Is there a gender gap in equity-based crowdfunding?

Compared to their male peers, female entrepreneurs tend to face greater obstacles in raising venture funding from business angels, venture capitalists, and financial institutions. In this paper, we investigate whether this gender gap also exists in equity crowdfunding. Based on data from the German equity crowdfunding market, we find that ventures with and without female managing directors are equally successful in raising capital when launching their first equity crowdfunding campaign. In contrast, the former are significantly less successful than their peers in seasoned equity crowdfunding campaigns, and this disparity cannot be fully explained by differences in other venture-related or entrepreneur-related characteristics. However, we also find that the gender gap in seasoned offerings narrows if female entrepreneurs set more ambitious funding thresholds. Overall, our results indicate that pitching their equity crowdfunding campaigns in a more promotion-oriented way is a sensible strategy for female entrepreneurs to improve funding success. Plain English Summary Equity crowdfunding enables female entrepreneurs to narrow the "gender gap" in venture financing. In this paper, we investigate whether the entrepreneurs' gender affects how successful they are in attracting capital in the German equity crowdfunding market. Our results indicate that the gender of a firm's managing director does not affect the funding outcome in initial equity crowdfunding campaigns. In seasoned equity crowdfunding offerings, though, we identify a gender gap in the sense that ventures with female managing directors are significantly less successful in raising capital from crowd investors than ventures solely led by men. However, this gender gap in seasoned offerings narrows for bolder campaign pitches. Hence, setting a higher funding threshold seems to be a simple and straightforward strategy for female entrepreneurs to increase the odds of reaching their funding targets.