The Greenwashing Gambit: A Double‐Edged Sword in Crowdfunding Success

The paper examines when greenwashing becomes a success factor in reward‐based crowdfunding campaigns aimed at financing environmentally sustainable products. While prior work has identified what drives success in such campaigns, it remains unclear when misleading environmental claims are discounted as cheap talk and when they instead contribute to funding outcomes. Building on signaling theory, the study explores how costly quality signals interact with potentially deceptive environmental messages (greenwashing risk) and jointly may contribute to crowdfunding success. Additionally, the paper investigates whether the “wisdom of the crowd” can act as a mechanism to prevent greenwashing from becoming a success factor. Using fsQCA on 253 Kickstarter and Indiegogo campaigns (2009–2024), for which greenwashing risk was expert‐coded through the Terrachoice seven‐sins framework, we identify configurations associated with funding success. The findings reveal a double‐edged pattern. Greenwashing co‐occurs with funding success when embedded within a rich bundle of costly quality signals and when funding goals are modest; in ambitious campaigns, success co‐occurs with low greenwashing, and the combination of high goals, greenwashing, and absent quality signals constitutes a highly consistent path to failure. An exploratory analysis of high‐participation campaigns further suggests that the “wisdom of the crowd” may not reliably penalize greenwashing when other credible signals are present. Overall, the study contributes to signaling theory by specifying the configurations under which potentially deceptive environmental claims gain or lose traction, rather than treating them as uniformly effective or inert. For practice, it offers crowdfunding platforms an observable screening rule: Campaigns that pair ambitious goals and dense environmental claims with weak quality signals form a high‐risk configuration that warrants targeted review before launch.