The Value of Completing Crowdfunding Projects
by: Rick Wash
Crowdfunding systems are social media websites that allow people to donate small amounts of money that add up to fund valuable larger projects. These websites are structured around projects: finite campaigns with well-defined goals, end dates, and completion criteria. We use a dataset from an existing crowdfunding website – the school charity Donors Choose – to understand the value of completing projects. We find that completing a project is an important act that leads to larger donations, greater likelihood of returning to donate again, and few projects that expire close but not complete. A conservative estimate suggests that this completion bias led to over $15 million in increased donations to Donors Choose, representing approximately 16% of the revenue for the period under study. This bias suggests that structuring many types of collaborative work as a series of projects might increase contribution significantly.
Rick Wash. “The Value of Completing Crowdfunding Projects” Proceedings of the International Conference on Weblogs and Social Media (ICWSM). Boston, MA. July 2013.