The Narative Advantage: Why Women Are More Successful than Men at Crowdfunding Because of the Language They Use to Describe Their Projects

9 Feb

A leading crowdfunding research report from Andreea Gorbatai, UC Berkeley, and Laura Nelson, Northwestern University, details why women are better at crowdfunding because of the language they use in their crowdfunding campaigns

By Robert Hoskins

Austin, Texas – According to a new crowdfunding research report, it is not what you say, but the words you use to say it when communicating the features and benefits of a crowdfunding campaign. If you are researching how to launch a successful Kickstarter or Indieogogo crowdfunding campaign, we highly recommend that you read both “The Narrative Advantage: Gender and the Language of Crowdfunding” and “The Language that Gets People to Give for Successful Kickstarter Campaigns.”  These research reports will greatly enhance your ability to use the most effective and persuasive language possible to reach donors and investors and instill a desire to support your crowdfunding campaign.

Here is an introduction to what the crowdfunding research report covers:

“Economic and social arrangements in markets and organizations have been shown to systematically disadvantage women across a wide range of outcomes ranging from hiring, performance evaluations, rewards, and promotion in the labor market to financial support in the capital market. Research has identified several mechanisms through which this inequality is perpetuated, ranging from homophily, tokenism and structural constraints to negative stereotyping and women’s own beliefs about their skill level and worth in the labor market.

The Narrative Advantage Gender and the Language of Crowdfunding

The Narrative Advantage Gender and the Language of Crowdfunding

In particular, research on financing, small business, and entrepreneurship has shown that women are at a marked disadvantage compared against men with similar skill and experience levels. This difference has been largely attributed to choice homophily among predominantly male funders, and to the type of businesses that women start.

In the venture capital industry, male venture capitalists acts as gatekeepers; this results in less funding and mentorship for female entrepreneurs. In other entrepreneurial ventures, women gravitate towards small business ventures where they are often the sole employee instead of choosing scalable business projects.

In all these contexts, the long term outcomes – financing, and the terms of the financing deals – are the results of many difficult to quantify factors resulting from the interaction between the funder and the entrepreneur. It is thus difficult to isolate the effects that non-verbal behavior, paralinguistic cues, contextual factors, and interactions between the entrepreneur and the funder have on the final decision regarding funding. Some of these factors have been studied experimentally in the laboratory (Brownlow and Zebrowitz 1990; Carney, Cuddy and Yap 2010; Kramer 1977).

The majority of these studies rely on evaluating the effect of these factors on the audience, controlling for language content. But the language we use is intimately connected to how we think, and how others evaluate what we are saying. Moreover, language is connected with socio-demographic characteristics of the speaker or writer, such as gender, age or occupation.

In this study we aim to examine the effect of language on the success of crowdfunding campaigns, and the relationship between linguistic content and gender. Online, text-based campaigns are ideal for examining the effect of language content apart from characteristics of the delivery medium, message sender, and audio-visual information because the message is delivered to the potential donors via an information-poor, asynchronous text interface.

In turning our attention to the language used in crowdfunding campaigns, we examine four different dimensions of language content in campaign descriptions: positive (sentiment) language, vividness, inclusive language, and business language. We then suggest that three of these types of linguistic content (positive sentiment, vividness and inclusive language) are both more likely to be rewarded in crowdfunding campaigns, and more likely to be used by women, while the use of language related to money is more likely to be penalized in the crowdfunding context and more likely to be used by men. We then test and confirm our theory that language mediates the relationship between gender and fundraising outcomes using data from the online crowdfunding site Indiegogo.

Our findings indicate that gender-specific language partially mediates the success of women in fundraising money through crowdfunding. This study identifies an economic institution (crowdfunding) where female-specific linguistic patterns are preferred over male- specific patterns, leading to a reversal in gender inequality with respect to funding.

Additionally, this study contributes to economic sociology research on gender by quantifying the impact of linguistic choices on fundraising outcomes. Lastly, this research contributes to research in computational sociology by employing topic models to refine the product classification of crowdfunding campaigns and quantify crowdfunding campaign text along several content dimensions using the Linguistic Inquiry Word Count dictionary (Tausczik and Pennebaker 2010).”

An outline of the report:

Theory and Hypotheses:

Introduction

Money and Language

1a. Crowdfunding proposal success decreases with the use of money-related language.

1b. Crowdfunding proposal success increase with the use of vivid language.

1c. Crowdfunding proposals success increases with positive emotion.

1d. Crowdfunding proposal success increases with the use of inclusive (relational) language.

Gender and Language

2a. Women use more inclusive language than men do.

2c. Women use more vivid language than men do.

2d. Women use less language related to money than men do.

Language, Gender and Crowdfunding Success

3. Language mediates the relationship between gender and fund-raising success.

 Conclusion

# # #

Robert Hoskins, a seasoned Front Page PR veteran provides more than twenty-five years of external communications, media relations, digital social media and SEO skills to Front Page PR’s crowdfunding PR and media relations service portfolio.
(512) 627-6622
@Crowdfunding_PR


Mr. Hoskins is a seasoned marketing veteran with a proven track record of helping entrepreneurs, startups, small businesses as well as Fortune 500 corporations launch successful marketing communications campaigns to gain market traction for a wide variety of products and services.
Hoskins is one of the crowdfunding industry’s foremost crowdfunding advocates and has amassed a huge social media following that is dedicated to supporting donation-, rewards- and equity-based crowdfunding campaigns. Due to the overwhelming demand from the general public for crowdfunding information, he empowers entrepreneurs with some of the internet’s most affordable ($20) online crowdfunding training classes, which provide insight to startups around the world on a 24 x 7 basis.
Hoskins adamantly believes that the crowdfunding industry will empower everyone in the United States to rediscover the possibility of living the American dream with a little hard work, a great business idea and the dedication to researching, planning and launching a well-thought-out crowdfunding campaign. He consults on a regular basis with crowdfunding campaign managers as well as crowdfunding sites, portals and platforms to deliver successful crowdfunding marketing campaigns.
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