Financial Innovation and Crowdfunding: Influencing Investment Decisions in Tech Startups
Round 1
Reviewer 1 Report
Comments and Suggestions for AuthorsDear authors,
The topic is interesting; however, it should be improved by addressing the following issues:
Abstract
1. The abstract does not provide sufficient background or rationale for the study. Why is it important to examine the financial behavior of Thai investors in equity crowdfunding, and why is the chosen context significant?
2. The abstract does not clearly articulate the research gap or the motivation for conducting this study. It would benefit from a brief statement on the novelty or significance of the research.
3. While the abstract mentions using PLS-SEM and the theoretical models, it lacks detail on how these frameworks were operationalized. For example, how were the constructs measured? Additionally, a brief mention of the sample (e.g., how the 275 Thai investors were selected) would strengthen the methodological clarity.
4. The findings are mentioned but remain somewhat general. Specific numerical results or effect sizes from the PLS-SEM analysis could make the abstract more informative and precise.
5. The abstract does not discuss the practical or theoretical implications of the findings. What do these results mean for the field, investors, platforms, or future research?
6. The sentence structure could be simplified for better readability, particularly in the explanation of relationships between variables (e.g., "PU, directly and indirectly, influences investment decisions through PEOU").
Introduction
1. The introduction does not clearly articulate the research gap. While it provides a general overview of equity-based crowdfunding (ECF), it does not explain what specific aspects of investor behavior, financial innovation, or crowdfunding in tech startups remain underexplored or why this study is necessary.
2. The introduction could be more focused on the specific contributions of prior research relevant to the study, rather than broadly citing topics such as mobile banking or general advancements in finance. It should directly reference literature that discusses financial innovation in ECF, especially within the context of Thailand or similar emerging markets.
3. While the introduction provides some contextual information about the growth of ECF and technology startups in Thailand, it fails to introduce or hint at the theoretical frameworks that will guide the study (e.g., models or theories used to analyze investor behavior). Introducing these models early would give readers a clearer understanding of the study’s foundations.
4. The transition from the description of ECF and the Thai startup ecosystem to the specific research aim is abrupt. The introduction should explain more explicitly how these contextual elements lead to the need to study financial innovation and investor behavior in crowdfunding.
5. The research aim is somewhat vague. It states that the study will examine financial innovation from the perspective of investors but does not clearly define the core research question(s) or hypotheses being tested. This could be more explicit to guide the reader on what to expect.
6. While the expected contributions are outlined, they are too broad and not very specific. For instance, how will platform providers and government agencies benefit from the findings? Clarifying these contributions with concrete examples or outcomes would add value.
7. The text includes placeholders for editorial information (e.g., “Citation: To be added by editorial staff”) that should be removed or completed before submission. Additionally, the repeated citation of some sources (e.g., Juasrikul & Vandenberg, 2022) suggests a lack of diversity in the literature review.
Literature review:
1. The literature review presents various aspects of equity crowdfunding (ECF) but does not include an overarching conceptual framework that ties these themes together. A clear framework or model should be introduced early to provide coherence to the different sections.
2. Some of the references, such as "Crowdfunding's Potential for the Developing World" (2013), seem outdated for a 2024 article. It is important to ensure the literature review is built on recent studies and that older sources are used only when foundational.
3. There are missing citations or details that may lead to confusion (e.g., “Davis (1989), Davis (1989)” in section 2.5). This should be corrected for clarity and proper referencing.
4. The review does not sufficiently engage with more recent trends in financial innovation, such as decentralized finance (DeFi), blockchain's role in crowdfunding, or the impact of regulatory changes in different regions. Since ECF is an evolving field, more up-to-date studies and technologies should be incorporated.
5. The literature review mostly provides a descriptive summary of existing studies but lacks critical engagement. It is important to identify gaps, debates, and inconsistencies within the literature and point out areas where further research is necessary. This can show that the study is grounded in a thorough understanding of the subject.
6. The literature review focuses heavily on U.S.-based regulatory and market practices (SEC regulation). Given that crowdfunding is a global phenomenon, it would benefit from discussing regional differences in crowdfunding markets, investor behavior, and regulatory frameworks in different countries.
7. The transition between sections is somewhat abrupt. The structure can be improved by using clear topic sentences that link sections logically. For instance, section 2.2. on platform quality feels disjointed from section 2.1 on equity crowdfunding. There should be a more fluid connection between these themes.
8. The review could benefit from a discussion of the methodologies used in the cited studies. It would be useful to include an evaluation of the methodologies used in previous research, highlighting their strengths and weaknesses to set up the justification for the current research’s methodological approach.
9. The literature review largely highlights the positive aspects of ECF without much focus on the risks associated with it. Including a discussion of potential risks such as fraud, platform failure, or high failure rates in startups could provide a more balanced perspective.
10. Although the title of the article indicates a focus on tech startups, this connection is not explicitly discussed in the literature review. It should include studies on how ECF impacts technology startups specifically and the unique challenges and opportunities these ventures face compared to other sectors.
11. The Technology Acceptance Model (TAM) is discussed, but no other theoretical frameworks related to financial innovation are integrated. A discussion of theories like Innovation Diffusion Theory or Transaction Cost Economics could help deepen the analysis.
Hypothesis Development
1. While the section presents relevant literature to support each hypothesis, it lacks a clear, overarching theoretical framework. The hypotheses are connected to individual studies, but it would be more coherent to base them on a structured model such as the Technology Acceptance Model (TAM), Theory of Planned Behavior (TPB), or Unified Theory of Acceptance and Use of Technology (UTAUT). Explicitly introducing such a model would strengthen the conceptual foundation of the hypotheses.
2. The section mainly summarizes prior research but does not critically assess how these studies relate specifically to the context of tech startups and crowdfunding. It would be beneficial to clarify how the findings from other domains (e.g., Islamic crowdfunding, mobile banking) can be transferred or adapted to the context of tech startups. This could make the hypotheses more grounded in the study's unique setting.
3. Some hypotheses appear redundant or overlapping. For example, Hypotheses 3 and 4, which relate to platform characteristics influencing both perceived usefulness (PU) and perceived ease of use (PEOU), could be merged or differentiated more clearly. Similarly, Hypotheses 5 and 6 on social influence affecting both PU and PEOU could be consolidated or supported with distinct reasoning. Combining or clearly differentiating these relationships would streamline the hypothesis development.
4. Key variables such as “platform quality,” “platform characteristics,” and “social influence” lack precise definitions. Without clear operationalization, it is hard to know how these constructs will be measured and how they differ from one another. Each construct should be defined explicitly, with references to relevant studies that operationalize them in the context of crowdfunding or financial innovations.
5. Some studies are cited without providing sufficient details about their findings. For instance, in section 3.5 on social influence, the statement "Hong, Hu, and Burtch (2018) noted that founder dynamics and opinion exchanges significantly impacted crowdfunding performance" is vague. More specific insights from this study should be included. In addition, older and foundational studies like Venkatesh & Davis (2000) are mentioned, but more current research would be helpful to demonstrate that the field has evolved.
6. Hypotheses 8 and 9 (regarding perceived usefulness and ease of use influencing the intention to invest) should include more detailed justifications. While there are references to studies that support these relationships, there is no explicit explanation as to why these factors are crucial specifically in the tech startup context. A discussion on the unique risks, investor behaviors, or platform functionalities relevant to tech startups would be useful.
7. The hypotheses seem largely derived from prior work in crowdfunding and technology acceptance, without highlighting how this study will contribute new insights. There needs to be a clearer argument about what is novel in this research—whether it’s the focus on tech startups, equity crowdfunding platforms, or specific features of financial innovations.
8. Hypotheses should be clearly labeled (e.g., H1, H2) for better readability. Currently, the hypotheses are written as part of the text, which can make it harder for the reader to track. Structuring them with proper labels (e.g., “Hypothesis 1 (H1): The quality of the equity crowdfunding platform...”) would improve the flow and organization.
9. Several hypotheses rely heavily on a few sources, such as Razak et al. (2021) or Sukmana et al. (2022). Diversifying the literature would make the hypothesis development section more robust. Ensure that the literature cited represents a broad range of studies, especially those focused on tech startups and financial innovation.
10. It would strengthen the study if alternative or null hypotheses were considered. For example, while the section posits direct relationships between platform quality and perceived usefulness, it would be useful to acknowledge that in some cases, factors like investor experience or platform accessibility might moderate these relationships.
Methodology:
1. The use of non-probability sampling, specifically purposive sampling, is mentioned, but there is no justification as to why this method is appropriate for the study. Why was purposive sampling chosen, and how does it ensure the sample represents the population of interest?
2. There is no explanation for why 275 participants are sufficient to draw meaningful conclusions. There should be a discussion on how the sample size was determined (e.g., through a power analysis or based on similar studies) and whether it is representative of the population of investors in Thailand's equity crowdfunding (ECF) platforms.
3. While the demographics of the sample are provided, there is no explanation of how representative this sample is of the broader population of investors or tech startup investors. Are the gender, age, and educational backgrounds of the respondents typical of the ECF market?
4. While the questionnaire sections are listed, there is no mention of whether the measurement items were pre-tested or validated. How was it ensured that the questions were valid and reliable for measuring the constructs (e.g., platform quality, perceived usefulness, perceived ease of use)? Were these constructs adapted from validated scales in previous research?
5. There is no mention of conducting psychometric analyses such as exploratory or confirmatory factor analysis, which would be necessary to validate the scale and ensure its reliability and validity.
6. The rationale behind including specific items for measuring each construct (e.g., subjective norms, perceived usefulness, ease of use) should be supported with references to theoretical models or prior studies (some are mentioned, but not consistently across all constructs).
7. The method of data collection (an online questionnaire) is briefly mentioned, but there is no detailed explanation of how the respondents were contacted or how the data was collected. Were the participants recruited through a particular platform? How were they incentivized (if at all) to participate?
8. It’s mentioned that data were collected in October 2023, but it is unclear whether this data collection period is sufficient to gather a representative sample or account for potential biases related to the timing (e.g., market conditions affecting investor sentiment).
9. There is no discussion of non-response bias. How were potential non-respondents handled, and could their absence have skewed the results?
10. There is no mention of the data analysis techniques that will be used to test the hypotheses. Will regression analysis, structural equation modeling (SEM), or another method be used to analyze the relationships between variables such as perceived usefulness, platform quality, and investment intentions?
11. There is no indication of whether confounding factors, such as prior investment experience or demographic variables, will be controlled for in the analysis. This is important given the differences in experience levels and other demographic factors in the sample.
12. There is no mention of ethical approval or whether participants were informed about their rights, including confidentiality and voluntary participation. This is a critical part of the methodology that should be explicitly stated, especially in studies involving human subjects.
13. How was informed consent obtained from participants? Did the questionnaire include a consent form, and was it clear that participation was voluntary?
14. Selection Bias: The use of non-probability sampling (purposive sampling) can introduce selection bias, but this is not addressed in the text. How might this affect the generalizability of the findings?
15. There is no mention of whether the questionnaire was designed to minimize response bias, such as leading questions or social desirability bias, particularly when asking about subjective norms and intentions.
16. The exchange rate conversion of 33.72 THB to 1 USD may not be relevant to the core methodology unless currency conversion plays a specific role in the analysis. This detail could be removed unless explicitly necessary for interpreting results.
17. Table 1, which presents the respondent profiles, could benefit from additional explanation in the text to discuss key trends or distributions. Currently, it is just a presentation of data with no deeper interpretation or insight into what the data signifies in relation to the study objectives.
18. Some of the cited works (e.g., Iivari, 2005; DeLone & McLean, 2003) are relatively old. More recent references should be considered, particularly in a fast-evolving field like financial technology and crowdfunding.
19. The fifth section of the questionnaire includes an open-ended question regarding challenges and recommendations. There is no mention of how this qualitative data will be analyzed. Will it be subject to thematic analysis, or will qualitative coding methods be used to draw insights from these responses?
Overall Recommendations:
1. Please check the enumeration, there are two sections number 3 in the paper.
2. Expand the Justification of Sampling and Analysis Techniques: Provide more detail on why the sample size and sampling method were chosen, as well as the specific statistical techniques planned for analyzing the data.
3. Incorporate Ethical Considerations: Include a clear statement on ethics, informed consent, and how participant confidentiality was ensured.
4. Improve Questionnaire Design Details: Include validation of the measurement scales and describe how open-ended responses will be handled.
5. Address Bias and Validity Issues: Discuss potential biases, both in sampling and responses, and consider how they will be mitigated in the analysis.
Analysis and Results
1. The article jumps straight into CFA and PLS-SEM analysis without providing any summary statistics, which are essential for understanding the sample characteristics and distribution of variables. Including mean, standard deviation, and frequency distributions would offer a better understanding of the dataset.
2. While the sample size (275 participants) is mentioned, the paper does not provide any justification for why this number is adequate. It's important to explain why this sample size is suitable for the statistical techniques used (CFA and PLS-SEM), possibly referencing power analysis or relevant literature.
3. CFA typically requires a detailed report of model fit indices (e.g., Chi-square/df, RMSEA, CFI, TLI). However, the results lack key indicators that assess the overall fit of the measurement model, aside from SRMR, which is more relevant to structural equation models. Including RMSEA, CFI, and TLI would help assess the goodness of fit in the confirmatory factor analysis.
4. The rationale for selecting PLS-SEM over other structural equation modeling approaches like CB-SEM (Covariance-Based SEM) is missing. PLS-SEM is typically used for predictive analysis or when the data has distributional issues, but this is not explained. A justification for the choice of PLS-SEM and the nature of the relationships tested (exploratory or confirmatory) would enhance the methodological rigor.
5. The text briefly mentions that "some factor loadings did not meet the 0.7 threshold," but it doesn't clarify which specific items were problematic and how these items were handled. The author should discuss whether any modifications were made, such as removing low-loading items or re-specifying the model.
6. The article refers to "Composite Reliability (CR ≥ 0.6)" which is a relatively low threshold. Typically, a threshold of 0.7 or higher is used in social sciences research to indicate good reliability. If the paper uses 0.6 as an acceptable threshold, this decision should be better justified and supported with references.
7. The multicollinearity analysis mentions the use of VIF but lacks a clear explanation of how these fits into the overall model evaluation. Providing a more explicit interpretation of multicollinearity results would help clarify its relevance in the context of the study’s model.
8. The discriminant validity assessment mentions correlation values "ranging from -1 to 1," which is too generic. The Heterotrait-Monotrait (HTMT) ratio is more appropriate for assessing discriminant validity in PLS-SEM. While the article reports HTMT values below 1, it lacks a full explanation of how these values support discriminant validity (e.g., HTMT values should ideally be below 0.85).
9. The reported GoF value of 0.640 is unusual because GoF is not commonly used in PLS-SEM and the criterion of "GoF > 1" is not standard. More common PLS-SEM model fit indicators like the normed fit index (NFI), SRMR (which is already mentioned), or bootstrapping statistics (e.g., path coefficients, t-values) should be included.
10. The section focuses on the measurement model but lacks clear reporting of hypothesis testing results. PLS-SEM involves analyzing path coefficients, their significance, and the R² values of endogenous constructs, yet this is missing or only partially covered. Including detailed path analysis results and bootstrapping statistics (e.g., t-values, p-values) is necessary for hypothesis testing.
11. The tables mentioned (Tables 2, 3, and 4) are referenced but not thoroughly discussed in the text. A more detailed interpretation of what these tables represent, how they support the model, and how they align with hypotheses would improve clarity.
12. The explanation of VIF states that "a VIF of 1 indicates no correlation," but this is slightly misleading. VIF of 1 indicates no multicollinearity, and values up to 5 suggest acceptable levels. Clarifying the role of VIF in relation to the independent variables and model structure would help.
13. The thresholds for AVE (≥0.5) and composite reliability (≥0.6) are reasonable, but the phrasing could be clearer. The authors should ensure consistency in citing appropriate thresholds (e.g., composite reliability is often expected to be above 0.7).
14. The SRMR value of 0.092 is mentioned, with a criterion of "SRMR ≤ 0.12" being cited. Typically, SRMR values below 0.08 are considered a good fit, and values between 0.08 and 0.10 indicate moderate fit. Clarifying this threshold would enhance the robustness of the analysis.
15. Consider performing robustness checks or sensitivity analysis to strengthen the validity of the model, such as testing the stability of the model with different sub-samples or varying model specifications.
16. Discussing the limitations of the model (e.g., generalizability, reliance on self-reported data) would add transparency and provide a balanced conclusion to the analysis.
Discussion:
1. The discussion lacks a robust interpretation of how the findings specifically contribute to the literature on financial innovation and equity crowdfunding (ECF) in Thailand. It would be helpful to frame the results in terms of the local context, such as regulatory environments, cultural factors, or differences between Thailand and other regions mentioned in the references (e.g., Indonesia, Spain).
2. While there are mentions of "subjective norms" and "third-party endorsement factors," the theoretical contributions of the study are underdeveloped. What theoretical models (e.g., Technology Acceptance Model, Theory of Planned Behavior) do these findings advance? How does this study push the boundaries of existing theories on financial innovation and crowdfunding?
3. The practical implications for ECF platforms are only briefly mentioned. A more detailed discussion of how these platforms can apply the findings to improve investor engagement would be beneficial. For instance, how could platforms enhance perceived quality, social influence, or ease of use? Can specific strategies or platform features be recommended based on the findings?
4. The discussion does not mention any limitations, which is a significant omission. Every study has limitations, whether related to the methodology (e.g., sample size, geographic scope), data collection, or the PLS-SEM approach used. Acknowledging these limitations can strengthen the validity of the conclusions.
5. While the findings are discussed, there is no mention of potential areas for future research. What questions remain unanswered? Are there aspects of financial innovation and crowdfunding that could benefit from further study, such as longitudinal analysis or testing in other emerging markets?
6. The discussion does not provide quantitative insight into the results. What are the effect sizes or significance levels for each variable? Including some of the numerical results from the SEM analysis could help to underscore the magnitude of the relationships.
Theoretical and Managerial Implications
1. While the section mentions certain theoretical frameworks (e.g., internalization, compliance), it doesn't clearly articulate the novel theoretical contributions of the study. What gap in the literature does this research fill? Does it advance or challenge existing theories related to crowdfunding or technology adoption models like TAM or TPB? This needs more explicit discussion.
2. The discussion on how theoretical findings translate into managerial strategies feels somewhat disconnected. For instance, how do concepts like internalization and social status practically translate into improving platform quality or design? Bridging this theory-practice gap with specific actionable steps would enhance the section's clarity and utility for practitioners.
3. Conclusions sections typically offer strong, final takeaways. In this case, the implications are somewhat repetitive and general (e.g., improve PQ, PU, and PEOU). The conclusion could benefit from a sharper summary of the most critical findings and their implications for future platform designs, regulations, or academic research.
4. The practical recommendations could be more detailed and targeted. For example, how should platform developers enhance the role of SI on their platforms? Can social networks be leveraged through specific platform features (e.g., referrals, social proof mechanisms)? Additionally, the section only briefly touches on demographic differences (e.g., male investors), without diving deeper into how these insights could inform segmented marketing or product development strategies.
5. While the section mentions ECF platforms in Thailand, it misses the opportunity to discuss the broader implications of the findings for other regions or for the field of financial innovation. Even if the study is specific to Thailand, some of the findings could be relevant to global crowdfunding platforms, which should be discussed in more depth.
6. While the need for further research is mentioned (particularly related to SI and platform characteristics), this section could better outline specific avenues for future investigation. For instance, what aspects of platform security or regulatory frameworks should future studies focus on? Could cross-country comparisons or longitudinal studies offer deeper insights into how social influence evolves in different cultural contexts?
Comments on the Quality of English LanguageOverall, the quality of English in the article titled "Financial Innovation and Crowdfunding: Influencing Investment Decisions in Tech Startups" is generally competent but could benefit from several improvements. While the language is clear and conveys the main findings effectively, there are occasional issues with redundancy, grammatical precision, and clarity. For example, some sections repeat similar information, which could be consolidated for a more concise presentation. Additionally, the text occasionally lacks the nuance needed for a scientific audience, such as precise theoretical contributions and practical implications. Addressing these issues would enhance both the readability and scholarly impact of the article.
Author Response
Please see all responses in the attachment.
Author Response File: 
Author Response.pdf
Reviewer 2 Report
Comments and Suggestions for AuthorsThe authors explored the financial behavior of Thai investors in equity crowdfunding, focusing on how various factors influence their investment intentions. Using the Information System Success Model, the Theory of Diffusion of Innovations, and Technology Acceptance Model 3, the research investigates platform quality, platform characteristics, and social influence as independent variables, with perceived usefulness and perceived ease of use as mediators. The paper is good and may be considered for publication after addressing all the below comments properly:
1. In the literature, there have been proposed many works in terms of Financial innovation and Equity crowdfunding. What is the novelty of this work? The authors must highlight this point.
2. I have gone through the introduction, which needs to be improved by including some recent significant research works on exact solutions.
3. I have noticed that commas and full stops are missing at the end of equations.
4. The captions of the graphs need to be changed.
5. Please demonstrate Figure 2 and discuss the peculiarities of Table 5 with this Figure. Please clarify it.
6. It would be better if the authors explained SI, PU, PEOU, and INI in the paper.
7. Authors must add the most recent papers doi.org/10.1140/epjp/s13360-023-04310-9, in the references list and the references style must be consistent.
8. One paragraph must be added in the introduction section regarding the importance of present research in the modern world.
9. Please improve the section 6.
10. It is recommended to check the typos and grammar throughout the present manuscript.
Comments on the Quality of English LanguageCan be improve
Author Response
Please see all responses in the attachment.
Author Response File: Author Response.pdf
Round 2
Reviewer 1 Report
Comments and Suggestions for AuthorsThe authors have addressed the comments adequately. I suggest that the paper can be published.
