Protecting investors in equity crowdfunding: An empirical analysis of the small investor protection act

Publikation: Beitrag in FachzeitschriftForschungsartikelBeigetragenBegutachtung

Beitragende

  • Maximilian Goethner - , Friedrich-Schiller-Universität Jena, IZA Forschungsinstitut zur Zukunft der Arbeit (Autor:in)
  • Lars Hornuf - , Universität Bremen, Max Planck Institute for Innovation and Competition, Münchener Gesellschaft zur Förderung der Wirtschaftswissenschaft - CESifo GmbH (Autor:in)
  • Tobias Regner - , Friedrich-Schiller-Universität Jena (Autor:in)

Abstract

During the past decade, equity crowdfunding (ECF) has emerged as an alternative funding channel for startup firms. In Germany, the Small Investor Protection Act became binding in July 2015, with the legislative goal to protect investors engaging in this new asset class. Since then, investors pledging more than 1,000 EUR now must self-report their income and wealth. Investing more than 10,000 EUR in a single ECF issuer is only possible through a corporate entity. We examine how the Small Investor Protection Act has affected investor behavior at Companisto, Germany's largest ECF portal for startup firms. The results show that after the new law became binding, sophisticated investors invest less on average while casual investors invest more. Moreover, the signaling capacity of large investments has disappeared.

Details

OriginalspracheEnglisch
Aufsatznummer120352
Seitenumfang15
FachzeitschriftTechnological Forecasting and Social Change: an International Journal
Jahrgang162
PublikationsstatusVeröffentlicht - Jan. 2021
Peer-Review-StatusJa
Extern publiziertJa

Externe IDs

WOS 000601162500004
Scopus 85092687632
ORCID /0000-0002-0576-7759/work/142239289

Schlagworte

Schlagwörter

  • Crowdinvesting, Equity crowdfunding, Investor protection

Bibliotheksschlagworte