1124: Dark Shadow of Identity Disclosure in Crowdfunding After Racially Salient Events (19431)

Extant research suggests that minority entrepreneurs disproportionately suffer from racial salient events. However, a nuanced view of why this happens, who suffers the most, for how long such suffering occurs, and how to mitigate this racial disparity afterward has yet to be fully examined, particularly in entrepreneurial financing. By integrating the insights of social identity theory's derivative of racial salience and consumer animosity theory's derivative of pandemic animosity, this study theorizes how external resource providers exhibit bias against minority entrepreneurs in response to racially salient events that targeted the minority group. We suggest that minority entrepreneurs’ suffering can be mitigated in both a passive and active way: waiting for the event-driven salience to face over time or strategic avoiding visible representation of the minority in fundraising efforts. Using the fundraising attempts of minority (Asian) entrepreneurs through crowdfunding before and after the surge of anti-Asian movements during the COVID pandemic, we find support for our theorization. This study contributes valuable insights to understanding discrimination and animosity within entrepreneurship, paving the way for more inclusive and equitable economic opportunities for all.

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