Investor Sentiment and Crowdfunding Success: Evidence From Kickstarter

This study examines how investor sentiment affects fundraising in reward‐based crowdfunding markets. Using Spotify‐based music sentiment as a proxy for investor sentiment, we show that positive sentiment increases both pledged amounts and the number of backers. These effects are strongest early in the campaign and are distinct from the influence of prior funding activity and peer participation. We further find that positive sentiment is associated with better eventual fundraising outcomes, with early‐stage funding performance helping to account for this relation. Our findings identify investor sentiment as an important driver of individual backing decisions and aggregate crowdfunding performance.