The Impact Of Projects' Uncertainty On The Performance Of Equity Crowdfunding

Equity crowdfunding provides new financing channels for individuals and small enterprises with creative ideas and entrepreneurial planning,alleviating the difficulty of financing for start-ups and individuals.It has the characteristics of inclusiveness and is a powerful complement to the capital market.However,equity crowdfunding also has the problem of information asymmetry like the traditional financing lending market,which has adversely affected the development of equity crowdfunding.Although project sponsors can alleviate this problem by releasing signals to potential investors,the uncertainty of the financier will affect the degree of trust of potential investors in the signal,affecting signal transmission and financing performance.Therefore,this paper has important theoretical and practical significance through empirical research on which signals can reduce the degree of information asymmetry of equity crowdfunding and the impact of pro ject uncertainty on signal transmission process and transmission effect.Based on the analysis of information asymmetry theory and signal theory,this paper puts forward six major signals affecting the performance of equity crowdfunding financing,namely project description signal,project scale signal,human capital signal,social interaction signal,and lead investor signal.With the uncertainty of the project,86 projects on the Jingdong Dongjia Equity Crowdfunding Platform were selected as sample data,the multiple regression models were constructed with the completion rate of financing and six major signals.The six major signals were used as independent variables,the completion rate of financing was used as dependent variables.Because the uncertainty of the project will affect the signal quality and transmission effect,this paper builds the uncertainty interaction effect model based on the previous model.Firstly,the results of empirical research show that the amount of investment in the project scale signal and the followings in the social interaction signal can promote the completion rate of financing,the investment ratio of the lead investor cannot play the role of the investment.The uncertainty has a negative impact on financing performance.Secondly,according to the level of uncertainty,this paper distinguishes the authenticity of human capital signals and project description signals.When the uncertainty of the project is high,the team size of the project and the education level of the project sponsors are true signals,and the pages of business plan is false signal.Thirdly,It shows that when the uncertainty is relatively high,the pages of business plan does not promote the financing performance,but reduces the financing performance.When the project uncertainty is low,the pages of business plan is a true signal,the team size and the education level of the project sponsors are false signals.Based on the results of empirical research,this paper proposes targeted recommendations for the promoters,platform parties and governments of equity crowdfunding projects.It has important reference value for how the financing parties disclose information and improve the operating mechanism of the platform.