Less is more? Evidence for a curvilinear relationship between readability and screening evaluations across pitch competition and crowdfunding contexts

We explore how the readability of an investment document influences new venture screening evaluations. Based on two field studies across pitch competition and crowdfunding contexts, we find that documents of high and low readability receive more favorable screening evaluations compared with those of medium readability. Our post-hoc experiment illustrates how the effect of readability is mediated by entrepreneurial capability and idea complexity. It appears that highly readable documents are generally valued because they make it easy for investors to process information, whereas less readable documents may be preferred because investors perceive the entrepreneurs to possess greater capability.