Investment crowdfunding attracts a more diverse range of investors and entrepeneurs. Women feel at home in the crowd, far more than the old-school male-dominated VC communities which used to be the way to raise fund.
The study is called "The Narrative Advantage: Gender and the Language of Crowdfunding”. It examines women's skills as storytellers, and the importance of being able to tell a story that makes sense to potential investors and resonates with them emotionally.
“Online fundraising settings pose an interesting empirical puzzle: women are systematically more successful than men, an outcome contrary to offline gender inequality,” write professors Andreea Gorbatai and Laura Nelson . "We propose that this outcome is partially explained by linguistic differences between men and women."
The professors tested their theories by looking at almost 9,000 small business and technology fundraising campaigns on the crowdfunding website Indiegogo.
It turns out that the quality of the story makes a big difference when business owners arfe raising funding. Women are culturally, good at talking, good at listeniing, and good at spotting nonsense. (Plenty of us had worked that out for ourselves, of course; what is interesting about this research is that it reveals how important narrative is to investment decision-mkaing, and why and how women can be good at it.
"Results support our theory, suggesting a link between micro-level linguistic choices and macro level outcomes: the institution of crowdfunding may reduce gender inequalities in the fundraising arena by benefitting the communication style of women.”
We've placed a copy of the full report in our research library, where it's available to registered members of Another Crowd.