<p>Crowdfunding success hinges on overcoming severe information asymmetry. This study investigates returning backers—a potent signal of execution credibility. While prevailing views suggest this signal should enhance both funding (elemental view) and engagement (processual view), we uncover a critical paradox. Analyzing Kickstarter data, we find that while a higher proportion of returning backers positively predicts funding success, it is robustly and negatively associated with observable public engagement, specifically positive backer sentiment. We explain this paradox through an integrated dual mechanism: founders strategically reallocate attention toward new acquisitions (attention-based view), enabled by mature relationships favoring efficient, latent exchanges over costly public signaling (social exchange theory). Our findings, which hold after addressing potential endogeneity concerns, demonstrate the sharp outcome contingency of signals. Critically, we identify a significant temporal trade-off: optimizing short-term funding may inadvertently suppress the observable “market buzz” valued by future investors (e.g., VCs), creating strategic conflicts across the entrepreneurial finance lifecycle.</p>