Crowdfunding Herding During the Post-goal Stage

Abstract

Rewards-based crowdfunding has garnered significant attention in IS research, with a focus on backer behaviors leading up to a project's funding goal. However, little attention has been given to backers' motivations for overfunding a project. This study aims to address this gap by examining potential backers’ herd behavior after a project reaches its funding goal. By analyzing data from 5,445 projects on Kickstarter, we discover that herd behavior occurs not only before the goal is achieved but also after. Additionally, we explore the dynamics of herding and find that, in the post-goal stage, the combination of funding magnitude and time elapsed influences changes in herding. Specifically, funding magnitude significantly enhances herding as a project timeline progresses from the midpoint to the deadline. This interaction effect adds to the extensive body of research on the goal-gradient effect and the deadline effect, shedding light on their interplay in the post-goal stage.