Lars Hornuf

TU Dresden | TUD · Faculty of Business and Economics

The success of idea crowdsourcing platforms relies on fostering a collaborative environment that encourages active user participation, measured by the quality and quantity of contributions and interactions. However, understanding the impact of peer interactions on user engagement and the innovation process remains challenging. While previous studie...

We examine predictive machine learning studies from 50 top business and economic journals published between 2010 and 2023. We investigate their transparency regarding the predictive performance of machine learning models compared to less complex traditional statistical models that require fewer resources in terms of time and energy. First, we find...

Online platforms that implement reputation mechanisms typically prevent the transfer of ratings to other platforms, leading to lock‐in effects and high switching costs for users. Platforms are able to capitalize on this arrangement, for example, by charging their users higher fees. In this paper, we theoretically and experimentally investigate the...

In this article, we investigate accounting deregulation and analyze whether a reduction in the minimum content requirements for quarterly reporting negatively impacts information asymmetry and reduces firm value. Taking advantage of one of the rare deregulating measures, namely the transposition of the EU’s Transparency Directive into German law, a...

This article examines the operating and financial performance of venture firms conducting initial coin offerings (ICOs) with different types of investors and at different points along a venture’s life-cycle. Relative to purely crowdfunded ICO ventures, institutional investor-backed ICO ventures exhibit weaker operating performance and fail earlier....

Crowdsourcing platforms connect companies with heterogeneous users to create innovation ecosystems. However, platforms often have difficulty keeping users active. User engagement – the participation, interaction, and commitment among online users engaging in collaborative activities – is crucial to the continued success of these platforms. This pap...

We propose a taxonomy of cybercrime on the Ethereum blockchain and examine how cybercrime impacts victims' risk-taking and returns. Our difference-indifferences analysis of a sample of victims and matched non-victims suggests that victims increase their long-term total risk-taking and earn lower risk-adjusted returns in the post-cybercrime period....

Different classifications of crowdsourcing markets have been proposed. This chapter outlines the most relevant classifications and provides examples of crowdsourcing in its various forms. It offers a more complete definition of crowdsourcing, provides statistics of market developments, and discusses some of the larger market trends in China, German...

This chapter summarizes the results of this book and draws some legal policy conclusions. Our findings are mainly based on the analysis of legal framework conditions and the evaluation of the privacy statements of crowdsourcing platforms located in China, Germany and the U.S., presented in the preceding chapters. The results of this study provide i...

This chapter examines data protection laws in Germany, the United States, and China. We describe the most important legal sources and principles of data protection and emphasize the rights of data subjects, with particular attention to personal and sensitive data. The legal frameworks for data protection on crowdsourcing platforms in the three coun...

This chapter investigates how crowdsourcing platforms handle matters of data protection and analyzes information from 416 privacy statements. We find that German platforms mostly base their data processing solely on the GDPR, while U.S. platforms refer to numerous international, European, and state-level legal sources on data protection. The Chines...

This article analyzes how the General Data Protection Regulation (GDPR) has affected the privacy practices of FinTech firms. We study the content of 276 privacy statements respectively before and after the GDPR became binding. Using text analysis methods, we find that the readability of the privacy statements has decreased. The texts of privacy sta...

We show that the recently released text-based artificial intelligence tool GPT-4 can provide suitable financial advice. The tool suggests specific investment portfolios that reflect an investor’s individual circumstances such as risk tolerance, risk capacity, and sustainability preference. Notably, while the suggested portfolios display home bias a...

In this article, we use a meta‐analysis to examine the performance of socially responsible investing (SRI). We find that, on average, SRI neither outperforms nor underperforms the market portfolio. However, in line with modern portfolio theory, we find that global SRI portfolios outperform regional subportfolios. Moreover, high‐quality publications...

What role does the selection of an investor and the timing of financing play in initial coin offerings (ICOs)? We investigate the operating and financial performance of ventures conducting ICOs with different types of investors at different points in the ventures' life cycle. We find that, relative to purely crowdfunded ICO ventures, institutional...

When using digital devices and services, individuals provide their personal data to organizations in exchange for gains in various domains of life. Organizations use these data to run technologies such as smart assistants, augmented reality, and robotics. Most often, these organizations seek to make a profit. Individuals can, however, also provide...

People well known to the general public are increasingly acting as business angels (BAs) for young and innovative ventures worldwide. These BAs are less known for their venture evaluation skills and often do not have a professional reputation as investors. The signaling function of these well-known investors could therefore be less relevant for fou...

Can television have a mitigating effect on xenophobia? To explore this question, we investigate a natural experiment in which individuals in some regions of East Germany could not—due to their geographic location—consume West German television until 1989. By analyzing survey data from the periods before and after German reunification, we provide ev...

We examine the impact of fintech start-ups on the performance and default risk of traditional financial institutions. We find a positive relationship between fintech start-up formations and incumbent institutions’ performance for the period 2005–2018 and a large sample of financial institutions from 87 countries. We further analyze the link between...

In this study, we investigate whether and to what extent community managers in online collaborative communities can stimulate community activities through their engagement. Using a novel data set of 22 large online idea crowdsourcing campaigns, we find that moderate but steady manager activities are adequate to enhance community participation. More...

Marketplace lending has fundamentally changed the relationship between borrowers and lenders in financial markets. As with many other financial products that have emerged in recent years, internet-based investors may be inexperienced in marketplace lending, highlighting the importance of forecasting default rates and evaluating default features suc...

In a field experiment, we tracked whether crowdfunders clicked on a newsletter link to a new project and whether they invested. In terms of clicks, we find that crowdfunders overall respond most to an environmental framing, while older crowdfunders respond more to a financial framing than younger ones, and men respond less to a financial framing th...

Manipulative product and interface designs known as digital “dark nudges” have become a common phenomenon in the digital economy. This chapter investigates the behavioral science background and the main problem areas of such unethical online business practices. We also show the limits of the existing statutory framework for combating digital dark n...

Based on 26,883 investment decisions, we examine the influence of social media marketing on crowd participation in equity crowdfunding. We distinguish between different types of informative and persuasive posts on Facebook and Twitter. Informative posts provide investors with information about the crowdfunding campaign; persuasive posts do not, but...

In the past decade, crowdworking on online labor market platforms has become an important source of income for a growing number of people worldwide. This development has led to increasing political and scholarly interest in the wages people can earn on such platforms. This study extends the literature, which is often based on a single platform, reg...

We examine investor behavior on a leading peer-to-business lending platform and identify an investment mistake that we refer to as default shock bias. First, we find that investors stop investing in new loans and cease diversifying their portfolio after experiencing a loan default. The default shock significantly worsens the risk–return profile of...

We study the extent of fraud in initial coin offerings (ICOs), and whether information disclosure prior to the issuance predicts fraud. We document different types of fraud, and that fraudulent ICOs are on average much larger than the sample average. Issuers who disclose their code on GitHub are more likely to be targeted by phishing and hacker act...

We use data on individual investment decisions to analyze whether investors in equity crowdfunding direct their investments to local firms and whether specific investor types can explain this behavior. We then examine whether investments exhibiting a local bias are more or less likely to fail. We show that investors exhibit a local bias, even when...

In the past decade, crowdworking on online labor market platforms has become the main source of income for a growing number of people worldwide. This development has led to increasing political and scientific interest in the wages that people can earn on such platforms. In this article, we extend the literature based on a single platform, region, o...

Unlabelled: Fraud in the reward-based crowdfunding market has been of concern to regulators, but it is arguably of greater importance to the nascent industry itself. Despite its significance for entrepreneurial finance, our knowledge of the occurrence, determinants, and consequences of fraud in this market, as well as the implications for the busi...

In this article, we examine how investor motives affect investment behavior in equity crowdfunding. In particular, we compare the investment behavior of sustainability-oriented with ordinary crowd investors on six leading equity crowdfunding platforms in Austria and Germany and investigate whether they suffer from a default shock that was recently...

The increasing pervasiveness of technology-driven firms that offer financial services has led to growing pressure on traditional banks to modernize their core business activities and services. Many banks tackle the challenges of digitalization by cooperating with startup firms that offer technology-driven financial services and novel service packag...

Research Summary When evaluating Internet-based loan project of small and medium size firms (SME), lenders can rely on easy-to-understand risk ratings or more sophisticated financial information. We investigate lenders decisions and its effect on loan funding success on the marketplace lending platform Zencap. The dataset has been provided by the p...

Entrepreneurial finance markets are in a dynamic state. New market niches and players have developed and continue to emerge. The rules of the game and the methods for receiving financial backing have changed in many ways. This editorial and the special issue of Small Business Economics focus on crowdfunding (CF) and initial coin offerings (ICOs), w...

A common assumption is that entrepreneurs retain more control of their venture when opting for crowdinvesting rather than venture capital. In this article, we investigate the relevance of cash-flow, control, and exit rights awarded to crowd investors in Germany, where more flexible contracts are offered than in many other jurisdictions. In Germany,...

This article analyzes how the General Data Protection Regulation (GDPR) has affected the privacy practices of FinTech firms. We study the content of 308 privacy statements respectively before and after the GDPR became binding. Using textual analysis methods, we find that the readability of the privacy statements has decreased. The texts of privacy...

During the past decade, equity crowdfunding (ECF) has emerged as an alternative funding channel for startup firms. In Germany, the Small Investor Protection Act became binding in July 2015, with the legislative goal to protect investors engaging in this new asset class. Since then, investors pledging more than 1,000 EUR now must self-report their i...

During the past decade, equity crowdfunding (ECF) has emerged as an alternative funding channel for startup firms. In Germany, the Small Investor Protection Act became binding in July 2015, with the legislative goal to protect investors engaging in this new asset class. Since then, investors pledging more than 1,000 EUR now must self-report their i...

The digitalization of financial services opened a window for new players in the financial industry. These start-ups take on tasks and functions previously reserved for banks, such as financing, asset management, and payments. In this article, we trace the transformation of the industry after digitalization. By using data on FinTech formations in Ge...

Fraud in reward-based crowdfunding market has been of concern to regulators, but it is arguably of greater importance to the nascent industry itself. Using a sample of more than 270,000 crowdfunding campaigns posted from 2010 through 2018 on Kickstarter, the largest global reward-based crowdfunding platform, and exploiting an event study like metho...

This chapter analyzes the potential need for regulation in the German FinTech market. To this end, theoretical considerations and insights from expert interviews are discussed. Both our theoretical findings and the expert interviews suggest that further regulation of many details around FinTechs is necessary and that this particularly applies to as...

This chapter deals with data protection regarding FinTech services and how FinTechs dealt with it after the implementation of the GDPR in May 2018. The primary source of information on how FinTechs are handling data protection is the privacy statements of the respective companies. We analyzed these privacy statements with regard to three questions:...

This chapter uses theoretical considerations and insights from expert interviews to analyze four different aspects of FinTech business models. First, we analyze the FinTechs’ cooperation with banks and find that both sides can usually profit from cooperation, while in practice cooperation also can fail. In a second step, we investigate the use of b...

This chapter analyzes the development and current status of the German FinTech market. In particular, it outlines the different segments and subsegments of the FinTech industry. It further provides descriptive statistics on market volume for each segment, discusses general trends, and analyzes current market developments.

The chapter summarizes the results of this book in the form of eleven theses. The theses are based on the evaluation of the privacy statements of FinTechs operating in Germany, the evaluation of 36 expert interviews, and the theoretical and empirical arguments presented in the previous chapters. They provide pointed statements for discussions on th...

This chapter deals with data protection regarding FinTech services and how FinTechs dealt with it before the implementation of the GDPR in May 2018. The primary source of information on how FinTechs handled data protection is the privacy statements of the respective companies. We analyze these privacy statements with regard to three questions: What...

In diesem Kapitel werden die Entwicklung und der aktuelle Stand des deutschen FinTech-Marktes dargestellt. Die Erkenntnisse basieren maßgeblich auf den beiden Publikationen von Dorfleitner et al. (2017) und Dorfleitner et al. (2018).

Abschließend fassen wir die Ergebnisse des vorliegenden Buches in Form von elf Thesen zusammen. Diese Thesen basieren sowohl auf der Auswertung der Datenschutzerklärungen in Deutschland tätiger FinTechs als auch auf der Auswertung der Experteninterviews sowie den in den vorangegangenen Kapiteln geführten theoretischen und empirischen Argumentatione...

Dieses Kapitel beschäftigt sich mit dem Datenschutz bei FinTech-Dienstleistungen. Eine Primärquelle für den Umgang mit dem Thema Datenschutz durch FinTechs sind die Datenschutzerklärungen der jeweiligen Unternehmen. Diese wurden in einem ersten Schritt daraufhin ausgewertet, welche Daten von Nutzerinnen und Nutzern erhoben werden, an wen diese Date...

Ob es bezüglich des Datenschutzes inhaltlichen Regulierungsbedarf gibt, kann im Rahmen dieses Buches nicht geklärt werden und bleibt dem Urteil juristischer Untersuchungen überlassen. Fest steht jedoch, dass die DS-GVO und auch die geplante ePrivacy-Verordnung, die die Richtlinie für elektronische Kommunikation (RL 2002/58/EG) und die sogenannte Co...

Dieses Kapitel beschäftigt sich mit verschiedenen Aspekten von FinTech-Geschäftsmodellen. Zunächst analysieren wir die Kooperation der FinTechs mit den Banken. In einem zweiten Schritt wird der Einsatz von Big Data bei FinTechs untersucht. Insbesondere werden bereits bekannte Einsatzfelder und Anwendungen von Big Data bei FinTechs beschrieben und z...

Dieses Kapitel beschäftigt sich mit dem Datenschutz bei FinTech-Dienstleistungen nach Einführung der DS-GVO und bildet den Hauptteil dieses Buches. Als Datenquelle wurden wie bereits in Dorfleitner und Hornuf (2018) die Datenschutzerklärungen der jeweiligen FinTechs herangezogen. Um Veränderungen in der Zeit vor und nach Einführung der DS-GVO zu un...

We investigate the economic and technological determinants inducing entrepreneurs to establish ventures with the purpose of reinventing financial technology (fintech). We find that countries witness more fintech startup formations when the economy is well-developed and venture capital is readily available. Furthermore, the number of secure Internet...

Historically, people have often expressed negative feelings toward speculators, a sentiment that might have even been reinforced since the latest financial crisis, during which taxpayer money was warranted or spent to bail out reckless investors. In this paper, we conjecture that judges may also have anti-speculator sentiment, which might affect th...

Ever since 2004 companies located in Member States of the European Economic Area have been able to opt to incorporate in a supranational legal form, the Societas Europaea. We found that companies located in Member States where the Societas Europaea offers additional legal arbitrage opportunities benefit most. Moreover, our results show that the sto...

Using an artefactual field experiment, this paper tests the long-term implications of living in a specific economic system on individual dishonesty. By comparing cheating behaviour across individuals from the former socialist East of Germany with those of the capitalist West of Germany, we examine behavioural differences within a single country. We...

Digitale Finanztechnologie, kurz FinTech, ist eine wichtige Antriebsfeder für Innovationen in der Finanzbranche. Die umfassende Verarbeitung von Nutzerdaten birgt aber auch das Potential unternehmerischer und systemischer Risiken, die eine effektive Aufsicht und Regulierung notwendig machen. In diesem Buch stellen die Autoren zunächst die am Markt...

This book examines the FinTech revolution from a data privacy perspective. It analyzes key players on the FinTech market and the developments in various market segments. Particular attention is paid to an empirical analysis of the privacy statements of 505 German FinTech firms and how they were adapted after the General Data Protection Regulation (...

This chapter presents insights into the question whether followers’ perceptions of authentic leadership attenuate cheating. From the perspective of self-concept maintenance theory, followers will cheat so long as they can maintain a positive self-concept. We suggested that authentic leadership lowers the perceptual threshold under which followers c...