According to Phys.org, researchers from the University of East Anglia analyzed 1,189 successful crowdfunding campaigns on Seedrs and found some surprisingly specific patterns for what attracts investors. The study revealed a £90,000 “sweet spot” for funding targets, with campaigns aiming for this amount performing significantly better than higher targets. They also found that having around 19 team members was optimal, and that using words like “health” and “organic” in pitches boosted success while “entertainment” and “information” had negative effects. Perhaps most interestingly, offering a higher percentage of equity actually attracted more investors, contradicting previous research that suggested lower equity offers were better.
The sweet spot science
Here’s the thing about that £90,000 figure – it’s basically a psychological threshold. Investors apparently look at anything above that and start getting nervous. It makes sense when you think about it. A smaller target feels more achievable, like you’re helping someone get their business off the ground rather than funding some massive corporate venture. But I wonder if this number is platform-specific or if it translates across different crowdfunding sites. And what about inflation? A few years from now, will that sweet spot be £100,000 or £120,000?
The equity surprise
This is where the research gets really counterintuitive. Conventional wisdom said you should hold onto as much equity as possible, right? But apparently investors see low equity offers as a red flag. They interpret it as either the founders don’t value their contribution, or the company’s valuation is inflated. Basically, if you’re not willing to give up a decent chunk of your company, why should they believe in it? It’s a fascinating shift in investor psychology that could completely change how entrepreneurs structure their deals.
Buzzword bingo
The word analysis part is both useful and slightly terrifying. “Health” and “organic” performing well makes perfect sense in our wellness-obsessed culture. But “entertainment” and “information” being turn-offs? That’s pretty revealing about what investors think has real business potential these days. It makes you wonder if we’re heading toward a future where every pitch deck sounds the same, filled with the same magic words that trigger investor interest. There’s a real risk of gaming the system here without actually having a better product.
Team dynamics
Nineteen team members seems oddly specific, doesn’t it? The researchers suggest it’s about balancing competence with coordination – too few people and you lack skills, too many and you get bogged down in disputes. But here’s my question: does this include everyone, or just the core team? And what about remote teams versus co-located ones? The number feels like it might be more of a correlation than a prescription. Still, it’s useful data for entrepreneurs thinking about how to present their team structure to potential investors.
