Temporal actions under uncertainty in crowdfunding campaigns
Publication id: long-2021-crowdfunding-temporal-actions
Status: verified
Citation: Long, A. J., Shakya, S., Plemmons, A., & Stull, M. (2021). Is Time Really Money? Exploring the Temporal Actions Under Uncertainty in Crowdfunding Campaigns. Frontiers of Entrepreneurship Research. Download PDF
Facts¶
Policy hook¶
Entrepreneurs face uncertainty throughout the startup process, particularly during environmental shocks (pandemics, crises). A key question is how heightened uncertainty affects the timing and pace of entrepreneurial action—do entrepreneurs accelerate or delay decision-making? This paper examines whether uncertainty changes how entrepreneurs structure their crowdfunding campaigns.
Main finding¶
Under high uncertainty, entrepreneurs exhibit different temporal responses during pre-launch versus post-launch phases. They take slower action when preparing campaigns (lower pre-launch pace, β = -0.512, p < 0.05) but extend campaign duration after launch (higher post-launch initiation, β = 5.050, p < 0.05). However, these temporal shifts are counterproductive: a slower pre-launch pace has no significant effect on campaign success, while a longer post-launch duration significantly reduces pledge amounts (β = -2.461, p < 0.05). In contrast, faster post-launch updates (higher pace) significantly improve performance (β = 0.313, p < 0.05).
Data and setting¶
10,996 Kickstarter crowdfunding campaigns from January 2019 through August 2020, spanning pre-pandemic and COVID-19 periods. The dataset includes campaign characteristics (success rate, project type, location, backers, pledges, word count, pictures) and timestamps of creation, launch, funding, and conclusion. The study leverages the COVID-19 pandemic declaration (March 11, 2020) and state lockdown implementations as exogenous sources of environmental uncertainty.
Research design (plain language)¶
The paper uses difference-in-differences (DiD) regression to estimate how temporal characteristics change when environmental uncertainty increases. Treatment: post-March 2020 dummy and state-level lockdown implementation. Outcome variables include pre-launch initiation (time spent preparing), post-launch initiation (campaign duration), pre-launch pace (effort intensity), and post-launch pace (update frequency). A second stage uses two-stage least squares (2SLS) to test whether temporal characteristics causally affect campaign performance (pledge amount).
One caveat¶
The effects, while statistically significant, are modest in magnitude. The study captures only one pandemic shock and Kickstarter campaigns specifically, limiting generalizability to other funding contexts or uncertainty types. The temporal dynamics may not apply equally to all entrepreneurial ventures or non-crowdfunding contexts. Additionally, the paper cannot distinguish between rational adjustments and behavioral responses driven by emotion or cognitive biases under uncertainty.
PDF or DOI¶
Why it matters¶
Uncertainty is a defining feature of entrepreneurship, but most research treats timing decisions as fixed rather than adaptive. This paper reveals that entrepreneurs do change their behavior when facing external shocks—they slow down and take longer to launch campaigns. However, these adaptive responses are ineffective; they fail to improve outcomes and may actually harm them. The finding that faster post-launch engagement significantly improves performance suggests that continuous stakeholder communication matters more than pre-launch preparation under uncertainty. For entrepreneurs and platform designers, the implication is clear: when facing turbulent environments, focus resources on rapid iteration and backer engagement post-launch rather than delaying launches or slowing preparation. The work also highlights a gap between adaptive behavior and optimal strategy—entrepreneurs’ emotional or cognitive responses to uncertainty (fear, caution) do not align with what actually drives success. This suggests that targeted entrepreneurial training or platform interventions could help founders overcome counterproductive timing instincts during crises.