Betting on the Horse, the Jockey or the Tips? Evidence from Blockchain-based Fundraising via Initial Coin Offerings

Initial Coin Offerings (ICOs), a novel fundraising form, allow blockchain-based ventures to issue crypto-assets in exchange for enormous amount of fund, with mere ideas in the conception stage, while without constraints of intermediaries or regulations. In this study, we develop a theoretical framework for how campaign profile, product quality, venture team characteristics, and expert ratings interrelate. Specifically, by establishing token sales as the primary ICO success measure, informational factors and the moderating role of expert ratings are proposed to investigate the underlying determinants affecting blockchain-based fundraising. By analyzing a dataset that consists of 4,183 ICOs from 2015 to 2020, we strive to clarify whether the investors should place more weight on the company (“the horse”), on the venture team (“the jockey”), or on the expert ratings (“the tips”). The research could promote the theoretical understanding of factors influencing ICOs, and help investors and entrepreneurs better appreciate the blockchain-based technology innovation.