Developing a Sharīʿah-compliant equity-based crowdfunding framework for entrepreneurship development in Malaysia
Abstract Purpose – Crowdfunding has become one of the preferred mechanisms to raise funds by startups and small entrepreneurs. As such, this paper aims to develop an appropriate framework for Sharīʿah-compliant equitybased crowdfunding (SEC) for entrepreneurship development in Malaysia. Design/me...
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| Main Authors: | , , |
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| Format: | Article |
| Language: | English English |
| Published: |
Emerald Group Holdings Ltd.
2020
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| Subjects: | |
| Online Access: | http://irep.iium.edu.my/83476/7/83476_Developing%20a%20Shar%C4%AB%CA%BFah-compliant%20equity-based%20crowdfunding_SCOPUS.pdf http://irep.iium.edu.my/83476/13/83476_Developing%20a%20Shar%C4%AB%CA%BFah-compliant%20equity-based%20crowdfunding.pdf http://irep.iium.edu.my/83476/ |
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| Summary: | Abstract
Purpose – Crowdfunding has become one of the preferred mechanisms to raise funds by startups and small
entrepreneurs. As such, this paper aims to develop an appropriate framework for Sharīʿah-compliant equitybased crowdfunding (SEC) for entrepreneurship development in Malaysia.
Design/methodology/approach – The research begins by analyzing the intention of 200 entrepreneurs
in Kuala Lumpur and Selangor regarding the use of crowdfunding to raise capital. The analysis is based on
the theory of reasoned action (TRA), which is also associated with the technology acceptance model (TAM)
and is effected by using structural equation modeling (SEM).
Findings – The entrepreneurs agree on the ease of use of crowdfunding in raising capital, although it
appeared that they are quite reluctant to share their business ideas online. Subsequently, an SEC framework
is proposed, to further enhance entrepreneurship development in Malaysia particularly in meeting the need
for raising funds in line with Sharīʿah (Islamic law) principles.
Practical implications – This paper aims to contribute more to the development of a blueprint for an
SEC platform for market players and regulators in Malaysia.
Social implications – This paper also aims to highlight the growing needs of entrepreneurs, particularly
in Malaysia to have a Sharīʿah-compliant alternative to raise funds via crowdfunding.
Originality/value – This paper makes two main contributions. First, it provides evidence on Malaysian
entrepreneurs’ intention to use crowdfunding for fundraising through TAM and SEM analysis. Second, it
proposes an SEC framework for the development of entrepreneurs in Malaysia. |
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