Financial-based Crowdfunding: An Alternative Entrepreneurial Funding in Malaysia amidst Covid-19

This study explores the possibility for financial-based crowdfunding as alternative funding for entrepreneurs during the Covid-19 crisis. It seeks to determine whether crowdfunding should become one of the ventures’ crisis management and future planning. This paper is conceptual in nature and reviews the related literature on the potential of crowdfunding in helping entrepreneurs to secure funding during the pandemic. In order to present an actual scenario that reflects Malaysia’s crowdfunding-based activity, contents which relate to crowdfunding activities during the crisis were extracted from the platforms’ websites. Crowdfunding activities are conducted virtually during Covid-19, making it possible for the fundraiser to approach the funder. However, the number of funders’ participation during the pandemic showed a decline. In most cases, tech-related and R&D projects tend to report successful funding campaigns. Moreover, trustworthiness and social capital are factors that increase the campaign success rate during the current crisis. The entrepreneur's ability to make use of every possible resource (entrepreneurial bricolage) is a value added trait that helps them to confront the crisis. Additionally, the government’s role is important during the crisis to ensure that entrepreneurial activities could continue to move. Lastly, entrepreneurs may enhance their survivability and sustainability by creating more value for better economic growth. This study is one of the few studies to explore the adoption of online funding through the financial-based platforms in Malaysia during pandemic. The study finds that financial-based crowdfunding has a significant effect on the entrepreneurial funding in Malaysia context. Hence, more entrepreneurs should develop their knowledge to have a better picture of the online funding, the strengths and weaknesses it constituted for the future growth of the ventures. The pandemic’s broader implications require policymakers to have real-time information for decision-making. Thus, the government should leverage the financial-based platforms’ purpose for the benefit of entrepreneurial aims.