Opportunity or nonsense? Examining the role of CEOs’ social media usage in raising funds

Amid the ongoing digital transformation, social media has emerged as a novel avenue for business communication and growth, with investors increasingly engaging with these platforms as supplementary information sources. However, whether and how CEOs’ social media activity influences firms’ financing outcomes remains an open and pressing question. This study investigates this relationship by employing regression analysis and Latent Dirichlet Allocation thematic modeling on a sample of 1438 Chinese firms that received their first round of venture financing (Series A) in 2015. The results reveal that CEOs’ social media usage is significantly negatively associated with financing outcomes. This correlation is further moderated by the CEOs’ regulatory focus, their social capital, and the firms’ business model. The study draws on field theory, upper echelons theory, and regulatory focus theory to develop a comprehensive analytical framework, offering new insights into entrepreneurial financing behavior and strategic managerial use of social media in capital-raising contexts.