This study examines the impact of matchfunding from public and/or private funders on the success of online crowdfunding campaigns. We explore the signaling effects and crowding-in potential of institutional funding in the cultural and creative industries.
Study Design
Using a unique dataset of 2,032 arts-related projects from a Dutch crowdfunding platform, we employ stepwise multilinear regression analyses, including moderation and mediation models, to test our hypotheses.
Findings
Matchfunding significantly increases the total funding raised and ensures campaign success. Contributions from public partners and early-stage funding demonstrate stronger positive effects compared to private partners and later contributions. While matchfunding may not increase the number of backers, it boosts the average donation size.
Contributions
This study advances the literature on alternative finance and cultural funding by providing empirical evidence on the effectiveness of matchfunding via crowdfunding platforms. We introduce new independent variables related to institutional funding, addressing a gap in the context of alternative financing.
Implications
Demonstrating that ‘matchfunding matters’ can encourage institutional partners, campaigners, platforms, and backers to leverage online matchfunding. It offers a cost-effective method of pooling resources to support arts, culture, and creativity through crowdfunding platforms.
AgrawalA.CataliniC.GoldfarbA. (2015). Crowdfunding: Geography, social networks, and the timing of investment decisions. Journal of Economics and Management Strategy, 24(2), 253–274. https://doi.org/10.1111/jems.12093
2.
AgrawalA. K.CataliniC.GoldfarbA. (2014). Some simple economics of crowdfunding. Innovation Policy and the Economy, 14(1), 63–97. https://doi.org/10.1086/674021
3.
AlexiouK.WigginsJ.PreeceS. B. (2020). Crowdfunding acts as a funding substitute and a legitimating signal for nonprofit performing arts organizations. Nonprofit and Voluntary Sector Quarterly, 49(4), 827–848. https://doi.org/10.1177/0899764020908338
4.
AndreoniJ. (1989). Giving with impure altruism: Applications to charity and Ricardian equivalence. Journal of Political Economy, 97(6), 1447–1458. https://doi.org/10.1086/261662
5.
AndreoniJ. (1990). Impure altruism and donations to public goods: A theory of warm-glow giving. The Economic Journal, 100(401), 464–477. https://doi.org/10.2307/2234133
6.
AndreoniJ. (1993). An experimental test of the public-goods crowding-out hypothesis. The American Economic Review, 83(5), 1317–1327.
BanerjeeS.BoseI. (2022). An attractive proposition? Persuading retail consumers to prefer reward-based crowdfunding for owning upcoming technologies. Information & Management, 59(6), 103663. https://doi.org/10.1016/j.im.2022.103663
9.
BapnaS.BurtchG. (2024). An Experimental Evaluation of Gender Differences in Responses to Major-Donor Funding Schemes for Crowdfunded Social Ventures. Information Systems Research. https://doi.org/10.2139/ssrn.3938577
10.
BargoniA.FerrarisA.BrescianiS.CamilleriM. A. (2022). Crowdfunding and innovation: A bibliometric review and future research agenda. European Journal of Innovation Management, 27(4), 1109–1133. https://doi.org/10.1108/ejim-06-2022-0310
11.
BaumolW. J. (1991). Performing arts. In EatwellJ.MilgateM.NewmanP. (Eds.), The world of economics. The new Palgrave. Palgrave Macmillan.
BoeufB.DarveauJ.LegouxR. (2014). Financing creativity: Crowdfunding as a new approach for theatre projects. International Journal of Arts Management, 16(3), 33–48.
14.
BonetL.DonatoF. (2011). The financial crisis and its impact on the current models of governance and management of the cultural sector in Europe. European Journal of Cultural Management and Policy, 1(1), 4–11. https://doi.org/10.3389/ejcmp.2023.v1iss1-article-1
BretschneiderU.KnaubK.WieckE. (2014). Motivations for crowdfunding: What drives the crowd to invest in start-ups? In AISeL proceedings. AIS. https://aisel.aisnet.org/ecis2014/proceedings/track05/6/ (accessed 12 December 2020).
17.
BreznitzS.NoonanD. (2020). Crowdfunding in a not-so-flat world. Journal of Economic Geography, 20(4), 1069–1092. https://doi.org/10.1093/jeg/lbaa008
BürgerT.KleinertS. (2020). Crowdfunding cultural and commercial entrepreneurs: An empirical study on motivation in distinct backer communities. Small Business Economics, 57(2), 667–683. https://doi.org/10.1007/s11187-020-00419-8
20.
CavesR. (2000). Creative industries: Contracts between art and commerce. Harvard University Press.
21.
ChanD.LoW. (2007). Running universities as enterprises: University governance changes in Hong Kong. Asia Pacific Journal of Education, 27(3), 305–322. https://doi.org/10.1080/02188790701591543
22.
ChanJ.HuangZ.LiuD.CaiZ. (2023). Better to give than to receive: Impact of adding a donation scheme to reward-based crowdfunding campaigns. Information Systems Research, 35(1), 272–293. https://doi.org/10.1287/isre.2023.1224
23.
CobbN. K. (2002). The new philanthropy: Its impact on funding arts and culture. The Journal of Arts Management, Law, and Society, 32(2), 125–143. https://doi.org/10.1080/10632920209596969
24.
ColomboM. G.FranzoniC.Rossi‐LamastraC. (2015). Internal social capital and the attraction of early contributions in crowdfunding. Entrepreneurship Theory and Practice, 39(1), 75–100. https://doi.org/10.1111/etap.12118
25.
CourtneyC.DuttaS.LiY. (2016). Resolving information asymmetry: Signalling, endorsement, and crowdfunding success. Entrepreneurship Theory and Practice, 41(2), 265–290. https://doi.org/10.1111/etap.12267
26.
CrosettoP.RegnerT. (2018). It’s never too late: Funding dynamics and self pledges in reward-based crowdfunding. Research Policy, 47(8), 1463–1477. https://doi.org/10.1016/j.respol.2018.04.020
27.
CummingD.HornufL. (2018). The economics of crowdfunding: Startups, portals and investor behavior. Palgrave Macmillan.
28.
Dalla ChiesaC.AlexopoulouA. (2022). Matchfunding goes digital: The benefits of matching policymaking with the crowd’s wisdom. European Journal of Cultural Management and Policy, 12, 11090. https://doi.org/10.3389/ejcmp.2022.11090
29.
Dalla ChiesaC.DekkerE. (2021). Crowdfunding artists: Beyond matchmaking on platforms. Socio-Economic Review, 19(4), 1265–1290. https://doi.org/10.1093/ser/mwab006
30.
Dalla ChiesaC.HandkeC. (2020). Crowdfunding. In TowseR.NavaretteT. (Eds.), A handbook of cultural economics (3rd ed., pp. 158–167). Edward Elgar.
31.
Dalla ChiesaC.PavlovaA.LavangaM.PysanaN. (2024). When fashion meets crowdfunding: Exploring sustainable and innovative features of online campaigns. Journal of Fashion Marketing and Management: International Journal, 28(4), 688–708. https://doi.org/10.1108/jfmm-03-2021-0068
EckelC. C.GrossmanP. J. (2006). Subsidizing charitable giving with rebates or matching: Further laboratory evidence. Southern Economic Journal, 72(4), 794–807. https://doi.org/10.1002/j.2325-8012.2006.tb00738.x
36.
ElkinsM.FryT. R. (2022). Beyond the realm of cash: Street performers and payments in the online world. Journal of Cultural Economics, 46(2), 231–248. https://doi.org/10.1007/s10824-021-09421-8
37.
FangZ.TanX. J.XiaoS.TanY. (2021). More than double your impact: An empirical study of match offers on charitable crowdfunding platforms. In Kelley school of business research paper (36). SSRN.
38.
FederT. (2017). Intentions and consequences of arts funding: Arts policy and arts consumption. Doctoral dissertation. University of Haifa. (Israel).
39.
FederT.Katz-GerroT. (2015). The cultural hierarchy in funding: Government funding of the performing arts based on ethnic and geographic distinctions. Poetics, 49, 76–95. https://doi.org/10.1016/j.poetic.2015.02.004
40.
FieldA. (2013). Discovering statistics using IBM SPSS statistics. Sage.
41.
FreyB. (2000). Arts & economics: Analysis & cultural policy. Springer.
42.
GerberE.HuiJ. (2016). Crowdfunding: How and why people participate. In MéricJ.MaqueI.BrabetJ. (Eds.), International perspectives on crowdfunding: Positive, normative and critical theory. Emerald Insight.
43.
GueriniM.QuasA. (2016). Governmental venture capital in Europe: Screening and certification. Journal of Business Venturing, 31(2), 175–195. https://doi.org/10.1016/j.jbusvent.2015.10.001
44.
GuimarãesA. D.MaehleN. (2023). Evolution, trends, and narratives of cultural crowdfunding: The case of Norway. International Journal of Cultural Policy, 29(7), 942–970. https://doi.org/10.1080/10286632.2022.2152446
45.
GuimarãesA. D.MaehleN.BonetL. (2024). The relational forms of cultural-creative crowdfunding: A typology of practices through mapping platforms in Europe and Latin America. Poetics, 105, 101913. https://doi.org/10.1016/j.poetic.2024.101913
46.
HandkeC.Dalla ChiesaC. (2022). The art of crowdfunding arts and innovation: The cultural economic perspective. Journal of Cultural Economics, 46(2), 285. https://doi.org/10.1007/s10824-022-09444-9
47.
HarrellF. E. (2015). Regression modeling strategies: With applications to linear models, logistic and ordinal regression, and survival analysis. Springer.
48.
HobbsJ.GrigoreG.MolesworthM. (2016). Success in the management of crowdfunding projects in the creative industries. Internet Research, 26(1), 146–166. https://doi.org/10.1108/IntR-08-2014-0202
49.
HoggR. V.MckeanJ. W.CraigA. T. (2019). Mathematical statistics (3rd ed.). Pearson.
50.
HörischJ.TennerI. (2020). How environmental and social orientations influence the funding success of investment-based crowdfunding: The mediating role of the number of funders and the average funding amount. Technological Forecasting and Social Change, 161, 120311.
51.
HudikM.ChovankuliakR. (2018). Private provision of public goods via crowdfunding. Journal of Institutional Economics, 14(1), 23–44. https://doi.org/10.1017/s1744137417000169
52.
IslamM.FremethA.MarcusA. (2018). Signalling by early stage startups: US government research grants and venture capital funding. Journal of Business Venturing, 33(1), 35–51. https://doi.org/10.1016/j.jbusvent.2017.10.001
53.
KangL.JiangQ.TanC. H. (2017). Remarkable advocates: An investigation of geographic distance and social capital for crowdfunding. Information & Management, 54(3), 336–348. https://doi.org/10.1016/j.im.2016.09.001
54.
KarlanD.ListJ. A. (2007). Does price matter in charitable giving? Evidence from a large-scale natural field experiment. The American Economic Review, 97(5), 1774–1793. https://doi.org/10.1257/aer.97.5.1774
55.
KimK.HannI. (2019). Crowdfunding and the democratization of access to capital—an illusion? Evidence from housing prices. Information Systems Research, 30(1), 276–290. https://doi.org/10.1287/isre.2018.0802
56.
KleinertS.VolkmannC.GrünhagenM. (2020). Third-party signals in equity crowdfunding: the role of prior financing. Small Business Economics, 54(1), 341–365. https://doi.org/10.1007/s11187-018-0125-2
57.
Koschate-FischerN.StefanI. V.HoyerW. D. (2012). Willingness to pay for cause-related marketing: The impact of donation amount and moderating effects. Journal of Marketing Research, 49(6), 910–927. https://doi.org/10.1509/jmr.10.0511
58.
KretschmerM.KlimisG. M.ChoiC. J. (1999). Increasing returns and social contagion in cultural industries. British Journal of Management, 10(s1), 61–72. https://doi.org/10.1111/1467-8551.10.s1.6
LiangT. P.WuS. P. J.HuangC. C. (2019). Why funders invest in crowdfunding projects: Role of trust from the dual-process perspective. Information & Management, 56(1), 70–84. https://doi.org/10.1016/j.im.2018.07.002
61.
LiuZ.GaoQ.RaoR. S. (2024). Self-donations and charitable contributions in online crowdfunding: An empirical analysis. Journal of Marketing, 89(1), 117–134. https://doi.org/10.1177/00222429241260687
62.
LootsE. (2015). The income standard for the performing and visual arts in The Netherlands: A simple indicator of financial performance or a transition to another mode of supporting non-profit organizations?Zeitschrift für Kulturmanagement, 1(1), 53–74. https://doi.org/10.14361/zkmm-2015-0105
63.
LootsE. (2019). Strings attached to arts funding: Panel assessments of theater organizations through the lens of agency theory. The Journal of Arts Management, Law, and Society, 49(4), 274–290. https://doi.org/10.1080/10632921.2019.1617812
64.
LootsE.BetzlerD.BilleT.BorowieckiK. J.LeeB. (2022). New forms of finance and funding in the cultural and creative industries. Introduction to the special issue. Journal of Cultural Economics, 46(2), 205–230. https://doi.org/10.1007/s10824-022-09450-x
65.
LootsE.PiecykK.WijngaardenY. (2024). At the juncture of funding, policy, and technology: How promising is matchfunding of arts and culture through crowdfunding platforms?International Journal of Cultural Policy, 30(1), 118–134. https://doi.org/10.1080/10286632.2023.2173746
66.
ManningS.BejaranoT. A. (2017). Convincing the crowd: Entrepreneurial storytelling in crowdfunding campaigns. Strategic Organization, 15(2), 194–219. https://doi.org/10.1177/1476127016648500
67.
MavlanovaT.Benbunan-FichR.LangG. (2016). The role of external and internal signals in E-commerce. Decision Support Systems, 87, 59–68. https://doi.org/10.1016/j.dss.2016.04.009
68.
MeierS. (2007). Do subsidies increase charitable giving in the long run? Matching donations in a field experiment. Journal of the European Economic Association, 5(6), 1203–1222. https://doi.org/10.1162/jeea.2007.5.6.1203
69.
MejiaJ.UrreaG.Pedraza-MartinezA. J. (2019). Operational transparency on crowdfunding platforms: Effect on donations for emergency response. Production and Operations Management, 28(7), 1773–1791.
70.
Mendes-da-SilvaW.RossoniL.ConteB.GattazC.FranciscoE. (2016). The impacts of fundraising periods and geographic distance on financing music production via crowdfunding in Brazil. Journal of Cultural Economics, 40(1), 75–99. https://doi.org/10.1007/s10824-015-9248-3
MollickE.NandaR. (2016). Wisdom or madness? Comparing crowds with expert evaluation. Management Science, 62(6), 1533–1553. https://doi.org/10.1287/mnsc.2015.2207
73.
MollickE.RobbA. (2016). Democratizing innovation and capital access: The role of crowdfunding. California Management Review, 58(2), 72–87. https://doi.org/10.1525/cmr.2016.58.2.72
74.
MontgomeryD. C.RungerG. C. (2014). Applied statistics and probability for engineers (6th ed.). John Wiley & Sons.
75.
OrdaniniA.MiceliL.PizzettiM.ParasuramanA. (2011). Crowd-funding: Transforming customers into investors through innovative service platforms. Journal of Service Management, 22(4), 443–470. https://doi.org/10.1108/09564231111155079
76.
PottsJ.CunninghamS.HartleyJ.HartleyJ. (2008). Social network markets: A new definition of the creative industries. Journal of Cultural Economics, 32(3), 167–185. https://doi.org/10.1007/s10824-008-9066-y
77.
R Core Team. (2013). R: A language and environment for statistical computing. R Foundation for Statistical Computing. https://www.r-project.org/ (accessed 1 September 2020).
78.
RöthlerD.WenzlaffK. (2011). Crowdfunding schemes in Europe. EENC report, 9, 2011.
RykkjaA.BonetL. A. (2023). Government matching of cultural crowdfunding: An exploratory comparative analysis of the Spanish and Swedish cases. Debats. Revista de Cultura, Poder i Societat(8), 249–273.
81.
RykkjaA.MunimZ. H.BonetL. (2020). Varieties of cultural crowdfunding: The relationship between cultural production types and platform choice. Baltic Journal of Management, 15(2), 261–280. https://doi.org/10.1108/bjm-03-2019-0091
82.
RyuS. (2024). Media and entertainment industry management: How to integrate business and management with creativity and imagination (1st ed.). Routledge.
83.
RyuS. (2024b). Antecedents and consequences of relationship motivation in reward-based crowdfunding. Journal of Alternative Finance, 1(2), 173–193. https://doi.org/10.1177/27533743241259493
84.
RyuS.KimK.HahnJ. (2022). Crowdfunding success effects on financing outcomes for startups: A signalling theory perspective. MIS Quarterly, 47(3), 1271–1302. https://doi.org/10.25300/misq/2022/16620
85.
SchmidtzD. (1987). Contracts and public goods. Harvard Journal of Law & Public Policy, 10, 475–503.
SchusterJ. M. D. (1989). Government leverage of private support: Matching grants and the problem with new money. In WyszomirskiM. J.ClubbP. (Eds.), The cost of culture: Patterns and prospects of private arts patronage. ACA Books.
88.
SenabreE.MorellM. F. (2018). Match-funding as a formula for crowdfunding: A case study on the Goteo.Org platform. In Proceedings of 14th international symposium on open collaboration (pp. 1–5). Association for Computing Machinery. Article 23.
89.
SharpA. M.LiuY. C.MaiW. Y. C. C. (2014). Crowdfunding success factors. International Research Journal of Applied Finance, 7, 822–832.
90.
ShneorR.VikA. A. (2020). Crowdfunding success: A systematic literature review 2010–2017. Baltic Journal of Management, 15(2), 149–182. https://doi.org/10.1108/bjm-04-2019-0148
91.
ShneorR.ZhaoL.FlåtenB. T. (2020). Advances in crowdfunding: Research and practice. Springer Nature.
92.
ShneorR.ZhaoL.GoedeckeJ. F. M. (2023). On relationship types, their strength, and reward crowdfunding backer behavior. Journal of Business Research, 154, 113294.
93.
ShortJ. C.KetchenD. J.McKennyA. F.AllisonT. H.IrelandR. D. (2017). Research on crowdfunding: Reviewing the (very recent) past and celebrating the present. Entrepreneurship Theory and Practice, 41(2), 149–160. https://doi.org/10.1111/etap.12270
94.
SmithT. (2003). The effect of NEA grants on the contributions to nonprofit dance companies. The Journal of Arts Management, Law, and Society, 33(2), 98–113. https://doi.org/10.1080/10632920309596569
95.
SmithT. (2007). The impact of government funding on private contributions to nonprofit performing arts organizations. A. Annals of Public and Cooperative Economics, 78(1), 137–160. https://doi.org/10.1111/j.1467-8292.2007.00329.x
96.
SnedecorG. W.CochranW. G. (1989). Statistical Methods (8th Edition). Iowa State University Press.
97.
SolomonJ.MaW.WashR. (2015). Don't wait! How timing affects coordination of crowdfunding donations. In Proceedings of the 18th ACM conference on computer supported cooperative work & social computing (CSCW’15) (pp. 547–556). ACM.
98.
SpenceM. (2002). Signalling in retrospect and the informational structure of markets. The American Economic Review, 92(3), 434–459. https://doi.org/10.1257/00028280260136200
99.
StankoM. A.HenardD. H. (2016). How crowdfunding influences innovation. MIT Sloan Management Review, 57(3), 14–17.
100.
SteigenbergerN. (2017). Why supporters contribute to reward-based crowdfunding. International Journal of Entrepreneurial Behavior & Research, 23(2), 336–353. https://doi.org/10.1108/ijebr-04-2016-0117
101.
StevensonR.KierA. S.TaylorS. G. (2020). Do policy makers take grants for granted? The efficacy of public sponsorship for innovative entrepreneurship. Strategic Entrepreneurship Journal, 15(2), 231–253. https://doi.org/10.1002/sej.1376
TingleyD.YamamotoT.HiroseK.KeeleL.ImaiK. (2014). Mediation: R package for causal mediation analysis. Journal of Statistical Software, 59(5), 1–38. https://doi.org/10.18637/jss.v059.i05
106.
TukeyJ. W. (1977). Exploratory data analysis. Pearson.
107.
Van MontfortK.SiebersV.De GraafF. J. (2020). Civic crowdfunding in local governments: Variables for success in The Netherlands?Journal of Risk and Financial Management, 14(1), 8. https://doi.org/10.3390/jrfm14010008
108.
van TeunenbroekC.Dalla ChiesaC.HesseL. (2023). The contribution of crowdfunding for philanthropy: A systematic review and framework of donation and reward crowdfunding. Journal of Philanthropy and Marketing, 28(3), 2691. https://doi.org/10.1002/nvsm.1791
VismaraS. (2018). Signalling to overcome inefficiencies in crowdfunding markets. In CummingD.HornufL. (Eds.), The economics of crowdfunding (pp. 29–56). Palgrave Macmillan.
111.
WachsJ.VedresB. (2021). Does crowdfunding really foster innovation? Evidence from the board game industry. Technological Forecasting and Social Change, 168, 120747. https://doi.org/10.1016/j.techfore.2021.120747
112.
WaldfogelJ. (2017). How digitization has created a golden age of music, movies, books, and television. The Journal of Economic Perspectives, 31(3), 195–214. https://doi.org/10.1257/jep.31.3.195
113.
WesselM.AdamM.BenlianA. (2019). The impact of sold-out early birds on option selection in reward-based crowdfunding. Decision Support Systems, 117, 48–61. https://doi.org/10.1016/j.dss.2018.12.002
114.
ZhaoL.RyuS. (2020). Reward-based crowdfunding research and practice. In Advances in crowdfunding: Research and practice (pp. 119–143). Springer.
ZhengH.QiZ.LuoX.LiL.XuB. (2020). The value of backers’ word-of-mouth in crowdfunding projects filtering: An empirical investigation. Electronic Commerce Research, 20(4), 757–782. https://doi.org/10.1007/s10660-018-9322-y
117.
Zúñiga‐VicenteJ. Á.Alonso‐BorregoC.ForcadellF. J.GalánJ. I. (2014). Assessing the effect of public subsidies on firm R&D investment: A survey. Journal of Economic Surveys, 28(1), 36–67. https://doi.org/10.1111/j.1467-6419.2012.00738.x
