Why Contests Improve Philanthropy

Contests for innovation go back hundreds of years — many have even changed history.  The Knight Foundation in the US has used its extensive experience to produce a new report on Why Contests Improve Philanthropy – Six Lessons on Designing Public Prizes for Impact.

In the US, Knight Foundation has supported nearly a dozen open contests, reviewed almost 25,000 applications and chosen more than 400 winning ideas. The Foundation has learned a lot from this experience about how good contests work, what they can do, and what the challenges are.         

It has launched a new report, “Why Contests Improve Philanthropy: Six Lessons on Designing Public Prizes for Impact,” bringing together its experiences in managing contests across all their program areas: journalism and media innovation, arts and communities.

“One thing stood out for us – contests make up less than 20 percent of our grant-making, but they have changed how we work as a foundation and reshaped our traditional programs,” Vice President of Strategy and Assessment at Knight Foundation Mayur Patel said.

“They helped create a ‘safe zone’ for experimentation that has influenced other areas of our grant making. It’s challenged our routines and entrenched behaviors.

“All of our programs have now used contests to uncover new trends, widen their networks and support bold new ideas. In total, we’ve granted more than $75 million to experimental arts projects, resident-led neighborhood improvements, tech startups and data applications. Our support has gone to individuals, nonprofits and commercial enterprises.

“Along the way, we’ve reviewed the effectiveness of individual contests. We’ve looked at the progress winners have made, refinements to how we run our processes and the issues we focus on,” Patel said.

“We’re not alone in our commitment to contests. We see stellar work being done by others, including among others the X-Prize Foundation, Case Foundation, Bloomberg Philanthropies, MacArthur Foundation, the Robert Wood Johnson Foundation and the Rockefeller Foundation. Like many of these organizations, Knight Foundation sees lasting opportunities in contests. They are an effective tool helping us – and helping others – create social change,” he said.

Here are the Six Lessons on Designing Public Prizes for Impact:

1. Contests bring in new blood and new ideas. Through contests we’ve increased opportunities for people to participate in our work and in their communities.  
2. Contests create value beyond the winners. Contests have exposed our foundation to a host of new talent and creativity from different disciplines and brought in many winners who otherwise would not have applied for a traditional grant. In the Knight Arts Challenge, more than 40 per cent of the non-winning entrants surveyed said just the process of applying was beneficial.
3. Contests help put the spotlight on emerging trends and provided us with feedback to improve how we connect with our communities. Our contests are generally based on broad topic areas rather than on solving a very narrow question or problem.
4. Contest helped us change our routine. Contests are almost certain to cause you to change entrenched foundation behaviors. This may sound internally focused, but it isn’t. If your traditional funding changes, that’s a bigger pot of money than the contest pool.
5. Contests go hand in glove with existing program strategies. Foundations shouldn’t undertake a contest as a lark or a just-for-the-heck-of-it enterprise. The most successful are embedded in existing program strategies. They are simply a different way to tackle a foundation’s key areas of focus.
6. Contests should thoughtfully engage the community. To get the most out of competitions, you need new judging systems. If a foundation puts new ideas through the old selection mill, nothing really new will emerge. But if people in the community can comment on or even help choose the winners, they feel engaged, which further promotes the contest. But tapping into the wisdom of the crowd can be a tricky proposition. You must guard against lesser ideas winning just because they come from the most popular sources.