Resumo

Digital crowdfunding platforms have been used around the world for various purposes, such as collective lends or development of new products. According to the Crowdfunding Industry Report, those platforms handled a total of $ 34.4 billion in 2015. Studies on crowdfunding are concentrated mainly in two scopes: one that demonstrates the motivational and behavioural aspects of creators and supporters engaged in such platforms (Agrawal, Catalini & Goldfarb, 2011) and another that focuses on success factors of crowdfunding campaigns (Belleflamme, Lambert & Schwienbacher, 2014).

In the literature on the behaviours of supporters, we found divergent results on the matter of geographical distance between creators and supporters (Agrawal et al.,2011; Mendes-Da-Silva et al., 2016), which motivated our research question: Does the geographical distance between creator and supporter play a different role in crowdfunding in Brazil? We propose an alternative theory to explain the geographical aspect of crowdfunding using a native IS theory: the virtualization theory (Overby, 2008).

Overby (2008) proposes that, whenever we are interested in understanding questions about the virtualization of a process, such as why some processes can be better virtualized than others, we can benefit from the virtualization theory, a native IS theory. We, thus, propose to analyze the phenomenon of the virtualization of traditional fundraising processes, based on a digital or web platform, in the light of this theory for two reasons: it offers a different explanation to the geographic distance problem and to contribute to the IS discussion in conjunction with other native theories.

To answer this question, we analysed a database, which contains 58 projects and 7.104 transactions, using OLS regression to test 2 models with 5 hypothesis: H1: The lower the distance, the greater the amount of support transaction value. H2: The greater the minimum value established, the greater the support value. H3: The kind of cultural project affects the transaction value. H4: The greater the number of rewards (options), the greater the support transaction value. H5: The higher the established value to gain access to the cultural product supported, the higher the transaction value.

Both models are statistical significant at the 0.95 level and present adjusted R-squared near 25%, with little improvement on the second model, according to the results presented. We checked the absence of multicollinearity with VIF < 5 and tolerance > 0.2, as well as the normality of residuals in histogram and auto-correlation with the Durbin-Watson test. The variable Rewards (H4) was the only one to not enter into model 1 and Distance, as expected, had a negative beta.

The geographic paradox, which relies on the fact that the virtualization of a fundraising process was expected to enlarge supporters’ participation across time and space. However, due to the virtualization requirements, specially the relationship ones, this does not occur in Brazil yet, as we found comparing the average distance of 183 kilometers between creator and supporter and the fact that 50% of transactions come from very close supporters, at 27.44 kilometers (see median or Q2 of the Distance variable) with the average distance found by Agrawal et al. (2011), that was 4,828 kilometers.

Agrawal, A. K., Catalini, C., & Goldfarb, A. (2011). The geography of crowdfunding [Working Paper N_16820]. National bureau of economic research. Cambridge, MA. doi: 10.3386/w16820. Belleflamme, P., Lambert, T. (2014). Crowdfunding: Some Empirical Findings and Microeconomic Underpinnings. Availabe at: . Mendes-Da-Silva, W., Rossoni, L., Conte, B. S., Gattaz, C. C., & Francisco, E. R. (2016). The impacts of fundraising periods and geographic distance on financing music production via crowdfunding in Brazil. Journal of Cultural Economics, 40(1), 75-99.