Kickstart my market: exploring an alternative method of raising capital in a new media sector

Abstract

ABSTRACT Competitive videogames (esports) are an exciting new media format, affording experiences that are dynamic, ephemeral, immersive, social, mobile, and escapist. Instantaneous digital distribution and global reach also make this media format especially lucrative for industry stakeholders. Despite increasing attention on esports and the importance of entrepreneurship to esports, research has only begun to investigate how entrepreneurs successfully enter this new and tumultuous industry segment. The purpose of this article is to (1) assess the market dynamics at work in this sector and (2) determine some of this unique market’s most important determinants of success. Using a sample of N = 16,326 esport projects between 2009 and 2017, the analysis suggests that crowdfunding an esport project is more difficult than crowdfunding projects in other industries. Then, a logistic regression identifies several success determinants of esport projects. Overall, both stages of the investigation reinforce that a the surplus of eport projects on crowdfunding platforms reflective of significant lost opportunity costs stemming from founder-funder information asymmetries.