Exploring embeddedness, centrality, and social influence on backer behavior: the role of backer networks in crowdfunding

This research examines the influence of backers’ social networks on their backing behavior using data from a large social networking site and a reward-based crowdfunding platform. We distinguish the roles of nodes and ties in a backer’s social network and assess the combined and differential effects of these two types of social relationship on the backer’s pledge decisions. As backers have different motives for engaging in different crowdfunding campaigns, which range from commercially oriented technological innovation to community-based social development, we further examine how these effects differ between technology-oriented campaigns and social-oriented campaigns. We find that node-level factors (e.g., centrality) have a greater influence on technology-oriented campaigns than on social-oriented campaigns, while tie-level factors (e.g., embeddedness) have a stronger impact on social-oriented campaigns. Considering the two forms of embeddedness in tandem, we find that the effects of relational embeddedness on backers’ pledge decisions are not only moderated by structural embeddedness but also contingent on campaign type. These results offer important theoretical insights into the drivers of contribution, which should be considered by crowdfunding operators and campaign proponents seeking to stimulate contribution.