Does Gender Matter? Gender Signals in a UK Equity Crowdfunding Experiment

Abstract

Abstract While research shows that women entrepreneurs often struggle to secure funding from traditional loan institutions, crowdfunding offers a unique channel to bypass traditional loan gatekeepers and directly access funds from the public. This study explores whether the gender of the entrepreneur sends a signal to a funder, specifically, whether gender homophily affects the organisational attractiveness of a business venture. Additionally, we explore if there are any effects of the organization type and equity return. Using an online survey experiment with UK participants ( n = 4510), via Prolific, we manipulated the gender of the entrepreneur (woman vs. man), the organization type (healthcare vs. fintech) and the equity return (5% vs. 10%) for a hypothetical business venture. Our findings may help explain the mixed results of extant research on gender and entrepreneurship. We found that the organization type, equity returns and experience of funders play a role in the extent to which funders find an organization attractive and willingness to support a business venture. Specifically, our findings show that healthcare ventures were more attractive to women, while men were more attracted to greater equity returns. As a scholarly contribution, we suggest that gender value homophily may partly explain the nuanced findings.