Smile: Click! Here is Your Money! The Effect of Non-verbal Cues on Crowdfunding Success

Crowdfunding has been increasingly used by entrepreneurs to raise funds for their creative ideas. Although crowdfunding provides a platform for an easy access to more potential investors, entrepreneurs face more challenges in alleviating investors’ information asymmetry and moral hazards concerns. In this paper, we investigate how an entrepreneur could craft an effective pitch video to increase the funding success and attract more investors. Employing social presence theory and signaling theory, we propose that non-verbal cues in a pitch video, including dynamic, static and paralinguistic cues, affect financing outcomes. We collected data from 209 crowdfunding projects and tested our hypotheses. Our results show that an entrepreneur could improve the funding outcomes by smiling frequently, gazing less, appearing early, reducing pauses, and wearing informal attire in a funding video. Furthermore, the effect of smiling shows more salience for the technology projects. The implications for theory and crowdfun...