Research and publications

Main research topics:

  • Equity crowdfunding and Peer2Business lending

  • Reward and Donation-based Crowdfunding

  • Fintech

To achieve industry-wide research ECAF impartial institution collects, organize and stores micro-data and survey-based data on Peer-to-Peer Business Lending, Equity-based Crowdfunding, Reward-based Crowdfunding, Donation-based Crowdfunding, Peer-to-Peer Consumer Lending, Credit Unions and Market-place Lending. Initial activities will be focused on the Netherlands with European markets to follow soon afterwards.

Financing sustainable Innovation- From a principal-agent to a collective action perspective

The importance of transitioning to a sustainable economy - one which safeguards ecological life-support systems and provides equity within and between generations - has become increasingly urgent. A crucial ingredient of such a transition is sustainable innovation by new or existing enterprises, to develop business activities that realize both societal and financial value. However, obtaining finance for sustainable innovation is often a challenge due to both principal-agent and (double) externality problems. While society benefits from investments into sustainable innovation, the financial and societal return for individual financiers is highly insecure.

This dissertation explores how to enable finance for sustainable innovation, with a focus on banks and crowdfunding platforms. It makes use of two theoretical lenses. First, it studies how to overcome principal-agent problems through different lending technologies. Second, and more novel, it takes a collective action perspective to address the double externality problem embodied in sustainable innovation finance. This research fills a gap because there exist empirically well-defined mechanisms for solving collective action problems that have not yet been applied to the finance domain. Furthermore, the dynamics of collective action appear particularly relevant in the emergence of technologically driven, decentralized financial instruments like crowdfunding.

This dissertation draws conclusions regarding the role of relationships, cash flows and assets as enablers of sustainable innovation finance, as well as regarding motivations of crowdfunders to undertake such investments. It highlights the challenge of enabling sustainable innovation finance while guarding the quality of the investment decisions in line with the motivation of the financier.

Link to Thesis: 

Crowdfunding and Social Capital: A Systematic Literature Review

Crowdfunding has been rising rapidly as a new entrepreneurial finance channel. Research on crowdfunding has also been on the rise recently, with social capital theory as one of the most promising theories for understanding crowdfunding. Research on the relationship between social capital and crowdfunding includes many different perspectives and uses a large variety of classifications of social capital. This paper aims to provide a comprehensive review of how social capital affects crowdfunding. This paper classifies social capital into structural, relational and cognitive dimensions and describes elements of each dimension of social capital based on social capital research.

Based on this classification, this paper expands the scope of social capital crowdfunding research to studies involving facets of social capital such as trust and identity. This paper conceptually analyses how each facet of social capital affects crowdfunding. Based on this review of research, a synthetic model is built to explain how different facets of social capital develop in virtual communities and how they interplay with each other and finally affect crowdfunding success. We finish this paper with directions for future research.

Link to paper: 

Crowdfunding Sustainable Enterprises as a Form of Collective Action

Crowdfunding is perceived as a particularly promising source of finance for sustainable initiatives. By undertaking an institutional, rule-based analysis of crowdfunding, this chapter introduces three key mechanisms that may create collective action among crowdfunders, thereby increasing availability of funds for sustainable enterprises. Firstly, the use of social networks can increase collective action, especially in the crucial early stages of a crowdfunding campaign. Existing (strong and weak) ties can decrease fears of moral hazard and increase trust about expected participation of other funders.

Furthermore, smaller group sizes can enhance the feeling that an individual contribution really matters and can also lead to reputational concerns for not participating. Second, crowdfunding allows for heterogeneous contribution and payoff rules, ranging from debt/equity to rewards to impact and combinations of these. This creates new niche funding markets where the payoff is tailored to a specific crowd and also enables an enterprise to engage its value chain as funders in particular users/clients. Third, crowdfund campaigns can lead to conditional cooperation, since campaign websites display who has already funded and provides a threshold (deadline) within a certain amount of funding needs to be reached.

Making the cooperative behavior of others transparent has been shown to be a crucial factor for increasing cooperation levels and can be applied to sustainable entrepreneurial finance. Both entrepreneurs and crowdfunding platforms can use these three mechanisms to increase the success rate of sustainable entrepreneurial finance, which can open up additional sources of funds for a sustainable financial system.

Download the book chapter here (Springer, 2018)

A diverse and resilient financial system for investments in the energy transition

Diversity makes the financial system more resilient. In addition, there is a diverse investment demand to make the transition to a more sustainable energy system. We need, among others, investment in energy transition, circular resource use, better water management and reducing air pollution. The two are linked. Making the financial system more diverse implies more equity, less debt, more non-bank intermediation and more specialized niche banks giving more relation-based credit. This will arguably also increase the flow of funds and resources to innovative, small-scale, or experimental firms that will drive the sustainability transition. Higher diversity and resilience in financial markets is thus complementary and perhaps even instrumental to engineer the transition to clean energy in the real economy.

Download the academic publication here (Current Opinion in Environmental Sustainability, 2017)

National Crowdfunding Research (NCO)

In recent years, crowdfunding has grown from a tool for foundations and artists to raise funding through donations, an alternative to bank financing for SMEs and financing of real estate and renewable energy projects. But who are the financiers of these projects? Are these investors who only look for financial returns, or do they have other expectations? And how do they decide to invest or participate in a project?

To explore these questions, the CrowdfundingHub started with the first edition of the 'National Crowdfunding Research' in 2013. This year CrowdfundingHub has taken the initiative to work with the Impact Centre Erasmus (Erasmus University Rotterdam), Sustainable Finance Lab (Utrecht University) and University of Amsterdam in order to provide a more scientific basis for this emergent research field.

Download NCO 2016 and 2013 reports here (In Dutch)

Survey data is available open access here

The Current State of Crowdfunding in Europe

The CrowdfundingHub worked together with more than 30 experts in all the European countries and asked them to provide reports and data about the crowdfunding industry in their country and give their insights and views on the industry. These experts also shared their knowledge about existing and upcoming regulations.

Download the report here

Crowdfunding Cross Borders: Assess Liability Risks

CrowdfundingHub teamed up with FG Laywers in a pan-European research to identify liability risk in respect to various forms of crowdfunding. The research is entitled Crowdfunding Cross Borders. CrowdfundingHub and FG Lawyers have enlisted the assistance of partners in 11 different European countries to aid in the collection of information across Europe.

Download the report here