Entrepreneurial Finance ∩ Entrepreneurial Marketing
New ventures are the backbone of modern economies, serving as engines of innovation, growth, and societal change. Yet, entrepreneurs face immense challenges to secure vital early support and effectively engage key stakeholders. As an empirical scholar, I work at the intersection of entrepreneurial finance, strategy, and marketing to improve efficiency in entrepreneurial markets. To generate actionable insights, I employ a rigorous quantitative toolkit: Field experiments establish causal relationships in real-world settings, large-scale archival analyses leverage unique web-scraped datasets to ensure external validity, and lab studies isolate underlying mechanisms. My research program on (1) strategic communication through narratives and visuals in entrepreneurial resource acquisition, (2) market frictions and cognitive biases in entrepreneurial finance, and (3) hidden aspects of organizational design in venture creation and scaling aims to advance understanding of entrepreneurial processes while equipping entrepreneurs, investors, and policymakers with evidence-based insights to foster more resilient and innovative ecosystems. You can find my more detailed information in my CV or on my faculty page.
Selected Publications
- Blaseg, D. & Schwienbacher, A. (2024): Biased Calibration: Exacerbating Instead of Mitigating Entrepreneurial Overplacement with Reference Values, Entrepreneurship Theory and Practice, 48(5), 1131–1159.
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Nascent entrepreneurs often believe their chances of success are better than those of others due to imperfect information about the competencies and accomplishments of other entrepreneurs, leading to overplacement. Theory suggests that the provision of historical outcome data of comparable projects could help entrepreneurs develop more realistic plans and expectations by closing the information gap and enabling the calibration of their beliefs. However, effectively calibrating beliefs by incorporating new reference information requires effortful cognitive processing and rational integration of the data, which may be impeded by the same cognitive biases leading to overplacement initially. Drawing from a unique dataset that allows us to observe substantial parts of the planning process of 971 entrepreneurs, we investigate the effectiveness of providing reference values as a debiasing tool. Rather than rationally leveraging the information for honest self-assessment, our findings suggest that entrepreneurs use the information to differentiate themselves even more from the reference group after they see the historical values. This, in turn, results in an even higher level of overplacement. - Wolfe, M., Blaseg, D., Patel, P., & Chan, C. (2024): Mix With the Crowd? Craft-Based Campaigns and the Value of Distinctiveness in Campaign Success, Strategic Entrepreneurship Journal, 18(4), 770-810.
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Distinctiveness is an essential element of crafts. Building on optimal distinctiveness theory, we examine the relationship between craft-based ventures, distinctiveness, and crowdfunding performance. Using a sample of 10,915 craft campaigns and 429,290 non-craft campaigns, we find that craft-based campaigns have higher distinctiveness but realize lower success through distinctiveness. Additionally, craft-based campaigns with a higher risk index have lower distinctiveness, those with higher strategy breadth have higher distinctiveness, and those with lower cognitive complexity have higher distinctiveness. The findings have implications for crafts-based entrepreneurs in leveraging distinctiveness and the value of lowering perceptions of distinctiveness through elements of strategic entrepreneurship—strategy breadth and cognitive complexity. - Blaseg, D. & Hornuf, L. (2024): Playing the Business Angel: The Impact of Well-Known Business Angels on Venture Performance, Entrepreneurship Theory and Practice, 48(1), 171-204.
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People well known to the general public are increasingly acting as business angels (BAs) for young and innovative ventures worldwide. These BAs are less known for their venture evaluation skills and often do not have a professional reputation as investors. The signaling function of these well-known investors could therefore be less relevant for founders because of a limited quality assurance function. Nonetheless, a venture’s affiliation with a well-known BA may still positively alter the quality perceptions of various stakeholders because the BAs can put their reputation in other areas of life at risk, provide an easy-to-interpret and fluent cue to the general public, and improve the observability of the signal. Using a sample of more than 2,900 early-stage ventures that made a venture pitch during the Canadian, German, U.K., and U.S. versions of the reality TV show Dragons’ Den, we find that BAs’ degree of being known has a positive impact on target firm survival, web traffic, and sales. The impact of BAs’ general degree of being known is particularly strong if the congruency between the investors and the target ventures is high. These effects exist over and above potential selection effects, the professional reputation of the BA, and the greater financial resources of a funded venture. The empirical findings indicate that well-known BAs can have a positive effect on venture performance and that founders should consider not only the professional reputation of BAs but also the degree to which they are known to a general audience. - Blaseg, D., Cumming, D., & Koetter, M. (2021): Equity Crowdfunding: High- or Low-Quality Entrepreneurs?, Entrepreneurship Theory and Practice, 45(3), 505–530.
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Equity crowdfunding (ECF) has potential benefits that might be attractive to high-quality entrepreneurs, including fast access to a large pool of investors and obtaining feedback from the market. However, there are potential costs associated with ECF due to early public disclosure of entrepreneurial activities, communication costs with large pools of investors, and equity dilution that could discourage future equity investors; these costs suggest that ECF attracts low-quality entrepreneurs. In this paper, we hypothesize that entrepreneurs tied to more risky banks are more likely to be low-quality entrepreneurs and thus are more likely to use ECF. A large sample of ECF campaigns in Germany shows strong evidence that connections to distressed banks push entrepreneurs to use ECF. We find some evidence, albeit less robust, that entrepreneurs who can access other forms of equity are less likely to use ECF. Finally, the data indicate that entrepreneurs who access ECF are more likely to fail. - Blaseg, D., Schulze, C., & Skiera, B. (2020): Consumer Protection on Kickstarter, Marketing Science, 39(1), 211-233.
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This article investigates consumer protection on Kickstarter—a popular and sizeable, yet largely unregulated reward-based crowdfunding platform. Specifically, the article focuses on Kickstarter campaigns’ use of price advertising claims (PACs) and their failure to honor the promised discounts. Analyses show that between 2009 and 2016, more than 500,000 consumers who backed a wide variety of game or technology campaigns lost on average $45.72 because of broken PAC promises. Whereas 75% of PAC campaigns did not provide the promised discounts, in almost 50% of all cases backers who were promised a discount paid more, not less, than the retail price. In contrast, backers of campaigns that did not promise a discount received larger effective discounts. Analyzing an extensive data set comprising 34,745 Kickstarter campaigns, complete backing histories of more than 400,000 backers, and more than 4 million consumer comments, complaints, and reviews, we show that broken PAC promises pose a substantial problem to consumers, that the problem is persistent across more than 6 years, and that it has not been resolved through self-regulation by market participants thus far.