Crowdfunding and the Sustainability Dilemma: Do Sustainable-Oriented Campaigns Perform Better? A Machine Learning Approach.

Sustainability has become an increasingly relevant factor in crowdfunding, yet its impact on fundraising success remains uncertain across different platform models. This study examines how sustainability orientation influences crowdfunding outcomes by comparing equity-based and reward-based settings, considering its effect on the amount of capital raised, the number of investors, and the likelihood of success. While we find that sustainability directly enhances success and increases the amount of capital raised and the number of investors in reward-based crowdfunding, its effect on equity crowdfunding is contingent on how it is disclosed. Specifically, we analyze whether campaign blurb length moderates sustainability?s impact, revealing that while sustainability generally enhances crowdfunding performance, its effect diminishes as the blurb length increases, indicating that longer descriptions may dilute or weaken the effectiveness of sustainability messaging. Using a novel machine learning-based classification method, we improve upon traditional keyword-based approaches to identifying sustainability disclosures. Our findings contribute to the literature on sustainable finance and investor behaviour, offering insights for entrepreneurs, investors, and crowdfunding platforms. Understanding how sustainability interacts with investor decision-making can help optimize campaign strategies, ensuring sustainability is communicated effectively to maximize funding potential