With the holiday season firmly behind us, and maybe some of those credit bills coming due, what better time to look at investors’ willingness to fund crowdfunding offerings during that busy time of year. “Tis the season of giving” the saying goes, and for charitable giving, that is often the trend. However, are crowdfunding investors as charitable with their investment dollars during this time of year?

At first glance, it would appear that there is in fact a drop off in investment during the month of December. Looking at the 3-month window around December 2018, we can see a V-shape in the path of investment, declining over $850 thousand from November to December, and then spiking back up by over $2.1 million ($7.3M vs. $5.2M) in January of 2019. January saw six more new deals than December (56 vs. 50), which could explain some of this increase, but probably not the full amount.

What about December 2017? From November to December, commitments declined just over $1.4 million, from over $9.3 million to $7.9 million. But the V-shape pattern we saw in 2018? Well that’s not as easy a story to tell in 2017, as commitments declined in the following two months (January and February of 2018) before spiking back up in March of 2018 to over $8.2 million (with a jump in new deals to 60 in March as well). So what do we make of all this? Well that is where it gets a little more interesting to dig deeper into the data.

Much of the Crowdfunding literature tells us that a large portion of an offering’s investment dollars come in the early days of investment, as well as towards the end of the offering, following a U-Shaped pattern (Kuppuswamy and Bayus, 2013). On its face, it appears that there is at least some decline in overall December commitments, but does that extend to new offerings (or closing offerings) and this U-Shaped pattern? Are some offerings impacted more by a decrease in investment than others are during the holiday season?

The results appear to indicate that if you are planning to launch your crowdfunding offering, maybe try to get that offering up off the ground before the calendar turns to December. I perform an analysis that attempts to look at the impact on investment during December across both existing offerings and offerings during their first week, controlling for some of the high level offering characteristics. Interestingly, I find offerings that start in December bring in nearly $2,500 less during their first week than offerings that start in any other month, a not insignificant amount.

This decrease in first week investment may also contribute to what appears to be a drop in the success rate of December offerings (though this result can also be attributed to December 2018 offerings that have not yet closed). At the close of the offering, there does not appear to be any measurable change in investment (though the results indicate a positive investment trend, as opposed to the decline seen in the first week of December offerings).

So what do we make of all this? There could be a few things at work here. The first could be the idea I posited at the start, that investors are concentrated on spending money elsewhere during the holiday season, and therefore allocate fewer investment dollars to crowdfunding offerings. Another force at play could be the regulations set by Reg CF, and investors are simply tapped out on their allowed investment within a 12-month window, and have to pass on investments opportunities. Lastly, the quality and type of offering launched in December may be just different enough to keep investors’ wallets closed at the end of the year.

So what can firms launching offerings do? Many firms may be constrained in when they are able to launch their crowdfunding campaigns, and this may just be an unavoidable problem. But for those targeting a December launch and able to move it up to November, or hold off a few weeks and wait until January, it might be worth your while.