Experimental DecisionMaking Approach Attracts Funding

Experimental DecisionMaking Approach Attracts Funding


When you are an early-stage entrepreneur, you should inform potential resource providers that you used an experimentation-based approach to decision-making. They may be more inclined to invest in your business. This is the preliminary result of an ongoing study by Chiara Spina, PhD Candidate at the Department of Management and Technology and Charles Williams, strategy scholar at Bocconi University. A growing number of entrepreneurs engage in experimentation activities in early-stage projects. Even though existing literature has focused on the benefits of this approach, the reaction of investors to the description of experimental activities has been overlooked. To investigate this issue, the authors performed text analysis on the descriptions of 54,377 projects launched and concluded on Kickstarter from March 2016 to February 2017. “We created a dictionary of words that signal experimental activities (experimental approach) or of the careful planning of each step of the process (planning approach) or none of the above,” Chiara Spina says.

After accounting for the effect of a number of other variables (credentials, goal amount, length of funding period, number of Facebook friends, etc), they found that entrepreneurs that describe experimental activities are 41% more likely to achieve their funding goal than those who do not describe activities related to create their product/service. Entrepreneurs who described planning-related activities are also more likely to achieve funding than those who do not describe activities, but to a lesser extent (27% increase in likelihood). The effect is stronger for entrepreneurs at their first or second project.

Read more about this topic:
Nicolai Foss. Entrepreneurship Goes beyond Startups
Carlo Mammola and Luigi Mastromauro. Predicting Startup Success with Data
Good Business Plan not Enough for Success. Interview to Alisée de Tonnac
Creating an Identikit of Entrepreneurs from 1850 to Present
Grow Your Business but Minimize the Risks
The Key Role of Taxation Regimes for Startups
A Small Fee for Business Training Improves Course Attendance
Family Ownership Helps Cope with Political Uncertainty
Entrepreneurs Who Act Like Scientists Get Better Results
Avocado Toast Leads to Hot Brooklyn Startup. Interview to Alessandro Biggi
Turning “Spotify for Textbooks” into $4.8 mln. Interview to Perlego
Looking at Gender Bias in Funding Yields a Surprise Result
Family Firm Governance Results Linked to Context
Social Networks Foster Entrepreneurship
Taking Texting to the Next Level with Kaleyra. Interview to Dario Calogero
Connecting the Dots on How WWI Unleashed new Business Performance

by Claudio Todesco


All News
  • MINTS, a New Research Unit on Monetary Innovation

    The research unit and an observatory will be launched on Wednesday 18 December, with the conference The Future of Money, which will analyze the implications of innovation on central banks and their monetary policies  

  • OASI Report: Italy's NHS in Identity Crisis amid an Expanding Healthcare System

    According to SDA Bocconi's CERGAS scholars, there is an urgent need to redefine the mission of the National Health Service, which has reached substantial financial stability (e149 million deficit out of e119 billion expenditures, equal to 0.1%), but is growing less than privately funded services. With a study of the career hurdles women face  


  January 2020  
Mon Tue Wed Thu Fri Sat Sun
    1 2 3 4 5
6 7 8 9 10 11 12
13 14 15 16 17 18 19
20 21 22 23 24 25 26
27 28 29 30 31    


All Seminars
  • Causality: A Decision Theoretic Foundation

    Pablo Schenone (Visiting professor, Caltech)

    Seminar Room 3.e4.sr03 - Via Roentgen 1

  • Mechanism Design with Limited Commitment

    Laura Doval (Assistant Professor, Caltech) 

    Seminar Room 3.e4.sr03 - Via Roentgen 1