ECSN & ExCL Research Seminar- "Signals for Distinct Decisions: Evidence from Equity Crowdfunding Platforms"

In prior research, signal receivers use signals primarily for singular decisions, mostly in selecting firms of unobservable quality for one investment, purchase or hiring decision. This paper examines the use of signals by platform decision-makers in their distinct gatekeeping (selective access) and brokerage (selective promotion) decisions. Adopting a cognitive perspective on signalling, we hypothesize that economic and social impact signals will differently affect gatekeeping versus brokerage decisions. Moreover, we hypothesize that the personal pro-social motivation of platform decision-makers will amplify the effect of social impact signals on their decision-making, especially in brokerage decisions, even when platforms do not have a social venture focus. We test our theory through a conjoint experiment involving decision-makers from equity crowdfunding platforms, who connect new firms with potential investors. Our study provides novel insights into how decision-makers utilize signals differently in their distinct decisions and how their personal motivations may influence decision-making beyond the focus of their employers.