  Crowdfunding offers inventors and entrepreneurs alternative access to
resources with which they can develop and realize their ideas. Besides helping
to secure capital, crowdfunding also connects creators with engaged early
supporters who provide public feedback. But does this process foster truly
innovative outcomes? Does the proliferation of crowdfunding in an industry make
it more innovative overall? Prior studies investigating the link between
crowdfunding and innovation do not compare traditional and crowdfunded products
and so while claims that crowdfunding supports innovation are theoretically
sound, they lack empirical backing. We address this gap using a unique dataset
of board games, an industry with significant crowdfunding activity in recent
years. Each game is described by how it combines fundamental mechanisms such as
dice-rolling, negotiation, and resource-management, from which we develop
quantitative measures of innovation in game design. Using these measures to
compare games, we find that crowdfunded games tend to be more distinctive from
previous games than their traditionally published counterparts. They are also
significantly more likely to implement novel combinations of mechanisms.
Crowdfunded games are not just transient experiments: subsequent games imitate
their novel ideas. These results hold in regression models controlling for game
and designer-level confounders. Our findings demonstrate that the innovative
potential of crowdfunding goes beyond individual products to entire industries,
as new ideas spill over to traditionally funded products.
