Crowdfunded and then? The role of intellectual capital in the growth of equity-crowdfunded companies

Purpose: This paper aims to investigate whether and to what extent equity crowdfunding (ECF) is able to build enduring businesses. This research explores the post-campaign growth of equity-crowdfunded companies and analyses the impact of intellectual capital (IC) on their growth. To achieve the above aim, we provide a theoretical framework that includes the three well-known dimensions of IC – i.e. human, structural and relational capital – as independent variables and company growth, meant as sales and employment growth, as dependent variable. Design/methodology/approach: This research uses a quantitative methodology based on two regression analyses. The authors use hand-collected data on 51 successful equity-crowdfunded projects listed on seven Italian platforms. Findings: The authors find that three variables, namely prior industry experience (human-capital), product innovation (structural-capital) and equity offered (relational-capital) are significant and positively related to the growth of equity-crowdfunded companies. In particular, prior industry experience positively influences sales growth; product innovation positively influences employment growth. Equity offered, instead, has a strong positive impact on both sales and employment growth. Companies that offer a larger percentage of equity during the campaign disclose higher probabilities of growth. Practical implications: The study has useful implications for several stakeholders, in particular, founders, platform managers, crowdfunders, policy makers and authorities. Originality/value: The results shed some light on the nascent research field related to post-campaign scenarios of equity-crowdfunded companies. This paper is the first to explore the impact of IC on the growth of companies funded through ECF.