A2+B2=C2?
Designing a crowdsourced incentive prize is not rocket science or heart surgery, despite how it may sound. In fact, most aspects are pretty easily attainable by one or two people putting their heads together! Perhaps the biggest head-scratcher of all isn't what you might expect: what is your prize amount's dollar value?
Charles Lindbergh crossed the Atlantic Ocean to win a $25,000 incentive prize.
Scaled Composites and their team Tier launched the first non-governmental, reusable manned spacecraft into space twice within two weeks to win the first $10,000,000 XPRIZE.
Denise Resnik designed an autism care program to win $50,000 in the Autism Speaks, House to Home Challenge.
What kind of prize should you be offering to the innovators in order to attract them to your incentive competition?
Use This Formula:
(L+C)DxS= (Prize Amount)
L= Length
How long will your challenge endure?
How much time and attention will your average participants need to put into their answer? Is it likely that they spent weeks, months, or years on the answer?
Measure L in weeks.
6 month challenge= L(24)
C= Cost
How much money to you imagine your average innovator has put into the creation of the solution? It is important to weigh grant money differently than personal money.
Ie: If they have put $1,000 of their own money into the solution C=1000.
If they put $1,000 of grant money into the solution, C=500.
D= Difficulty
What is the Difficulty of your challenge?
Consider this base 10 rating system:
If 1/100 people could provide you a solution, give it a difficulty score of “1”.
If 1/1,000 people might be able to create a solution, score it “2”
1/10,000=3
1/100,000=4
1/1M=5
1/10M=6
1/100M=7
1/1B=8
1/10B (the world population)=9
As for scoring your challenge at a “10”... well, you’re essentially hoping for extraterrestrial life or an advanced lifeform from the future to travel back in time and provide you with the answer.
S= Sacrifice
Will you be asking innovators to give up all of their Intellectual Property rights?
Again, score “S” on a 1-10 scale:
1, meaning the winning competitor receives their prize money and keeps their IP.
5, meaning you and the innovator will share the IP.
10, meaning they will forfeit their IP rights entirely.
(L+C)DxS=Prize Amount
It’s important to note: This formula isn’t absolute. It doesn’t account for currency exchange rate, or competitors who are incentivized by factors beyond money. This formula can simply helps you quantify the value of the innovation you seek.
But, if you fall short of the amount your formula predicts-- you must remember: It doesn’t hurt to run the challenge anyway!
Someone might still be willing to offer you their innovation for the amount you have available…
