Invest or regret? An empirical investigation into funding dynamics during the final days of equity crowdfunding campaigns

Thang Nguyen, Joe Cox, Judy Rich

Research output: Contribution to journalArticlepeer-review

3 Citations (Scopus)
1 Downloads (Pure)


In this study, we use the options theory of investment to investigate the funding behaviour of investors in equity crowdfunding. Options theory argues that when faced with uncertainty, investors have the ‘option’ to delay their irreversible investments, although incur a cost in doing so. Demonstrating that investments in equity crowdfunding are characterised by low levels of irreversibility (i.e., they are semi-reversible), moderate costs of delay and high levels of uncertainty, we follow the predictions of options theory in hypothesising that investors may rationally delay their investments in order to gain new information about the quality of businesses in which they invest. We find empirical evidence in support of these arguments when investigating the dynamics of investment activity in campaigns hosted on the UK equity crowdfunding platform Crowdcube.
Original languageEnglish
Pages (from-to)784-803
Number of pages20
JournalJournal of Corporate Finance
Early online date24 Jul 2019
Publication statusPublished - 1 Oct 2019

Bibliographical note

NOTICE: this is the author’s version of a work that was accepted for publication in Journal of Corporate Finance. Changes resulting from the publishing process, such as peer review, editing, corrections, structural formatting, and other quality control mechanisms may not be reflected in this document. Changes may have been made to this work since it was submitted for publication. A definitive version was subsequently published in Journal of Corporate Finance, 58, (2019) DOI: 10.1016/j.jcorpfin.2019.07.011

© 2019, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International


  • Cost of delay
  • Equity crowdfunding
  • Options theory
  • Uncertainty

ASJC Scopus subject areas

  • Business and International Management
  • Finance
  • Economics and Econometrics
  • Strategy and Management

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