives of entrepreneurs, while the traditional forms of fundraising are not replaced by crowdfunding.
There are four main forms of crowdfunding; namely, the patronage -, lending -, reward-based – and investor model (Mollick, 2014). The names are descriptive for the different
drivers related to crowdfunding. The patronage – and reward-based model are the most important forms for this thesis. The patronage model is similar to the altruism mentioned above; these investors do not expect any reward in return to their investment (Mollick, 2014) and their financial contributions could be regarded as donations. While the investors of the reward-based model prefer to benefit from their initial investment with a reward that could take any form invented by the entrepreneur (Mollick, 2014). The rewards are mostly seen as an appreciation of the entrepreneur of the initial financial contribution (Wash, 2013). The importance of the rewards is ranked in the data of “Nationaal Crowdfunding Onderzoek 2013” of van den Akker et al. (2013), which is used in this thesis. The preferences regarding rewards can be compared between the crowdfunding financers and donors, because both groups ranked the importance of rewards in the survey.
Crowdfunding creates some positive and negative effects for the different type of users such as the entrepreneurs, funders and platforms (Agrawal, Catalini & Goldfarb, 2013). The online platforms are not yet obligated to have strict regulation to encourage the security of safe investments, which leads to uncertain quality and lack of transparency of the investment projects on the internet platforms (Read, 2013). The inner-circle of friend and family deliver the first financial contributions of projects (Cumming & Johan, 2009), which are not
specifically regarded as crowdfunding projects. These investors have a close relationship with the entrepreneur, which can reduce the degree of asymmetric information and risks and increase the reliability of a project. But even for these investors the risks will not completely disappear (Cumming & Johan, 2009).
A high amount of financial contributions in the early stage shows the reliability of the entrepreneur, which attracts outside investors into the project (Conti, Thursby & Rothaermel, 2013). There is a distinction between internal – and external investors; where internal
investors are part of the inner-circle of the entrepreneur, the external investors belong to the group of investors who find crowdfunding projects on Internet through online platforms or social media. The success of the project is stimulated by quality signals of the project and/or entrepreneur, such as sum of money already invested, and the number of reliable social media followers (Mollick, 2014). The signals of reliable social media followers are real social media accounts; people who spend much time on social media pages and the account already exist for a long period. The trust in crowdfunding will increase if crowdfunding platforms have a general hallmark, like the ANBI status of charities.
This thesis will test the preferences of a crowdfunding financer towards a
(2013) are the relation between the crowdfunding investor and entrepreneur, the quality of a crowdfunding project and the providing information by crowdfunding projects. The factors
relation, quality and information providing will be further explained in chapter 3 of this thesis.
The patronage model, the donation model, of crowdfunding has not yet been used often by charities, while the innovations in technology create an increased access for
charitable giving (Bekkers, 2013). The easy international connection between online investors and entrepreneurs, which is not limited by distance (Agrawal, Catalini & Goldfarb, 2011) and the increasing use of smart phones (Bekkers, 2013) are technological innovations that can stimulate the charitable giving by crowdfunding. The Internet is the most popular among the younger generation and this could lead to an increasing charitable giving by the younger generation. The oldest generation of charitable givers, above 70 years, will not use the Internet as often, which could create a contrast with the giving pattern of the “Geven in Nederland 2013” research by Schuyt et al. (2013). Besides the technological innovation, the low costs and easy advertising tools create a perfect situation for fundraising by crowdfunding (Wash, 2013).
The patronage models have two forms of collecting donations in projects on online platforms; the collected money of charitable givers is sent back in case of failure to collect the pledge, or the collected money stays in the funds of the charity irrespective of the final score of the collected money (Wash & Solomon, 2014). The last form of the patronage model leads to a higher amount of donations in the final stage of the project; it secures that the charitable giving sticks to the project (Wash, 2013). There is less motivation of higher giving in case of the send back method.
Schwienbacher and Lambert (2010) show that charities collect a higher amount of money than profit organisations by crowdfunding. This could be explained by the
considerations mentioned above, as most donations come from people who have a strong altruism value and affinity with the charity to create a better world (Glaeser & Shleifer, 2000). Investors have the preference to deliver gifts to non-profit charities instead of for-profit, because non-profit organisations know how to use money in a correct way and the gifts are for public interest (Rose-Ackerman, 1997).
Brabham (2008) shows the demographic characteristics of investors on online platforms in his research. The relevant and dominant characteristics of the platform users in his study are: white, higher educated and have a high speed Internet connection. The
demographic characteristics of education and hours spend on social media pages of the respondents of my survey are analysed in this thesis. The approach of request to make a
financial contribution influences the value of charitable giving (Gerber, Hui & Kuo, 2012), which is similar to the results of the solicitation mechanism of Bekkers and Wiepking (2011) in charitable giving. In the end, altruism values are the motivations why people donate by crowdfunding, which is similar to the motivations why people donate in general (Wash, 2013). Donors who give by crowdfunding have a strong affinity and commitment with the project (Gerber et al., 2012).
Although I expect that the overall demographic characteristics overlap between the crowdfunding financers and charitable givers, the crowdfunding group will differ in age and in internet and social media skills. The hours spent on internet causes an age difference between the charitable giver and crowdfunding financers and for this reason, I expect a larger attraction from crowdfunding to the younger generation.
In my research I will focus on similarities in demographic characters and motivational factors between crowdfunding financers and charitable givers. I will research the following central hypothesis:
The demographic characteristics and motivational factors of crowdfunding financers and charitable givers8 with internet connections are the same; specifically in gender, age, education, hours spent on social media, total amount requested, explanation about the project/charity, reward and relation between entrepreneur and investor.
I will focus on gender and age, level of education and times spent on social media, which are the demographic characteristics mentioned in the central hypothesis. I also investigate the importance of motivational factors for crowdfunding financers and charitable givers, such as
the amount requested, the explanation of the project and the information provided, the rewards given to the contributor, the quality of the online platform/website and the relation between the respondent and performer.
3. Method
The dataset, the survey and the original research of “Nationaal Crowdfunding Onderzoek 2013” of van den Akker et al. (2013) were published online and are public available9. The
8 The researches approached the respondents of the survey by Internet. Therefore I mention charitable
givers with Internet connection in the central hypothesis.
online database did not include the demographic information about the respondents, but I managed to obtain extra information from the researcher K. van Vliet under the restriction not to publish the dataset on the internet.
The general information about the dataset and survey is explained in section 3.1. After the general information about the dataset, I will explain the design of specific data used in this thesis in section 3.2. This section discusses the survey questions about the demographic characteristics and motivational factors of the charitable givers and crowdfunding financers, the test distribution and the robustness check.
3.1.1 Data
The “Nationaal Crowdfunding Onderzoek 2013” by van den Akker et al. (2013) gathered the data used in this thesis. All four initiators of the crowdfund research are familiar with
crowdfunding and these researchers want to develop crowdfunding into a more common financial tool. To achieve this goal, you need to know more about the motivation of crowdfunders.
This motivation is examined in a Dutch survey. The total survey included 50 multiple choice - and 4 open questions. The survey splits up in three parts; part 1 includes introductory questions of crowdfunding and crowdfunding platforms, part 2 consists of questions related to financial contributions by crowdfunding financers and part 3 contains of questions related to regular monetary donations and financial investments in enterprises. The survey finishes with a couple of questions about the demographic characteristics about the respondent, which are the same questions for everyone.
Every respondent follows an individual routing through the questionnaire; the specific route depends on the successive answers of the respondent. This creates a situation where there are different numbers of observations in relation to the successive questions.
To examine the motivation of crowdfunding, donating in charities and investing in enterprises, the survey includes questions about factors that could play a role in the decision-making process to give a monetary contribution. Most factors are only mentioned in part 2;
crowdfunding, but some factors of crowdfunding overlap with the factors of part 3; giving donations and investing in enterprises. The respondents were invited to rank the factors by a
scale from one to five: value one is not an important factor and five is a very important factor. There were 1277 Dutch respondents who joined the survey in the period of 22 January 2013 till 22 March 2013, but only 1085 participants finished the survey. The characteristics of the whole group of respondents are summarized in the following section. The respondents
were requested to participate in the survey by the network of a Dutch bank, called Rabobank, some Dutch online crowdfunding platforms and the network of the four researchers of
“Nationaal Crowdfunding Onderzoek 2013”. The respondents were contacted in different social media pages, such as Linkedin and Twitter, and some respondents were directly approached by mail. One remark should be made here; the researches approached the
respondents through Internet, which will cause a high social media use and high response on the term crowdfunding. The high social media and crowdfunding use gives a sample selection bias to the results. However, the sample selection bias cannot be avoided and suits the
purpose of this thesis.
3.1.2 Demographic characteristics of the whole group of respondents
The total number of respondents who finished the survey of “Crowdfunding Onderzoek 2013” is 1085. The demographic characteristics of the respondent group are illustrated in table 2. This group consist of 63,13% males and 36,87% females. Approximately 80% of the
respondents have an age between the 25 and 54 years, but most of the respondents belong to the 25-34 category. Approximately, half of the group respondents has at least one university diploma and 42,4% has an academic master, which leads to a high-educated group. The hours spent on social media is for three fourth of the total respondents between the zero and two hours. The top three of popular social media accounts are Linkedin, Facebook and Twitter. Less than half a percentage of the selected social media use indicates that the respondents do not have an account (see table 2 on the next page, last line). These are 16 respondents of a total 1085 people, which is 1%.
Table 2: Demographic characteristics distribution of the whole group of respondents. Observations Percentage Gender Male 685 63,13% Female 400 36,87% 1085 Age <18 3 0,28% 18-24 93 8,57% 25-34 333 30,69% 35-44 291 26,82% 45-54 242 22,30% 55-64 98 9,03% >65 25 2,30% 1085 Education Primary school 3 0,28% Vocational training 3 0,28% MAVO/VMBO 13 1,20% HAVO 23 2,12% VWO 19 1,75% MBO 38 3,50% HBO 372 34,29% Bachelor university 89 8,20% Master university 460 42,40% Post-doc 55 5,07% Other 10 0,92% 1085 Hours spend on social media
<1 415 38,28% 1 | 2 408 37,64% 2 | 3 153 14,11% 3 | 4 53 4,89% >4 55 5,07% 1084
Social media % of total accounts % of 1085
respondents Facebook 897 22,92% 83% Twitter 756 19,32% 70% Google+ 324 8,28% 30% Linkedin 1009 25,79% 93% Youtube 626 16% 58% Pinterest 227 5,80% 21% Hyves 58 1,48% 5% None 16 0,41% 1% 3913
3.2 Design of research
3.2.1 Demographic characteristics
In this thesis the respondents are separatedinto four groups: crowdfunding & donations,
crowdfunding, donations and non-financing. This is useful in the evaluations of the
preferences and characteristics about crowdfunding financers and charitable givers. The non-financing group are the respondents who are not involved in crowdfunding or charitable giving; the related indication in the tables is “none”. Each respondent that finished the whole survey provided information about their demographic characteristics such as gender, age, education10, hours spent on social media pages and the different accounts of social media of the respondents. The different groups are tested in relation to this characteristics; it is important to know whether the four groups have approximately similar distributions. The respondents who did not complete the survey are eliminated. Figure 1 illustrates the distribution of the respondents in the different four groups that fill in their demographic characteristics.
Figure 1A: The distribution of the respondents with complete demographic characteristics11.
10 Education follows the Dutch education system; primary school, vocational training, MAVO/VMBO,
HAVO,VWO, MBO, HBO, bachelor university, master university and post-doc.
11 Not every respondent answered the demographic characteristics questions. This results in larger
numbers of respondents in the motivational factors. 1085 respondents 351 crowdfunding 682 no crowdfunding 351 donations 131 none 278 crowdfunding and donations 73 only crowdfunding
Figure 1B: The distribution of the respondents according to the different parts of the survey per factor.
*The factors are explained in table 3.
The demographic characteristics in the survey consist of multiple-choice questions. The exception is the question on the social media accounts; the respondent can have none or more than one social media account on different pages. In case of more social media accounts, the respondents have to indicate the social media account and it was possible to select more than one answer.
3.2.2 Motivational factors
To examine the motivation of crowdfunding, donating in charities and investing in enterprises, the survey includes questions about factors that could play a role in the decision-making process in relation to a monetary contribution. Part 2 of the survey includes questions about crowdfunding and part 3 includes questions about donations to charities. Only
corresponding items in part 2 and part 3 are tested in this thesis. Table 3 summarizes these corresponding items between the two different parts of the survey.
The survey includes a specific routing of individual respondent. This creates a
situation where there are different numbers of observations per question. Figure 1B shows the 1278 respondents Crowdfunding: 439 No crowdfunding: 705 Amount1: 420 Amount2: 420 Decision2: 410 Relation: 410 Decision1: 390 The total amount requested2: 390 Project385: Goals: 385 Entrepreneur: 385 Earlier projects: 385 Financial planning: 385 Risks: 385 Part 2: Donations: 566 Crowdfunding & donations: 311 Part 3:
number of respondents per factor in the different parts of the survey. Crowdfunding and
donations financers and crowdfunding financers answered part 2; this means that the total
group of crowdfunding financers participated in part 2. Depending on the question involved,
part 2 is answered by a maximum of 420 respondents and a minimum of 385 respondents. Part 3 is divided into part 3: crowdfunding and donations and part 3: donations. There are
311 respondents that answered part 3: crowdfunding and donations and 566 respondents that answered part 3: donations. These numbers of respondents count to a higher total than the respondents presented in section 3.2.1, because not every respondent completed the survey with their demographic characteristics.
The motivational factors include a ranking on a scale from one to five, where one indicates a not important factor, while value five is a very important factor. These factors will be tested with an independent t-test in the results; my purpose is to evaluate if there is a significant difference in the preferences between the crowdfunding financers and donors. The independent t-test will be explained in section 3.2.3. The remaining factors of crowdfunding and donations, besides the overlap factors, are ranked and described per specific group. Appendix 3 illustrates an example of a question of the ranking of the remaining factors and table 13 and 14 show the results of the remaining ranking factors of the specific groups.
Of course, the routing of the non-financing group prohibited participation in the ranking questions related to preferences in crowdfunding and donating. These respondents were invited to answer on theire motives not to participate in financial contributions on online platforms. The factors are summarized in table 4. The non-crowdfunding respondent selected three factors that indicated the most important reasons not to participate in crowdfunding. This means that in case of the non-financing population we do not have the correct data to compare their answers with the ranking factors of the other groups.
Table 3: Explanation of the corresponding factors. This table is based on the questions of the survey “Nationaal Crowdfunding Onderzoek 2013” by van den Akker et al. (2013).
Corresponding factors
Part of the
survey Short name Question Observations
Total amount requested
Crowdfunding (Part 2)
Amount (1) Which role plays the total amount requested in the decision of the amount to do a financial
contribution? 420
Decision (1)
Which role plays the total amount requested in the decision to give a financial
contribution? 390
Donations (Part 3)
Amount (2) & (3)
Which role plays the total amount requested in the decision to give a donation to a charity? Explanation about the project/charity Crowdfunding (Part 2) The total amount requested (1)
Which role plays the explanation of the total amount requested in the decision to do a
financial contribution? 390
Project Which role plays the information on the project in the decision to do a financial
contribution? 385
Goals Which role plays the information on the goals of the project in the decision to do a financial
contribution? 385
Entrepreneur Which role plays the information on the entrepreneur of the project in the decision to
do a financial contribution? 385
Earlier projects Which role plays the information on earlier projects of the entrepreneur in the decision to
do a financial contribution? 385 Financial
planning
Which role plays the information on the financial planning in the decision to do a
financial contribution? 385
Risk Which role plays the information on the risks of the project in the decision to do a financial
contribution? 385 Donations (Part 3) Explanation charity (1) & (2)
Which role plays the explanation on the charity in the decision to give a donation to a charity?
Reward
Crowdfunding (Part 2)
Amount (4) Which role plays the reward in the decision
of the amount to do a financial contribution? 420 Decision (2) Which role plays the reward in the decision to
make a financial contribution? 410 Donations (Part
3) Reward Which role plays the reward in the decision to give a donation to a charity?
Relation between the respondent and
project performer
Crowdfunding
(Part 2) Relation (1)
Which role plays the relation with the project performer in the decision to do a financial
contribution? 410
Donations (Part 3)
Relation (2) &
(3) Which role plays the relation with the project performer in the decision to give a donation to a charity? *Donation (Part 3) is divided in part 3: crowdfunding & donations and part 3: donations
Table 4: Question why the respondent did not participate in crowdfunding.
What is the most important reason not participate in a financial contribution through crowdfunding? I never looked on online platforms
Nobody ever requested me to make a financial contribution I can use my money better at the moment*
I have never seen interesting projects*
I have never seen interesting projects with a good reward* I do not trust this way of financing*
The risk is too high* It is too complicated*
It was too roundabout to do an financial contribution The project or enterprise did not collect enough money yet I was too late, the campaign was already finished
The information was not complete
* This motive performed is named twice in two different questions.
3.2.3 Ranking of the factors12
The next three sub-sections describe the ranking of factors in the decision-making process of giving a financial contribution by crowdfunding financers and charitable givers. The
crowdfunding financers have a larger ranking scheme, because the crowdfunding part of the survey was more extended. The factors of the crowdfunding & donors and donations result from similar questions. The non-financing group participated only in the motive: why they did not contribute by crowdfunding; they had a maximum of three possible answers.
3.2.4 Ranking of crowdfunding financers: results
Quality, passion and information about the project are the most important factors in the
decision-process to give a financial contribution to a crowdfunding project.
3.2.5 Ranking of donation part: results
Crowdfunding & donors and donations ranked the factors of the decision-making process of giving a financial contribution to a charity exactly in the same way. The explanation of the
charity, the way of request and the total amount money requested are the most important
items in the decision-process. The leading factor of explanation is similar to the top three ranking preferences of the crowdfunding financers.
3.2.6. Non-financers: results
The non-financers indicate that they never had a request to do a financial contribution, they
could use their money better or never looked on online platforms. For this reason they never
did a financial contribution by crowdfunding.
3.3 Tests
The following sections reveal the tests and the robustness check used in this thesis.
3.3.1 Independent T-test
I used an independent t-test to compare the overlapping factors between the crowdfunding population and the charitable givers. The unpaired t-test compares the means between two independent samples for interval data with an approximately normal distribution (Keller, 2009). However, the survey used in this thesis consists of ordinal data with a scale from one to five for the relevant factors. Because of the large population in the survey, I interpreted the ordinal data with related frequencies as interval data for the t-test of comparing the means of the different factors between crowdfunding financers and charitable givers. In case of non normal distribution combined with a small population and ordinal data I could have considered to use the Wilcoxon-Mann-Whitney test, but the results in test methods will provide identical conclusions (Institute for digital research and education, 2014).
3.3.2 Robustness check
To check if the results are the same when the scale changes, I will change the existing factor scale from one to five to a scale from one to three. The changed scale is illustrated in table 5. After changing the scales in the overlapping factors I have repeated the same independent t-test on the overlapping relevant factors mentioned in section 3.2.2.
Table 5: Changed scale robustness check Original scale New scale 0 1 1 2 2 3 4 3 5
4. Results
This chapter summarizes the results of this thesison the evaluation of the similarities in the mentioned characteristics of crowdfunding financers on the one hand and charitable givers with internet on the other hand. Section 4.1 shows the results of the demographic
characteristics of the four groups: crowdfunding, crowdfunding & donations, donations and
non-financers. Section 4.2 shows the results of the analyzed motivational factors. The
respondents of part 2 of the survey formed the total group of crowdfunding financers.
4.1 Demographic characteristics13
4.1.1. Gender
Most groups in table 6 reflect a very comparable distribution between men and women, except for the crowdfunding financers. The crowdfunding financers show a significant difference of 10% in table 6. The difference results from the gender distribution, where less than 50% of the respondents of the crowdfunding financers are female.
4.1.2. Age
There are significant differences in the age distribution in the four groups. Only the
comparison between crowdfunding & donations with donations does not show a significant difference, but the t-test result of 10,08% is close to a 10% significance level. The average age of crowdfunding and non-financing is lower than the age of crowdfunding & donations and donations.
4.1.3. Education
All groups shows comparable results in education levels; most respondents have a university master diploma or a HBO diploma. However, the distribution of the education differs
significantly in the comparison of crowdfunding & donations with donations and none. There is a 1% significance level between crowdfunding & donations with donations and a 5% significance level between crowdfunding & donations with none. This results from the fact that crowdfunding & donations have the highest education mean level.
13 The demographic characteristics are summarized per group in table 5. The corresponding t-test
4.1.4. Hours spent on social media pages
There is a 1% significance level in the comparison of crowdfunding & donations with
donations and none, but also in the comparison of crowdfunding with donations. This results
from the fact that crowdfunding have a higher average time spent on social media pages while
donations have the lowest average time spent on social media pages. The other comparisons
do not show significant differences in the distributions.
4.1.5. Social media accounts
The top three of social media accounts are the same for every group: Linkedin, Facebook and Twitter.
4.2 Motivational Factors
The motivational factors to test similarity in the decision-making process of crowdfunding financers and donors are: total amount requested, explanation about the project/charity,
reward, website and relation between the respondent and project performer. The factors are
evaluated in the independent t-test.
4.2.1 Total amount requested
There is a significant difference on a 5% significance level in the valuation of the total amount requested between the crowdfunding factor decision(1) and the donations factor
amount(3). Donations valued the amount(3) the highest; while crowdfunding & donations
Table 6: Demographic characteristics of the groups. Whole group
Crowdfunding
& Donations Crowdfunding Donations None
Obs % Mean Obs % Mean Std Obs % Mean Std Obs % Mean Std Obs % Mean Std Gender Male 685 63,13% 169 61% 52 71% 347 63% 90 69% Female 400 109 21 204 41 Total 1085 1,36366 278 1,392086 0,4890962 73 1,28767 0,4558098 551 1,37024 0,4833065 131 1,31298 0,4653852 Age <18 3 0% 0 0% 0 0% 0 0% 1 1% 18-24 93 9% 9 3% 7 10% 45 8% 27 21% 25-34 333 31% 75 27% 33 45% 157 28% 62 47% 35-44 291 27% 86 31% 20 27% 152 28% 20 15% 45-54 242 22% 73 26% 9 12% 126 23% 17 13% 55-64 98 9% 28 10% 3 4% 56 10% 4 3% >65 25 2% 7 3% 1 1% 15 3% 0 0% Total 1085 3,98618 278 4,205036 1,119749 73 3,60274 1,050658 551 4,06534 1,220766 131 3,28244 1,054476 Education Primary school 3 0% 0 0% 0 0% 1 0% 2 2% Vocational training 3 0% 1 0% 0 0% 2 0% 0 0% MAVO/VMBO 13 1% 0 0% 2 3% 8 1% 0 0% HAVO 23 2% 6 2% 0 0% 10 2% 4 3% VWO 19 2% 4 1% 0 0% 9 2% 3 2% MBO 38 4% 6 2% 3 4% 19 3% 5 4% HBO 372 34% 80 29% 25 34% 201 36% 48 37% Bachelor university 89 8% 26 9% 6 8% 43 8% 10 8% Master univeristy 460 42% 138 50% 31 42% 221 40% 57 44% Post-doc 55 5% 16 6% 5 7% 30 5% 2 2% Other 10 1% 1 0% 1 1% 7 1% 0 0% Total 1085 7,805529954 278 8,100719 1,389985 73 7,89041 1,67134 551 7,74592 1,701565 131 7,72519 1,549459 Hours spend on social
media <1 415 38% 88 32% 19 26% 245 44% 42 32% 1 | 2 408 38% 122 44% 29 40% 193 35% 49 37% 2 | 3 153 14% 36 13% 15 21% 70 13% 24 18% 3 | 4 53 5% 18 6% 4 5% 20 4% 6 5% >4 55 5% 14 5% 6 8% 23 4% 10 8% Total 1084 2,008302583 278 2,093525 1,074093 73 2,30137 1,16291 551 1,88022 1,039313 131 2,18321 1,162236 *The yellow numbers show the significant differences in means between the different groups.
Table 7: T-test of the demographic characteristics.
Crowdfunding &
Donations Crowdfunding Donations None
Gender
Crowdfunding & Donations 0,0889* 0,5423 0,1158
Crowdfunding 0,1521 0,7065
Donations 0,2105
None
Age
Crowdfunding & Donations 0*** 0,1006 0***
Crowdfunding 0,0008*** 0,0388**
Donations 0***
None
Education
Crowdfunding & Donations 0,325 0,0014*** 0,0190**
Crowdfunding 0,4903 0,4885
Donations 0,8928
None
Hours spend on social media
Crowdfunding & Donations 0,1704 0,0066*** 0,4566
Crowdfunding 0,0042*** 0,4876
Donations 0,0069***
None
The t-test ***, **, * indicate statistical significance at 1%, 5% and 10%, respectively. Table 8: Social media accounts of the four groups.
Social Media
Accounts CF & Don Crowdfunding Donations None
Frequency Percent Frequency Percent Frequency Percent Frequency Percent
Facebook 240 22,33% 62 22,06% 444 22,99% 121 24,49% Twitter 222 20,65% 57 20,28% 363 18,80% 93 18,83% Google+ 92 8,56% 28 9,96% 151 7,82% 38 7,69% Linkedin 268 24,93% 70 24,91% 509 26,36% 129 26,11% Youtube 164 15,26% 40 14,23% 318 16,47% 82 16,60% Pinterest 70 6,51% 22 7,83% 108 5,59% 22 4,45% None 4 0,37% 1 0,36% 9 0,47% 0 0,00% Total 1075 100,00% 281 100,00% 1931 100,00% 494 100,00%
4.2.2. Explanation and information
The survey includes a lot of different factors of explanations and provides extra information in the crowdfunding part. The majority of the tests result in a difference at a significance level of 1%. But if we focus on the crowdfunding factors the total amount requested and
entrepreneur, they result in a similar ranking in comparison to the factor explanation about the charity (1) and (2).
4.2.3 Reward
There is no significant difference in ranking of the crowdfunding factors amount(4) and
decision(2). This justifies the conclusion that the ranking of the reward is the same for both
factors by crowdfunding financers. All donors valued the reward the same and they have a similar distribution.
The charitable givers ranked the factor reward (1) and (2 )much lower with a mean of 2,2 instead of the mean of 3,2 of the factor decision(2) by crowdfunding financers.
Apparently, in this case the donors value the reward (1) and (2) significantly different than factors amount(4) and decision(2) of the crowdfunding financers at a significance level of 1%. This seems self-evident; charitable givers who donate to a charity do not expect a reward, while crowdfunding is part of a different financing tool, where the investor could expect a reward.
4.2.4 Relation between the respondent and project performer.
There is a significant difference with a 10% significance level between crowdfunding financers and crowdfunding & donations financers in case of the relation between the respondent and project performer. There is also a significant difference in case of the
crowdfunding & donations – and donations group, but in this case there is a significant
difference at a 1% significance level. The crowdfunding & donations ranked the relation between the respondent and project performer the lowest. There is no significant difference between the only donations and crowdfunding financers, which mean that these respondents valued the relation in a comparable way.
Table 9: Motivational factors.
The total amount requested
Crowdfunding CF & Don Donations
Amount(1) Decision(1) Amount(2) Amount(3)
Mean 3,097619 2,984615 3,080386 3,15371
St.
Dev. 1,229119 1,135892 1,392364 1,369469
The explanation about the project/charity
Crowdfunding CF & Don Donations
The total amount
requested Project Goals Entrepreneur
Earlier projects Financial planning Risk Explanation charity(1) Explanation charity(2) Mean 4,020513 4,290909 4,264935 3,953247 3,212987 3,412987 3,166234 4,048232 3,915194 St. Dev. 1,063336 0,9233913 0,9478273 1,057166 1,327332 1,160701 1,257644 1,113374 1,229382 The reward
Crowdfunding CF & Don Donations
Amount(4) Decision(2) Reward(1) Reward(2)
Mean 3,27619 3,221951 2,202572 2,226148
St.
Dev. 1,367856 1,354881 1,353893 1,36132
Relation between the respondent and project performer
Crowdfunding CF & Don Donations
Relation(1) Relation(2) Relation(3)
Mean 2,860976 2,646302 3,007067
St.
Table 10: T-test motivational factors. The t-test ***,**,* indicate statistical significance at 1%, 5% and 10% level, respectively. The total amount requested
Crowdfunding CF & Don Donations
Amount(1) Decision(1) Amount(2) Amount(3)
Crowdfunding Amount(1) 0,1755 0,8595 0,5068
Decision(1) 0,3163 0,0449**
CF & Don Amount(2) 0,451
Donations Amount(3)
The explanation about the project/charity
Crowdfunding CF & Don Donations The total amount
requested Project Goals Entrepreneur
Earlier projects Financial planning Risk Explanation charity(1) Explanation charity(2) Crowdfunding The total amount requested 0,0002*** 0,0008*** 0,3775 0*** 0*** 0*** 0,7371 0,1697 Project 0,4641 0*** 0*** 0*** 0*** 0,0017*** 0*** Goals 0*** 0*** 0*** 0*** 0,0057*** 0*** Entrepreneur 0*** 0*** 0*** 0,2502 0,6204 Earlier projects 0,0031*** 0,5257 0*** 0*** Financial planning 0*** 0*** 0*** Risk 0*** 0***
CF & Don Explanation
charity(1) 0,1135
Donations Explanation charity(2)
The reward
Crowdfunding CF & Don Donations
Amount(4) Decision(2) Reward(1) Reward(2)
Crowdfunding Amount(4) 0,5662 0*** 0***
Decision(2) 0*** 0***
CF & Don Reward(1) 0,8059
Donations Reward(2)
Relation between the respondent and project performer
Crowdfunding CF & Don Donations
Relation(1) Relation(2) Relation(3)
Crowdfunding Relation(1) 0,0615* 0,1557 CF & Don Relation(2) 0,0016***
4.3. Robustness check
The changing of the scale from one to five to a scale from one to three leads to almost similar results in the independent t-tests. However, there are two exceptions in case of the total amount requested and the relation between the respondent and project performer. These are summarized in appendix 4. The changing effects in the total amount requested and the relation between the respondent and project performer are explained further in the following sections.
4.3.1 Total amount requested adjusted
Changing the scale of ordinal rank from one to three instead of the scale of one to five leads to a significant difference with a 10% significance level instead of a 5% significance level in the case of the crowdfunding factor decision and the donation factor amount earlier.
4.3.2 Relation between the respondent and project performer
In this case there is no significant difference between the crowdfunding and crowdfunding &
donations, while there is a significant difference at a 10% significance level in case of the
rank comparison of means between crowdfunding and donations. The difference in distribution of the factor relation between the respondent and project performer between
crowdfunding & donations and donations did not change in a 1% significance level.
5. Conclusion
This thesis studies the characteristics of the crowdfunding financers and charitable givers. This section summarizes conclusions of the literature review, and the analysis of the original data and the data used in this thesis.
5.1 Literature review
The literature review concludes the following giving profiles of charitable givers in general and the giving profile of crowdfunding financers. The general giving profiles of charitable givers are: households with a high altruism value, high confidence in charities, high social pressure combined with frequent requests of giving by charities; individuals who are born before 1941 with a high education diploma of HBO/WO give more and higher donations. The specific profile of a crowdfunding financer is a white and higher educated individual with a high speed Internet connection. Although the characteristics of the crowdfunding financers
have not been briefly analyzed in terms of the characteristics of the traditional donors yet, I expected similarities in the factors that can play a role in the decision-making process of giving a financial contribution between the crowdfunding – and donor group.
5.2 Database
I used the data of “Nationaal Crowdfunding Onderzoek 2013” by van den Akker et al. (2013) for this thesis. Van den Akker et al. (2013) obtained their data by an Internet survey, where overall social media pages approached the respondents. This selection of Internet respondents do not reflect the Dutch population at large, which causes bias if someone reflects the results on the total Dutch population. The sample selection bias may not be harmful for this thesis, because this thesis wants to evaluate similarities on differences between the factors that could play a role in the decision-making process related to a financial contribution of a specific population of contributors: the crowdfunding – and donor group, which is only relevant in case of a large feedback of crowdfunding financers.
The demographic characteristic age of this data differ from the giving profile of the donors in the literature review mentioned by Schuyt et al. (2013). Approximately 80% of the respondents have an age between 25 and 54 years, which do not reflect the highest group charitable givers born before 1941 of the results of donors of Schuyt et al. (2013).
The motivational factors that are mentioned in the crowdfunding – as well in the donation part of the survey were the total amount requested, explanation about the
project/charity, reward, website and relation between the respondent and project performer.
These five factors were tested in the results.
5.3 Summary of analysis
In this thesis I found the following results in the demographic characteristics between the four groups; crowdfunding, crowdfunding & donations, donations and non-financing.
The demographic characteristics showed an overall minority of females between the different groups. The crowdfunding financers showed the largest minority of females, this gender distribution also differed significantly with the gender distribution of other groups. The four groups showed a completely different distribution in age. All groups had 10% significance level or less. However, you can see that the average age in the crowdfunding &
donations – and donations group are higher than the average age in crowdfunding and none.
The minority of the respondents have a HBO or WO diploma in all groups, which is similar to the high education of charitable givers and crowdfunding financers mentioned in
the literature review. In contrast to the similarity in the minority of high education between the groups, there is still a significant difference between crowdfunding & donations with
donations and none.
The crowdfunding financers spent the most hours on social media pages in contrast to the other groups. This is in line with the expectation that crowdfunding financers will spend more hours on the internet and the crowdfunding profile with a high speed internet connection in the literature review. However, the crowdfunding group showed only a significant
difference with the donation group. Another significant difference is showed between the
crowdfunding & donations with donations and none. The top three of social media accounts
were the same in every group, where Linkedin is the most popular social media page in this thesis.
The motivational factors tested the significant differences in the decision-making process of the groups; crowdfunding & donations, donations and all crowdfunding financers. One remark is needed here; part 2 was not divided into separate crowdfunding financers and
crowdfunding & donations financers, whereas part 3 of the survey did separate the different
donation respondents in crowdfunding & donation – and donation financers.
The significant differences were tested with the independent t-test. The total amount requested was tested twice in part 2 of the survey. The decision factor of the total amount requested had a significant difference with the donation group with a 5% significance level. The difference decreased to 10% significance level when I checked for the robustness. The
explanation/information factor was ranked seven times in the crowdfunding part, but each
explanation provided different information in the question of the survey. Not all the
explanation of the crowdfunding part was the same as the donation part; for this reason there were a lot of significant differences in the results. Although the explanation about the amount money requested and the information about the entrepreneur of the project in the
crowdfunding part is approximately ranked the same way as the explanation about the charity in the donation part.
There is a significant difference in the ranking factor reward; charitable givers who donate to a charity do not expect a reward, while crowdfunding is part of a different financing tool, where the investor could expect a reward. The fact that crowdfunding is not only a donation tool could explain the difference in ranking the reward. The website showed
significant difference between all groups. The relation between the respondent and performer shows only a similarity between the crowdfunding financers and only donation group.
There is not enough statistic evidence to conclude that the factors that can play a role in the decision-making process to give a financial contribution are the same between the crowdfunding financers and charitable givers. However, when we look at the ranking of the factors by crowdfunding financers and donors, we find similar preferences in the factors that could play a role in the decision-process of a financial contribution. The explanation of the project/charity is valued the highest in all the three groups. The non-financers indicated that they have never contributed because they did not receive a request or could use their money better at this moment.
For next research it would be useful to have a survey with crowdfunding questions that indicate charity projects, instead of all possible crowdfunding projects. Charity projects will attract other people than reward-based projects.
This thesis helps charities who intend to use the new technology of crowdfunding. They need to focus on the characteristics of the group crowdfunding and donations. Charities should concentrate their activities on higher educated people (with a HBO diploma or higher) between 25 to 54 years. Charities should also pay extra attention to heavy users of internet and social media pages. It is important for charities to pay attention to the quality of -, the available information - and the passion of the individual behind the project. Frequent, repeated approaches, especially by people in the inner-circle or by well-known individuals, will raise the results. These main characteristics of people reflect a younger generation than the traditional contributors. In the traditional contribution dominates the face-to-face method as an instrument.
The male bias of the respondents in this survey is confusing; there has been a majority of males throughout every group; especially crowdfunders in the survey was male-dominated. The results do not indicate that charities should focus on males primarily, but a certain focus in the approach could lead to different results.
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Appendices
Appendix 1
Appendix 2
