Crowdfunding Campaigns: Tech Jargon? Please, Mind the Gap

A new study from Yuchen Zhang, assistant professor of management at the Freeman School of Business, suggests that the amount of tech jargon included in a Kickstarter project’s description could affect its success raising funds.

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Pictured: Yuchen Zhang, assistant professor of management at the Freeman School of Business.

Through an agent-based simulation model, which is a computational model that simulates interactions between variables, Zhang replicated a crowdfunding community of 10 projects and 1,000 contributors.

Zhang counted the use of technical terms in each project’s description and compared the funding performance with the number of technical terms they featured.

The results showed an inverted U-shaped relationship between project descriptions and product funding, meaning that two extremes would decrease a project’s financing performance.

If a proposal uses too many technical terms, potential funders may have difficulty understanding the product’s description. However, if a project lacks enough technical terms in its description, then backers cannot properly evaluate the project.

Zhang commented:

“People want to ‘buy’ a novel product, but they also want to make a rational evaluation of how good that product is before they buy it.”

Find out more here.

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