Startup Crowdfunds Competitions for a Cause
Competitions have been used to solve major problems by governments, big companies and, most recently, tech firms and startups seeking new products.
Now, one company is providing a platform to inspire competitions that solve critical social, humanitarian and environmental issues. BigLeap, a San Francisco-based online startup attempting to create “outcome-driven innovation,” claims to be the world’s first crowdfunding prize and reward network.
“It’s really hard for nonprofits to drive innovation because they don’t usually have the money to take big risks,” said software veteran Victor Cho, who co-founded the company with serial entrepreneur Charlie Crystle. “But, there are all these great resources around the world that could be pulled in to solve a problem and create a big impact.”
Here’s how it works: Instead of asking for straight-up cash, like many crowdfunding sites for causes, Cho said BigLeap seeks prize money for funding competitions that will rally people to solve major and minor problems around social good.
Each challenged posted on BigLeap’s site has to go through a number of stages, including identifying the problem they want to solve and targeting amount they need to raise. They must then mobilize a team of problem solvers to compete. Once the problem is solved, the winning teams are rewarded and the original need, hopefully, is met.
If, for whatever reason, the funding target isn’t met or the problem is not solved, donors get most of their money back — sans credit card processing fees. Meanwhile, BigLeap takes an 8 percent cut of the funds received.
“The way I see it, crowdfunding for a cause is great, but it’s just asking for money at the end of the day, which only puts a patch over things — it’s not driving innovation or solving a root cause,” said Cho. “We want to create a measurable impact.”
The first — and only — challenge currently on the site aims at making education more accessible. Spearheaded by UC Berkeley professor Silvia Bunge and ThinkFun CEO Bill Ritchie, the challenge is designed to give children of low-income families and underfunded schools free games to improve kids reasoning and logic skills.
For this, Bunge and Ritchie seek to raise $25,000 for a competition that calls on designers from around the country to develop the best game-based learning programs that can be made for free, using common household items and art supplies.
While there are three other challenges in development — including one to improve the safety of flying robots and one to improve an abandoned building in the middle of the city — they will not launch until next month.
Cho said that anyone, in theory, can create a challenge. However, the organization will be screening the first 100 challenge-seekers to ensure they are legitimate and have the tools they need to run a successful competition.
“It’s simple criteria at end of day,” Cho said. “Are they super passionate about the endeavor and will they be able to spend some money to make the competition happen? That’s what we’re looking for.”
Cho said the power of the platform will be determined by the audiences each competition can reach. And the potential for mobilizing people all around the world to compete is what makes the platform unique.
“If a small school has a problem they want to solve, they should be able to fund a competition,” Cho said. “Maybe the problem solver they need is somewhere across the world. We want to turn on that competitive drive and direct it toward social good.”
SOURCE: San Francisco Business Times