Information Disclosure on Operational Risks and Mitigation Strategies in Crowdfunding Projects: From the Supply Chain Perspective

In reward-based crowdfunding, projects are to disclose the operational risks and mitigation strategies for delivering the physical rewards during the funding phase. However, limited knowledge exists regarding projects’ operational risks and mitigation strategies during the funding phase. In contributing to the literature, the study uses data on Kickstarter.com and conducts a content analysis to explore themes and their relationships. The results reveal various operational risks and associated mitigation strategies. Among the identified themes, product-related, contract manufacturers, and supply markets are the most expected risks, while outsourced production and proactive sourcing are the popular mitigation strategies. Also, the finding reveals that proactive sourcing and outsourced production, in-house production and post-campaign sourcing, contract manufacturer risk, and project internal risk are themes forming clusters. The results extend crowdfunding risk disclosure literature and set the tone for future research in crowdfunding operational risk management. Finally, other business implications are drawn for crowdfunding practitioners.