The “C” in crowdfunding is for co-financing: exploring participative co-financing, a complement of novel and traditional bank financing

Davis (1986) initially developed the TAM intending to explain the determinants of computer acceptance of end-users on a theoretically sound and yet parsimonious basis. In subsequent studies, the TAM has been used to investigate any kind of information system in general. The primary objective is to trace the effects of internal beliefs and external variables on descendant behavioral intentions (Davis et al. 1989). Davis et al. (1989) derive the dependent variable behavioral intention from the theory of reasoned action (Ajzen and Fishbein 1980; Hill et al. 1977). Accordingly, the users’ behavior is a succession of their intentions to perform the behavior.

Internal beliefs are expressed through perceived usefulness and perceived ease of use, where the latter is mediated by the first (Davis et al. 1989). Davis (1989: 320) defines perceived usefulness as “the degree to which a person believes that using a particular system would enhance his or her job performance.” He defines perceived ease of use as “the degree to which a person believes that using a particular system would be free of effort” (Davis 1989: 320). However, perceived ease of use often only affects behavioral intentions through perceived usefulness. Several literature reviews observe that perceived usefulness has a much stronger effect than perceived ease of use (Davis 1989; Legris et al. 2003). Therefore, “[i]f one could measure only one independent variable, perceived usefulness would clearly be the one to choose” (King and He 2006: 746).

The TAM constitutes that external variables affect perceived usefulness and perceived ease of use (Legris et al. 2003). One of the TAM’s strengths is that external variables are a fixed component of the model, enabling flexibility and adjustability by opening up for features and capabilities specific to a particular system (Marangunić and Granić 2015). Among the most frequently considered external variables is the moderating effect of experience (King and He 2006; Legris et al. 2003; Venkatesh 2000).

Considering the novelty of participative co-financing, we must adjust the setting of the TAM to fit the context of our study better. Participative co-financing has not yet been used often enough to provide empirically reliable data. However, behavioral intention has proven to be a reasonably good predictor of actual system use (Davis et al. 1989). Therefore, in the context of this study’s goal, we employ the TAM to provide implications about the decision-makers’ acceptance of participative co-financing.

Established variables that reflect internal beliefs about participative co-financing at a pre-integration stage do not exist yet. Therefore, we make the necessary adjustments to employ potentials that reflect internal beliefs and eventually help predict intentions to offer participative co-financing. Marangunić and Granić (2015) remark that the adjustments of the TAM to the systems’ specific needs are common. At the time of this study, participative co-financing is only at a conceptual stage, and actual integrations into regional banks’ business models have not yet taken place. Hence, approaching end-users as initially conceived in the TAM is impossible. The decision about the trial, integration, and offer of participative co-financing is a strategic decision. Consequently, instead of examining end-users, we can only examine the intention of decision-makers who account for the strategic decision to offer participative co-financing.

The TAM predicts behavioral intentions for already employed information systems based on internal beliefs and external variables. Withal, many variables of the TAM are unknown, and future research is needed to uncover them; after all, they depend on the context in which the model is employed (Davis 1989). In the context of participative co-financing, behavioral intentions to use or offer this financing technique might depend on the type of crowdfunding. In our case, internal beliefs that influence perceived usefulness and perceived ease of use are likely to differ from already acquainted systems. We claim that potential synergies are perceived as useful since they enhance the banks’ business model by increasing the models’ efficiency. Potential target groups are perceived as useful since they enhance the banks’ performance by offering their business processes to new customers. For instance, decision-makers might perceive participative co-financing as useful since an integration enables the banks to enhance their established values by offering related products to crowdfunding investors, by signaling openness to innovation, and by addressing a broader range of customers. The regional banks’ natural background in financing might enable them to utilize potential synergies with minimum effort. Thus, some potential synergies might add to perceived ease of use. For example, the banks’ core know-how is in financing. Thus, decision-makers might perceive using participative co-financing as easy (Davis 1989). In contrast to the TAM in its genuine form, we investigate variables of belief before the actual use to better understand how to improve the acceptance of participative co-financing in an early phase.

While the concept of participative co-financing is new, crowdfunding has been a prominent phenomenon since the late 2000s (Mollick 2014). Some banks have already gathered first experiences with crowdfunding. The TAM offers an established model to consider experiences as an external variable to examine the influence on behavioral intention (e.g., Legris et al. 2003).

Finally, participative co-financing is a digital technique indeed, but it goes beyond simple software automation. Thereby, it surpasses the original purpose of the TAM. Legris et al. (2003) demand employing the TAM in a business process application context to advance the model. We stress the character of participative co-financing being a business process information system by pointing out that multiple vendors offer white-label crowdfunding software already (e.g., portagon GmbH 2022). These software solutions enable efficient testing and integration of crowdfunding techniques into the banks’ business processes.

The key characteristics of crowdfunding are general characteristics (Fig. 2, middle), which we use to compare crowdfunding with regional banking. The primary function of crowdfunding is financing (“for-finance”) by pooling financial resources from a group of voluntarily participating investors (Schwienbacher and Larralde 2010). The exact financing process depends on the platform’s crowdfunding type and operative integration, such as the all-or-nothing principle (Mollick 2014). We summarize the resulting specifications on the type level in the next section.

Crowdfunding is purpose-specific (Böckel et al. 2021). By being purpose-specific, crowdfunding allows investors to participate in a dedicated cause that is valuable from the investors’ perspective. Henceforth, we refer to those who initiate a campaign as entrepreneurs (e.g., Mollick 2014). Entrepreneurs are trusted to use the capital raised only for the sole purpose presented in the campaign (Agrawal et al. 2014). After all, the purpose is the motive for why investors decide to give their money. The misuse of capital leads to the corruption of trust in the effectiveness of crowdfunding. Mollick (2014) and Cumming et al. (2020) investigate the frequency of fraudulent crowdfunding campaigns and find that fraud rarely happens and often cannot be distinguished from entrepreneurs who struggle to meet their obligations. However, effectiveness and trustworthiness are of existential importance for reputable entrepreneurs and platform operators (Cai et al. 2021; Chen et al. 2014).

Crowdfunding is participative since, on crowdfunding platforms, the crowd receives the opportunity to participate. Most crowdfunding platforms’ stated goal is to give as many people as possible the opportunity to participate (Schwienbacher and Larralde 2010). Restrictions and constraints usually depend on the crowdfunding type, the platforms’ way of conduct, or legal obligations. Platforms also enable communication about a campaign (Cai et al. 2021; Liang et al. 2020). The entrepreneurs of a campaign communicate their ideas, goals, conditions, and requirements. The crowd has the opportunity to ask questions, make comments, and exchange thoughts with each other (Bretschneider and Leimeister 2017). Research shows that the success of campaigns depends significantly on how well entrepreneurs and the crowd communicate (e.g., Allison et al. 2015; Block et al. 2018; Kim et al. 2016; Lee et al. 2019; Pietraszkiewicz et al. 2017; Thies et al. 2016). Participation is possible due to communication and the free choice of how much someone wants to contribute.

Crowdfunding is digital (Belleflamme et al. 2014). Since crowdfunding is a phenomenon of the internet, it is possible to participate in a campaign regardless of the time and location, as digital crowdfunding compensates for geographical limitations (Kang et al. 2017). This characteristic holds the potential for entrepreneurs to achieve a great outreach to possible investors. Therefore, entrepreneurs can reach investors from regions that, without digital technologies, could not be reached and convince them to participate.

The digital foundation of crowdfunding also emphasizes the compelling impression that it is an innovative technique (Jovanović 2019; Walthoff-Borm et al. 2018). Advanced customer-centricity, which digitization and crowdfunding enable, allows for an innovative and market-oriented approach between participating entrepreneurs and investors. The market orientation of crowdfunding (Chan et al. 2019), in turn, is perfect for testing product legitimacy. Additionally, the campaigns themselves reinforce the impression that crowdfunding is innovative. Often the products presented in crowdfunding campaigns are highly innovative, and their legitimacy has yet to be proven (Kim et al. 2016). Eventually, digitization, emphasized through crowdfunding, promotes an innovative and market-oriented approach.

Crowdfunding is market-oriented, which is expressed in the possibility that campaigns are usable as a marketing tool to promote the campaign’s purpose (Xu et al. 2018). This purpose can be a product, service, action, or initiative (Messeni Petruzzelli et al. 2019). In this way, crowdfunding attracts attention and, if well designed, creates interest and the desire to participate. Furthermore, crowdfunding serves as a laboratory to test the acceptance of innovative concepts (e.g., Lam and Law 2016; Laurell et al. 2019; Vismara 2019). After publishing an idea on a platform, the market (the crowd) can analyze and evaluate the product. In doing so, it is possible to determine the balance between supply and demand, which is particularly beneficial for innovative products where demand is difficult to predict (Xu et al. 2018). The more value investors assign to an idea, the higher the support a campaign receives.

Currently, two classes of participative financing with a total of four crowdfunding types can be distinguished (Fig. 2, left) (De Buysere et al. 2012; Kirby and Worner 2014). First, non-financial-return crowdfunding offers a material or sentimental value to investors in return for their financial support (De Buysere et al. 2012; Lam and Law 2016; Messeni Petruzzelli et al. 2019). This class can be divided further into reward- (1) and donation-based (2) crowdfunding. Second, financial-return crowdfunding offers a monetary return or company shares to investors in return for their investment (Kirby and Worner 2014; Lam and Law 2016). This class can be divided into lending- (3) and equity-based (4) crowdfunding, also referred to as crowdlending and crowdinvesting (De Buysere et al. 2012; Kirby and Worner 2014). Belleflamme et al. (2015) summarize the main characteristics of the different types: In reward-based crowdfunding, investors are often early adopters or prosumers interested in acquiring a product or service as early as possible. In donation-based crowdfunding, investors mainly invest to support a non-profit or humanitarian cause for voluntary, community-oriented, and altruistic reasons. In lending-based crowdfunding, investors grant a credit to a private individual or organization to receive interest for their support. In equity-based crowdfunding, investors become shareholders through their investment and thus participate in the value creation of their investment. The five key characteristics apply to all four types. The specifications of the types’ characteristics are relatively similar within one class but differ between the two classes. Although we only consider financial-return crowdfunding as this class is most comparable with established bank financing, knowledge about non-financial-return crowdfunding is necessary for reasons of better differentiability.

The key characteristic for-financing holds many specifications based on which the classes and types can be distinguished, such as volume (1), return (2), risk (3), and regulations (4) (Beaulieu et al. 2015; Cicchiello et al. 2020; Jovanović 2019; Shneor et al. 2020). Research shows that the investment volume (1) is generally higher in financial-return crowdfunding (Shneor et al. 2020). In financial-return crowdfunding, a mandatory minimum investment is typical (Messeni Petruzzelli et al. 2019). Also, the purposes for which entrepreneurs seek capital in financial-return crowdfunding often require higher investments than non-financial-return crowdfunding (Belleflamme et al. 2014).

Obviously, the type of return (2) represents one of the most evident differences. While for financial-return crowdfunding, the return can either be a monetary interest or the share of an asset. For non-financial-return crowdfunding, the return can be materialistic or idealistic (De Buysere et al. 2012; Kirby and Worner 2014).

The investors’ individual risk (3) increases with the amount of their investment. The risk involved in financial-return crowdfunding is considerably higher than for non-financial-return crowdfunding (Beaulieu et al. 2015). However, many financial-return crowdfunding platforms have established assessment processes to evaluate the quality of campaigns ahead of time to mitigate the risk of losing investments (e.g., Companisto 2021b). Additional risk arises for investors who are unsophisticated (Allison et al. 2017). Also, entrepreneurs who utilize financial-return crowdfunding might be more sophisticated than entrepreneurs who use non-financial-return crowdfunding. The entrepreneurs’ sophistication, experience, and education also significantly impact the risk of an investment.

In recent years, lawmakers have developed regulations (4) to protect investors and increase the credibility of crowdfunding. In Germany, financial-return crowdfunding campaigns must publish an asset information sheet (German: Vermögensanlage Informationsblatt) (§ 13 Abs. 1 VermAnlG 2012). This regulation obliges entrepreneurs to disclose certain information in a mandatory format. Regulations in financial-return crowdfunding provide security but also lead to increasing complexity. In addition, the design of the regulations is subject to national legislation. The market of non-financial-return crowdfunding is relatively deregulated and is governed mainly by the civil code (German: Bürgerliches Gesetzbuch) (Rockel et al. 2020).

Crowdfunding campaigns serve a specific purpose. While both classes can serve profit-oriented and non-profit purposes, roughly, in financial-return crowdfunding, the purpose is mainly profit-oriented (Beaulieu et al. 2015). In contrast, although non-financial-return crowdfunding often serves a commercial purpose, it likely has a non-profit purpose or common welfare as an objective (Jovanović 2019). The purpose depends on the target group since a campaign, for example, in a startup context serves a different purpose than a campaign for a cultural initiative. It is relevant for banks to determine which target groups they want to address by offering participative co-financing.

To enable participation, crowdfunding platform operators developed various methods which allow entrepreneurs and investors to communicate. A common practice for all types is a comment- or question-and-answer-section on the campaign website (Bretschneider and Leimeister 2017; Cai et al. 2021; Liang et al. 2020). While providing an informative video is good practice for all types (Mollick 2014), a trend towards live video webinars is observable on financial-return crowdfunding platforms (e.g., bettervest 2021; Companisto 2021a). Such videos increase trust and allow viewers to engage in a conversation with entrepreneurs and fellow investors. Platforms can increase the level of participation even further through active communication.

The more sophisticated a campaign becomes, the more sophisticated investors need to be. Likely, investors who participate in financial-return crowdfunding have more profound knowledge about the assessment of ventures and the risks involved than investors who invest in non-financial-return crowdfunding.

In terms of the digital key characteristic, classes and types do not differ significantly. All types have in common that they are market-oriented since they need to legitimize their campaign and prove that customer demand exists (Chan et al. 2019; Kim et al. 2016). Especially non-financial-return crowdfunding is customer-centric since digital communication helps to integrate customer feedback easily (Gomber et al. 2017). Also, in non-financial-return crowdfunding, investors often are customers as well. This aspect is even more critical for financial-return crowdfunding since their financial specifications require more sophistication than established products.

Crowdfunding types differ in terms of market orientation by the number of parallel campaigns and co-existing platforms, resulting in competition (Belleflamme et al. 2015; Dushnitsky et al. 2016). Competition is much higher in non-financial-return crowdfunding due to more simultaneously running campaigns. To stand out from the competition, campaign creators must be more market-oriented than their competition. This competitive advantage is achievable through a superior marketing strategy or a product with a superior value-add.

Regional banks have common interests with crowdfunding, which is the prerequisite for identifying intersections of both systems. Over the past centuries, regional banks have developed a comprehensive portfolio of products and services, exceeding crowdfunding (Deutscher Sparkassen- und Giroverband 2019). We identify commonalities by analyzing regional banks based on the five key characteristics of crowdfunding (Fig. 2, right).

In terms of the for-finance characteristic, the banks’ core business is the management of savings accounts with low interest rates as well as credit-based financing (Deutscher Sparkassen- und Giroverband 2019). Therefore, regional banks have great experience in assessing creditworthiness (Deutscher Sparkassen- und Giroverband 2019). Their experience with implementing the Third Basel Accord, which was a reaction to the 2008 financial crisis, contributes to their expertise (Jovanović 2019). The Third Basel Accord affects banks in multiple ways, for example, how banks manage the risks of their assets, the equity ratio they need to obtain for granting credits, and transparency requirements (Domikowsky et al. 2012).

Regional banks support their region and community by providing purpose-specific credits for private customers and credits to regional companies as well as public institutions (Deutscher Sparkassen- und Giroverband 2019). Therefore, regional banks are essential for communal economies (Flögel and Gärtner 2018). Many regional banks enjoy the image of supporting purposes that are long-lasting, trustworthy, and valuable to the community (Deutscher Sparkassen- und Giroverband 2019).

In terms of participation, regional banks do typically not offer products that allow participation explicitly. Financial products issued by regional banks with a participative character are profit participation rights. These participation rights are often only temporary and limited to one project (Peter et al. 2012). However, regional banks have a strong connection to their community (Flögel and Gärtner 2018). Before digitization made physical automated teller machines (ATM) obsolete and electronic payment services became popular (Gomber et al. 2017), a close net of the banks’ decentralized subsidiaries provided cash money and financial services to whole communities (Flögel and Gärtner 2018). Often generations of families were customers of the same bank, which supported the families in smaller and larger purchases. Although banks have not yet enabled participation in a democratic sense, they have contributed significantly to the development of their communities, facilitating their customers to participate in their region’s economy.

Digitization presents an immense challenge, especially for smaller banks. Due to digitization, geographic constraints erode, causing decentralized regional banks to lose their communal connection (Giebe and Schulz 2021). Furthermore, in contrast to the many glamorous fintech startups, regional banks often seem stubborn and slow to adapt to innovations. These developments put regional banks under pressure to innovate their business models and offer new digital services.

Regional banks are highly market-oriented (Flögel and Gärtner 2018). They have a significant advantage due to their network of subsidiaries with competent bank advisors who know their customers. Banks can observe the mood of regional markets through their advisors and reach out to customers to identify demands.

Potentials emanate at the intersection of crowdfunding and regional banks (Fig. 2, upper right). By integrating participative co-financing into the banks’ business model, these potentials can “enhance [the banks’] performance” (Davis 1989: 320), improve the product portfolio, and boost the perception of the banks’ customers (Davis 1989). Banks can take advantage of these potentials if decision-makers perceive them as useful. We distinguish between potential synergies (2.5.1) and potential target groups (2.5.2). Potential synergies emanate at the intersection of the crowdfunding information system and the established information system of regional banks. Decision-makers might perceive participative co-financing as useful. Integrating participative co-financing in the banks’ value creation might enhance their performance, enable them to offer related products to the social network of the crowd, or signal openness for innovation. Offering participative co-financing might also be perceived as useful since it enhances the banks’ capability to finance target groups that banks cannot address with established financing techniques.

While some potentials are creatable by integrating participative co-financing, other potential synergies come as a byproduct. The latter may be perceived as easing the use of participative co-financing since these potentials are “free of effort” (Davis 1989: 320). Banks can make already existing know-how available for participative co-financing with almost no effort (Fig. 2, lower right). Therefore, decision-makers may perceive that existing know-how eases the use of participative co-financing.

Participative co-financing enables banks to use existing know-how and complement existing know-how. First, one possibility is to transfer know-how about the design of credits to the design of crowdfunding campaigns. This aspect is especially true for financial-return crowdfunding campaigns. Second, banks are experienced and trained in providing trustworthy financial advice. The banks’ know-how consists of financial expertise and knowledge about customer needs. Banks can enhance and expand their advisory expertise by adapting their know-how to participative co-financing. This adaptation benefits their financial investment consulting. Third, in line with the increased requirements for credit- and risk-management due to regulations, participative co-financing offers several opportunities to enhance and expand their risk-management expertise (Ahn and Le 2015; Chiorazzo et al. 2018; Diener and Špaček 2021). Capital acquired by using participative co-financing can be used to test the economic viability of a risky venture before granting high amounts of money. Before giving a credit, conducting a crowdfunding campaign helps to assess the market fit. A combined approach could improve the banks’ risk assessment (Xu et al. 2018). Additionally, participative co-financing makes it possible to finance risky projects that would not receive a credit under normal circumstances by sharing the risk between the bank and the crowd (Salzmann 2013). Providing one portion of financing through the crowd reduces the need for debt capital from banks. The lower credit volume reduces the requirements that need to be met and lowers the equity capital contribution to be made by banks. The potential that results from the synergetic use of existing know-how and the possibility of reducing uncertainties can affect the decision-makers’ intention to offer participative co-financing.

While “perceived ease of use” could be influenced by other potentials, the effect of this latent variable remains unclear. As several researchers note, the effect of perceived ease of use is regularly much smaller compared to perceived usefulness (e.g., Davis 1989; King and He 2006; Legris et al. 2003). In particular, since participative co-financing is so novel, there may be much ambiguity about potentials that arise as a byproduct and are useable effortlessly. Nevertheless, in line with the theoretical construct of the TAM, we propose that perceived ease of use increases the decision-makers’ acceptance of participative co-financing (Davis 1989). Furthermore, perceived usefulness mediates the effect of perceived ease of use on the acceptance of participative co-financing (Davis 1989). We claim the following hypotheses.

External variables provide a better understanding of internal beliefs and allow determining variables that improve the acceptance of participative co-financing (Legris et al. 2003). In the context of research evolving around the TAM, the effect of the external variable experience has been investigated frequently. For example, Burton-Jones and Hubona (2006) find a strong effect of system experience on usage.

It is assumable that decision-makers whose banks already employed crowdfunding in a business-related context are likely to assess participative co-financing differently than their inexperienced counterparts (Pennings and Harianto 1992). Experienced decision-makers will already have spent their first thoughts on potential applications of combined financing through crowdfunding and traditional banking. Their experiences may also help to settle initial preconceptions about crowdfunding. Experience with crowdfunding helps decision-makers to better asses how participative co-financing can enhance the banks’ performance and how much effort is needed to implement participative co-financing. We claim that experiences reduce preconceptions and facilitate the anticipation of potential synergies. Therefore, experience positively affects perceived usefulness and perceived ease of use. We propose the following hypotheses.

We aim to explore which type of financial-return crowdfunding regional banks prefer in a participative co-financing context. To this end, we operationalize the decision-makers’ intention to offer that particular type of crowdfunding in a co-financing context for each of the two types of financial-return crowdfunding. To derive our dependent variable, we asked: What is your intention about how reasonable it is for [your bank] to offer a co-financing model consisting of lending-based crowdfunding and established credit financing? We repeat the question for equity-based crowdfunding. The decision-makers’ intentions are measured utilizing a five-point Likert scale. The variables we obtain represent our dependent variables: Lending-based co-financing and Equity-based co-financing. They express the decision-makers’ intention to use either one of the two types of financial-return crowdfunding in combination with established bank financing.

We measure perceived usefulness based on three potential synergies and four potential target groups, according to the potentials identified in 2.5.1 and 2.5.2. We operationalize these potentials as variables that reflect perceived usefulness. Accordingly, potential synergies which reflect perceived usefulness are the possibility to use participative co-financing for (1) cross-selling, to (2) foster the local community, or to (3) be perceived as innovative. Regardless of the type of crowdfunding used, we ask: How strongly do you agree with the following aspects about offering crowdfunding types for your [bank]? We measured the decision-makers’ answers on a five-point Likert scale. This assessment results in the three reflective variables cross-selling, foster community, and perceived innovative.

We identify four target groups: (1) startups, (2) cultural initiatives, (3) small and medium-sized companies, and (4) individual persons. We measure the possibility of addressing potential target groups as variables reflecting the perceived usefulness of participative co-financing. We ask: How suitable do you consider financing one of the following target groups with a co-financing model of crowdfunding and credit financing offered by the [bank]? We provide decision-makers with five-point Likert scales to rate the suitability of each potential target group, regardless of the crowdfunding type. We represent each target group (TG) by an accordingly named reflective variable: TG startups, TG SMEs, TG individuals, and TG cultural initiatives.

We construct our scaled independent variable of perceived usefulness based on these seven variables. To determine the scale reliability, we calculate Cronbach’s Alpha. We receive a value of α = 0.804, representing good reliability of our construct (Nunnally et al. 1994).

Research shows that investors on crowdfunding platforms are 39 years old on average and male (Klöhn and Hornuf 2012). To consider general demographic information, we control for the informants’ Age and Gender, where men are coded as one. Since some decision-makers passed on the survey to respective experts within their organization, we control for the informants being actual decision-makers in leadership positions. We, therefore, introduce the binary variable Leader, which is coded as one if informants report being leaders.

We display the results of our descriptive statistics and correlations matrix in Table 1 and Table 2. Figure 4 presents graphs that delineate the informants’ business-related experience and demography. Figure 5 visualizes the intention to offer participative co-financing for each of the two types of financial-return crowdfunding. We conduct a twofold analysis by looking at the direct effects of potentials first and acceptance according to the TAM second. Thereby we look at lending-based and equity-based crowdfunding separately. Figure 3 adapts the original TAM and picks up on our research framework presented in Fig. 2. Thereby, Fig. 3 depicts the emanating potentials that reflect the respective constructs of the TAM and illustrates our statistical analysis.

First, we analyze the direct effects of all variables by employing a robust OLS regression. We display these results in Table 3 (models D1 to D10). We propose five models per dependent variable, one with control variables only (D1, D6), one with potential synergies which reflect perceived usefulness (D2 and D7), one with potential target groups which reflect perceived usefulness (D3 and D8), one with existing know-how reflecting perceived ease of use (D4 and D9), and finally, one with the external variable of experience reflected by the variable bank served CF (D5 and D10). We recalculated the same models using an ordered logistic regression to test our results for robustness. We show the results of the robustness calculations in Table 6 in the Appendix. Also, we analyze the interaction of experience with all direct effects. We display only the significant interactions in Table 4 (models E1 to E6).

Second, we design statistical models according to the TAM (Table 5, models TAM1 to TAM10). Once more, we employ robust OLS regressions to test our models. To investigate the mediating effect between perceived usefulness and perceived ease of use according to hypothesis 2b, we create the models TAM1 and TAM2. In line with hypotheses 1 and 2a, we test the direct effect of both internal beliefs on the intention to offer either of the two crowdfunding types (TAM4 and TAM8). We also test the moderating effect of experience on the relation of perceived usefulness and perceived ease of use on the decision-makers’ intention to offer participative co-financing according to hypotheses 3a and 3b (TAM5, TAM6, TAM9, and TAM10).

We begin with discussing potentials that reflect usefulness and therefore affect the intention to offer participative co-financing. While both types of financial-return crowdfunding are closely related, we find that the same variables affect each type differently. Regarding potential synergies of lending-based co-financing, we find that being perceived as innovative and enabling cross-selling are significant variables.

The potential for cross-selling has a significant effect on the intention to offer lending-based co-financing. This effect could be explainable with crowdfunding being perceived as a marketing tool (Xu et al. 2018). Additionally, crowdfunding enables an extensive outreach to potential customers, thereby enabling to sell products to the crowdfunding participants. Participating in crowdfunding is especially popular among younger people (Klöhn and Hornuf 2012; Ramos and Gonzalez 2016). Hence, a more youthful customer segment may be reachable. Decision-makers might hope to profit from cross-selling to a young customer segment by offering participative co-financing.

The observation that decision-makers see in lending-based co-financing the potential of being perceived as innovative may just be an indicator of the obvious: namely, that participative co-financing is an innovative technique (Jovanović 2019; Walthoff-Borm et al. 2018). Moreover, this effect reflects that decision-makers perceive participative co-financing as innovative themselves. Further, the effect fits the motivation of this study. A core motivation is to support regional banks in pursuing an innovation strategy that enhances their strengths. The observation suggests that decision-makers would consider participative co-financing as part of their innovation strategy.

However, it remains unclear whether decision-makers understand participative crowdfunding as a technique to enhance their strengths. We observe that the potential to foster the community does not significantly affect the intention of decision-makers. The low importance of communal orientation raises questions in two directions. First, it is questionable whether regional banks understand crowdfunding mechanisms well enough to assess the added value that the participative character of crowdfunding offers, for example, for their community. On the other hand, it is questionable how connected regional banks feel with their region. We suspect that regional banks have not yet recognized the potential of civic crowdfunding to foster their community (Lee et al. 2019).

Regarding potential synergies of equity-based co-financing, we find that only being perceived as innovative has a significant effect, likely for the same reasons as for lending-based co-financing. Again, fostering the community is not seen as a relevant potential. Since regional banks focus on credit financing, we assume that equity-related products are not in their portfolio, impeding the potential to enable cross-selling.

Next, we discuss potential target groups for both types of financial-return co-financing. Our results show a significant effect to offer lending-based co-financing to three target groups. The target groups individual persons, startups, and SMEs have a significant positive effect on the intention to offer lending-based co-financing. All three target groups have in common that they are economically oriented. In comparison, cultural initiatives are often non-profit-oriented or do not necessarily pursue an economic interest. The results indicate that decision-makers prefer economically oriented target groups for participative co-financing. Presumably, decision-makers expect a higher own profit from targeting these groups. The risk expectations of startups seem to play a minor role for decision-makers since startups have a significant effect, although a high default risk is assumable for startups. Therefore, startups are usually rather unsuitable for credit financing. The fact that startups significantly affect the intention to offer lending-based co-financing is surprising because banks typically do not provide risk capital for startups. Nevertheless, apparently, decision-makers share their assessment of the suitability of crowdfunding for startups with the existing literature on crowdfunding (e.g., De Buysere et al. 2012; Paschen 2017).

The observation that cultural initiatives are seen as an unsuitable target group is consistent with the observation that fostering the community is not seen as a potential for participative co-financing. After all, cultural initiatives are often projects organized to benefit a community and thus promote community life but have no explicit profit orientation. Even if the overall result is consistent, it is surprising that the potential for strengthening regional orientation through participative co-financing is not considered as relevant by regional banks. After all, regional banks are essential for their local economies (Flögel and Gärtner 2018) and also have a commonwealth-orientation (Deutscher Sparkassen- und Giroverband 2019; Manger-Nestler 2020). The fact that cultural activities have no significant effect on the decision-makers’ intention contradicts our expectations. For example, Allison et al. (2015) and Moon and Hwang (2018) discovered a positive relation between crowdfunding and cultural or prosocial initiatives. The observation might suggest that for many regional banks, regional orientation has a secondary rank.

In the context of equity-based co-financing, it is not surprising that decision-makers do not consider individuals and cultural initiatives as suitable. Financing these groups with equity is unconventional. In contrast, financing companies with equity is prevailing. Therefore, it is not surprising that startups are considered as a significant target group. However, it is questionable why decision-makers do not consider SMEs as a suitable target group financeable with equity-based co-financing. Especially since empirical data on this form of equity-based financing are scarce (Eldridge et al. 2021), this observation opens up opportunities for future research.

Summarizing our findings about potential target groups, high relevance is attributed to startups in the context of financial-return co-financing. Surprisingly, decision-makers only attribute little relevance to financing cultural initiatives with participative co-financing. Furthermore, in the context of equity-based co-financing, SMEs are not considered as a significant target group. These findings contrast with the potentials we describe in chapter 2. This observation leads to the assumption that many decision-makers do not yet have a clear idea of the potentials of participative co-financing.

Regarding the simulation of the TAM, we measure perceived usefulness based on potential synergies and potential target groups. We develop a reliable construct of perceived usefulness as indicated by our high Cronbach’s Alpha. We claim our hypothesis 1 according to the TAM. We predict that the perceived usefulness of financial-return co-financing positively affects the intention to use this new financing technique. As expected, supporting our hypothesis, our results indicate a positive effect of perceived usefulness on the intention to offer either lending- or equity-based co-financing.

By exploring the direct effects of all variables reflected in the construct, we find positive relations for all variables, but only significant effects for some variables, providing a deeper understanding of how to improve the banks’ acceptance of participative co-financing. The results suggest that decision-makers generally accept this novel financing technique. We conclude that decision-makers perceive participative co-financing as a useful technique that enhances organizational performance.

We operationalize existing know-how to measure perceived ease of use. For both types of financial-return crowdfunding, we receive significant positive effects for perceived ease of use on the intention to offer participative co-financing. Based on these direct effects on the decision-makers’ intention, we conceive that existing know-how facilitates the integration of participative co-financing by reducing respective efforts. However, we also are surprised about the strong effect of existing know-how on equity-based co-financing since regional banks regularly lack know-how in equity financing (Jovanović 2019). We suspect this observation may also induce uncertainty among decision-makers about the actual applicability of their existing know-how to crowdfunding.

However, according to the TAM (Davis 1989), our results achieve the expected effect by confirming a positive effect of perceived ease of use on the intention to offer this novel financing technique, in line with our hypothesis 2a. Also, supporting our hypothesis 2b, according to the prediction of the TAM, perceived usefulness partially mediates existing know-how. We conclude that existing know-how positively contributes to the acceptance of participative co-financing by reducing the effort of integration.

Finally, we observe that the effect of perceived ease of use decreases when combined with perceived usefulness. This observation is particularly evident in the model TAM4. With our observation, we confirm the findings of previous studies, namely that the effect of perceived ease of use is regularly much smaller compared to perceived usefulness (e.g., Davis 1989; King and He 2006; Legris et al. 2003).

The results of the regressions in Table 4 show that business-related experiences, which we operationalize through a binary variable indicating whether a bank has already served a crowdfunding campaign, play a significant role in the intentions about participative co-financing. According to the results in Table 4, experience affects lending- and equity-based co-financing similarly by moderating the assessment of potentials positively. Experience moderates the same independent variables for both dependent variables.

Apparently, experienced decision-makers have a stronger sense of being perceived as innovative by offering participative co-financing than their inexperienced counterparts. This observation might indicate that experience even increases the belief about crowdfunding being an innovative technique, only reinforcing the usefulness, instead of dissolving too high expectations. Further, experienced decision-makers are reassured to offer participative co-financing to startups. Therefore, their former experience might encourage them to address startups as part of their own co-financing business model.

Eventually, we are surprised to find a positive effect of experience on targeting cultural initiatives. Recalling the results from our analysis of potential target groups in Table 3, we did not reveal a significant relationship between targeting cultural initiatives and participative co-financing. However, experienced decision-makers seem to reconsider how cultural initiatives can benefit from participative co-financing. We interpret this finding as a sign of decision-makers realizing the potentials of crowdfunding for communities as described in 2.5.2 (Lee et al. 2019). We analyze the non-significance of the direct effect of targeting cultural initiatives on participative co-financing as a lack of knowledge. The significant interaction between targeting cultural initiatives and experience can be interpreted as a sign of learning about the potentials of crowdfunding for communal and cultural orientation. Therefore, enabling decision-makers to gather experiences will be essential to advancing the regional banks’ perspective on participative co-financing.

Regarding the TAM, in our hypotheses 3a and 3b, we claim a positive moderating effect of experience on the relation of both internal beliefs on the decision-makers’ behavioral intention. We do not find any significant interaction of experience and perceived ease of use against our predictions according to hypothesis 3b. In terms of perceived usefulness and experience, we find diverging results compared to the separately analyzed potentials in Table 4. For lending-based co-financing, the separately analyzed potentials reveal a moderating effect of experience on the potentials of being perceived as innovative, for startups, and for cultural initiatives as potential target groups. Therefore, according to our hypothesis 3a, we would expect a significant interaction between experience and perceived usefulness in the context of lending-based co-financing. However, we find no support for hypothesis 3a in the context of lending-based co-financing. We attribute the divergence to the constructed constitution of perceived usefulness. Since perceived usefulness combines multiple variables, the effects of variables likely offset each other. Therefore, separately analyzing direct effects helps to better understand the effects of reflective variables of perceived usefulness.

Nevertheless, while the results show no significant moderation of experience for lending-based co-financing (no support for hypothesis 3a), we find significant moderation of perceived usefulness through experience in an equity-based context (support for hypothesis 3a). We interpret these findings as an indication of experience functioning as a catalyst for innovative thinking. By innovative thinking, we mean that decision-makers leave their accustomed thinking patterns behind to open up for new ideas like equity financing in regional banking. Conclusively, although interaction effects as predicted in the TAM are not as ambiguous as for the direct effects, experience positively affects the intention to offer participative co-financing.

Digitization has reached a level of maturity that involves much more than just mirroring formerly analog processes with software. At today’s stage of digitization, information systems are useable to exploit new business processes and augment the value creation of business models. We aim to account for the business process and business model perspective, which decision-makers must consider before coming to a strategic decision. We surpass the original purpose of the TAM, to explore the acceptance of software that enables entirely new business processes of value creation (Legris et al. 2003).

We employ the TAM to explore the acceptance of participative co-financing even before its extensive integration into regional banks’ businesses, as suggested by Legris et al. (2003). To this end, we do not approach users but decision-makers who decide whether to trial and integrate this technique. We consider this adjustment to be appropriate in order to predict the decision on the development of an innovation strategy. We contribute to the advancement of the TAM by employing it in a pre-integration context to predict the strategic decision on a management level.

We deviate from the original items employed to measure perceived usefulness by determining a construct of potential synergies and potential target groups. We undertake these adjustments in line with Marangunić and Granić (2015) and Davis (1989), who claim that adjustments regarding the variables to better suit the system’s specifications are common. While we rely on the general concept of the TAM, in our study, we rely on variables that better reflect the specifications of participative co-financing in the sense of emanating potential synergies.

Our findings are consistent with the predictions of the TAM. We find that perceived usefulness and perceived ease of use have a positive effect on the intention of decision-makers. Additionally, we observe a partial mediation of perceived ease of use through perceived usefulness. Our observations support the evidence that perceived usefulness is the stronger predictor compared to perceived ease of use (Legris et al. 2003). Furthermore, in terms of our external variable of experience, we find a positive effect on the decision-makers’ intention. Especially in our context, where there have not yet been many opportunities to gather experience, we would like to emphasize the importance of experience in order to mitigate unacceptance at an early stage. Eventually, offering participative co-financing enables regional banks to draw on the financial capital of their regional stakeholders and source their social capital as well (Cai et al. 2021).

According to our findings, the optimal participative co-financing model from the perspective of regional banks would be to offer lending-based co-financing. Also, regional banks are inclined to address individual persons, startups, and SMEs as target groups; only experienced decision-makers are likely to consider cultural initiatives as well. By offering this financing technique, decision-makers hope to profit from cross-selling and from being perceived as innovative. We are surprised to find that offering participative co-financing to the local community to foster it and enable cultural activities has not received significant support from decision-makers. We expected especially high support for so-called civic crowdfunding because of the banks’ objective to support their communities and their regional proximity to local customers (Ahn and Le 2015; Deutscher Sparkassen- und Giroverband 2019; Flögel and Gärtner 2018). This observation poses the question of the extent to which banks consider themselves responsible for their region. On the other hand, banks need to reason economically and thus prefer target groups that likely bring positive financial returns. The positive influence of experience on the intention to offer some form of crowdfunding is an encouraging finding.

We find, generally, decision-makers seem to be open-minded towards crowdfunding and would accept integrating it. However, our findings also indicate that many decision-makers have not yet fully understood the potentials of participative co-financing. We assume that before regional banks integrate participative co-financing into their innovation strategies, decision-makers must gather more experience. Therefore, we appeal to scholars and practitioners to conduct pilot projects in order to gather more experiences and enable stakeholders from banks and platforms to better assess the potentials of participative co-financing.

The internet promotes the trend towards democratization (e.g., the democratization of knowledge, software, product evaluations, choice of socialization, and free expression). Crowdfunding offers a suitable technique to democratize financing and societal decision processes. If regional banks enable democratic processes through participative co-financing, they can contribute to achieving their corporate social responsibilities (Deutscher Sparkassen- und Giroverband 2019; Salzmann 2013). Banks could use their core competence in financing to engage in a democratic exchange with customers and stakeholders. For one thing, this increases customer-centricity (Diener and Špaček 2021; Lotriet and Dltshego 2020). Banks can support their business clients by developing better products by offering customer-centric financing. Furthermore, through participative co-financing, banks can position themselves as more than just service providers but present themselves as enablers for self-empowerment. If banks make their expertise available to support democratic processes, they can inspire individual and community self-efficacy in their region. Simultaneously, banks offer a trustworthy environment in which crowdfunding can thrive to support effective financing (Cai et al. 2021). As a result, banks could excel because they enable the people’s will. By offering participative co-financing, banks could empower themselves.

The results of this study should be interpreted in light of its limitations, providing indications for future studies. Our dataset comes with several caveats. First, we draw on a rather small data set. Second, replies in our survey were given only by single informants, limiting the possibility of achieving a broad assessment of each regional bank and thus impeding the reduction of possible influences of common-method bias (Podsakoff et al. 2003). Third, the data set only consists of replies from one association of regional banks. For banks of other associations, other variables might be more relevant. Future research could pick up our survey and derive more observations from other financial institutions and associations to address these caveats. Future research could also broaden the geographic picture by comparing intentions about participative co-financing of German regional banks with other countries.

Our study is the first to investigate the banks’ intention to offer participative co-financing. However, other fields remain open for exploration. Our study focuses on variables from the fields of potential synergies, potential target groups, and experience. However, additional variables are worth considering. Worthwhile variables could be the potential to use crowdfunding to predict market acceptance or alternative target groups such as sports clubs, educational institutions, or renewable energy providers.

To investigate the compatibility of crowdfunding and regional banks, we develop a framework featuring the intersection of both means of financing (Fig. 2). We derive five key characteristics to compare both financing techniques. Despite a thorough determination of the characteristics, our framework does not claim to be complete. Future studies may expand and deepen the aspects we include in our framework. Further, we hope our framework and representation of the intersection supports future researchers in their attempt to analyze the compatibility of crowdfunding and regional banks. We advocate expanding the framework with non-financial-return crowdfunding.

Furthermore, future research could focus on relevant risks and obstacles that banks consider when evaluating the opportunity to combine crowdfunding and establish financing products. Likewise, future research could investigate which requirements banks issue as conditions to use participative co-financing. The banks’ process of integrating participative co-financing could be worth exploring as well. In this context, banks need to make a make-or-buy decision. Moreover, crowdfunding platforms and banks need to decide about strategic partnerships. The development of respective processes also requires that the geographic scope of the regional banks’ participative co-financing needs to be specified. While regional banks are rooted in their area, crowdfunding or participative co-financing can overcome regional limitations. It might be a promising measure for platform providers to offer banks the opportunity to gather experience together to advance participative co-financing further .

We encourage academics and practitioners to investigate and test applications of participative co-financing in order to gather experiences and advance this financing technique. Further experience is the key to advancing participative co-financing successfully. Through a combined approach, banks cannot only expand their digital sales channels but help their customers to gain financial sovereignty. Furthermore, banks might provide the foundation for a sustainable society.