In equity crowdfunding (ECF), early investments serve as signals of venture potential to prospective investors, making them more likely to join an offering. We argue that ECF platform team members can exploit this mechanism and convey false signals to unsophisticated investors. Data from a prominent ECF platform indicate that platform team members “invest” in ventures that exhibit weaker post-campaign outcomes. However, in ventures that successfully fundraise, platform team members typically withdraw their investment (after it incentivized others to join), and these ventures show even weaker post-campaign outcomes. Finally, ventures' post-campaign outcomes are particularly weak when this “invest-and-withdraw” tactic is executed by the platform's upper echelons, whose investments can further be perceived as endorsement signals by the crowd, despite significant goal incongruence between the upper echelons and the crowd. Our study presents novel theoretical and empirical insights into the signaling, financial misconduct, and ECF literature, and holds important policy implications.

中文翻译：

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平台团队成员的虚假信号和活动后风险投资结果：来自股权众筹平台的证据


在股权众筹 （ECF） 中，早期投资是潜在投资者的风险潜力信号，使他们更有可能参与发行。我们认为 ECF 平台团队成员可以利用这种机制并向不成熟的投资者传达虚假信号。来自一个著名 ECF 平台的数据表明，平台团队成员 “投资 ”于活动后结果较弱的企业。然而，在成功筹集资金的企业中，平台团队成员通常会撤回他们的投资（在激励其他人加入之后），而这些企业在活动后的结果甚至更弱。最后，当这种 “投资和撤退 ”的策略由平台的上层执行时，风险投资的后活动结果尤其薄弱，尽管上层和人群之间存在明显的目标不一致，但他们的投资可以进一步被视为人群的认可信号。我们的研究对信号、财务不当行为和 ECF 文献提出了新颖的理论和实证见解，并具有重要的政策意义。