Using the Crowd as an Innovation Partner

by Kevin J. Boudreau and Karim R. Lakhani

Photography: Michele Sereni

Artwork: Jacob Hashimoto, The Other Sun, 2012, acrylic, paper, thread, bamboo, Ronchini Gallery, London

To answer the most vexing innovation and research questions, crowds are becoming the partner of choice. Apple has turned to large numbers of users and developers distributed around the world to propel its growth by creating apps and podcasts that enhance its products. Biologists at the University of Washington used crowds of external contributors to map the structure of an AIDS-related virus that had stumped academic and industry experts for more than 15 years. Despite a growing list of success stories, only a few companies use crowds effectively—or much at all.

Managers remain understandably cautious. Pushing problems out to a vast group of strangers seems risky and even unnatural, particularly to organizations built on internal innovation. How, for example, can a company protect its intellectual property? Isn’t integrating a crowdsourced solution into corporate operations an administrative nightmare? What about the costs? And how can you be sure you’ll get an appropriate solution?

These concerns are all reasonable, but excluding crowdsourcing from the corporate innovation tool kit means losing an opportunity. The main reason companies resist crowds is that managers don’t clearly understand what kinds of problems a crowd really can handle better and how to manage the process. Over the past decade we’ve studied dozens of company interactions with crowds on innovation projects, in areas as diverse as genomics, engineering, operations research, predictive analytics, enterprise software development, video games, mobile apps, and marketing. On the basis of that work, the supporting body of economic theory, and rigorous empirical testing, we’ve identified when crowds tend to outperform the internal organization and, equally important, when they don’t. In this article we offer guidance on choosing the best form of crowdsourcing for a given situation. We also review how technology is helping managers address these concerns. Crowds are moving into the mainstream; even if you don’t take advantage of them, your competitors surely will.

Beyond “Make or Buy”

Let’s start by noting the fundamental differences between crowd-powered problem solving and traditional organizational models. Companies are relatively well-coordinated environments for amassing and marshaling specialized knowledge to address problems and innovation opportunities. In contrast, a well-functioning crowd is loose and decentralized. It exposes a problem to widely diverse individuals with varied skills, experience, and perspectives. And it can operate at a scale that exceeds even that of the biggest and most complex global corporation, bringing in many more individuals to focus on a given challenge.

In certain situations, that means we can solve problems more efficiently. For example, we worked with the Harvard Clinical and Translational Science Center (known as Harvard Catalyst) to design a contest to solve a tough computational biology problem that had immediate research and commercial implications. To provide a platform for the contest, we enlisted TopCoder, a company that administers computer programming competitions. The two-week contest attracted viable solutions from 122 solvers—a staggering number. Many of the solutions surpassed the quality of those developed over the years by the school’s own scientists and by experts at the National Institutes of Health.

In addition to benefits of scale and diversity, crowds offer incentives that companies find difficult to match. Companies operate on traditional incentives—namely, salary and bonuses—and employees are assigned clearly delineated roles and specific responsibilities, which discourages them from seeking challenges outside their purview. But crowds, research shows, are energized by intrinsic motivations—such as the desire to learn—that are more likely to come into play when people decide for themselves what problems to attack. (Can you imagine any company paying a salary to an employee who’s just floating around looking for a problem to solve?) The opportunity to burnish one’s reputation among a large community of peers is another strong motivator (as is money, to be sure). Also, crowds are often more cost-effective per output or per worker than traditional company solutions.

So although internal, crowdlike approaches to creativity and idea generation, such as “jams,” “idea marketplaces,” and “personal entrepreneurial projects,” may increase the scope for exploration and flexibility inside companies, they are qualitatively different from and fall short of the full capability of external crowds. At the same time, it should be said that the benefits of the crowd do nothing on their own to offset the management worries mentioned above. We will describe the safeguards and other mechanisms that address those worries.

Crowdsourcing as a way to deal with innovation problems has existed in one form or another for centuries. Communities of innovators have helped kick-start entire industries, including aviation and personal computing. The difference today lies in technology. Over the past decade tools for development, design, and collaboration have been radically transformed; they’re getting more powerful and easier to use all the time, even as their prices plummet. At least as important, online crowdsourcing platforms have become much more sophisticated, making it ever simpler to manage, support, and mediate among distributed workers. Companies can reinvigorate (with incentive systems, for example) and redeploy crowds across a continual stream of problems. In essence, the crowd has become a fixed institution available on demand.


Forty-Eight Hours at NASA’s Biggest Hackathon

Forty-Eight Hours at NASA’s Biggest Hackathon

By Julian Taub

(Photo: Alice Ng, NY Tech Council)

Sam Wilkinson figured out how to bake bread in space. Last weekend, the 16-year-old from Oxford and winner of the 2012 NASA Space Apps Challenge, waved at a gaggle of hackers and reporters over video projection. It was the first day of the 2013 Space Apps Challenge, and Wilkinson was offering up some advice on what projects to tackle and what to expect over the next 48 hours.

The 2013 NASA Space Apps Challenge was the biggest hackathon known to man, with 9,000 registered participants scattered across 83 locations around the world–and on the International Space Station. I had the chance to check out the challenge’s New York City site. Boasting some 350 registrants (around 200 showed up), it was arguably one of the biggest hubs in the global contest. With introductions complete, everyone broke off into separate teams to tackle any one of 58 challenges.

“I personally believe that NASA is filled with brilliant rocket scientists and engineers, and we’re doing awesome things,” Nick Skytland told me. “But to truly solve the grand challenges, we have to engage people from around the world in solving them with us.”

Skytland is the Program Manager of NASA’s Open Government Program and creator of the Space Apps Challenge. He went on to explain the event’s origins, which stem from the agency’s pushback against Random Hacks of Kindness collaborations.

“NASA leadership asked us what a hackathon has to do with NASA,” he added, “and we said, ‘We’d love to show you. Are you willing to take a risk and let us?’”

Hack infomural (Julian Taub)

Skytland was amazed how quickly the event grew in just a year’s time. To his estimation, this year’s Challenge was almost four times larger than last year’s.

“I can’t even imagine what’s going to come out of this weekend,” Skytland admitted. “I’m walking around here and these solutions are incredible. It gives me goosebumps thinking about what people can do.”

Skytland toured the New York hub, engaging every collaborating group not only on the impact of their hack, but also on the potential opportunities that may spin off from their projects somewhere down the line. As an advocate for non-monetized collaboration, he tries to steer away from what he calls the “culture of competition.”

“It’s our job as a government agency to aggregate those contributions no matter how small, to help further space exploration,” he said. “People want to contribute and change the world. Let’s let them.”

“The nature of space is that it touches us from all angles of the globe. And so the data that we take about our own planet comes from space and it tells us stuff about areas all over the surface of our planet,” said Jennifer Gustetic, the Prizes and Challenges Executive at NASA who helped craft many of the challenges and moonlit as a judge on some of the final projects. “There’s also great skills everywhere in the world, especially in the development communities, in the additive manufacturing communities, in the design communities. It’s really interesting to see what people can do when they collaborate across boundaries to create solutions.”

Immediately after the event kicked off, high school students met with astronaut Ron Garan, who led an international Google Hangout.

“We had an astronaut in Italy, in Philly, and then up here in New York, and we had tie-ins with Japan, with London, and Toronto,” said Deborah Diaz, Deputy Chief Information Officer at NASA. “There were about ten different areas that were all pulling into this Google Hangout and then we had people virtually around the world that were watching this, getting excited about it, and really taking the lessons learned from these astronauts and applying them to the real life challenges that we have.”

Astronaut Ron Garan loves pizza (via Alice Ng, NY Tech Council)

Throughout the hackathon, innovation was infectious. Clusters of people huddled over their computers or hardware, mapping out their projects, scrapping ideas, and improvising solutions. Participants roamed from table to table, lending friendly tips and even spare hardware. Online, folks could enter their contact information onto the Space Apps Hackpad, and work with individuals in any of the seven continents or Low Earth orbit. We all joked together, dreamt together, and suffered through a sleepless night together.

“I think it’s fantastic that so many people, from such a diverse background of disciplines have gotten involved this year,” said Mike Caprio, Community Leader of Startup Bus and co-organizer of the event. “We have folks who are mathematicians, aerospace engineers, scientists from all manner of backgrounds, biologists. We’ve got all the designers and developers we can possibly bring out.”

“What I love about this event is that it allows everyday people, who may not work in tech or science, to get involved with these projects,” said Alice Ng, Director of Community and Events at the New York Technology Council who was co-running the New York hub. “Projects that NASA does tend to have a high entry, high barrier to entry, so this type of hackathon allows people just like you and I to get involved.”

People like James Wanga, a software developer at HBO, whose team wanted to build a drone that could map the surface of an asteroid with lasers.

“I got the idea when I watched the movie Prometheus,” Wanga said, “and I saw the little drone that goes through the cave and maps the wall of the cave, so that they can get a three-dimensional view, and I thought that would be an awesome thing to do.”

Wanga’s team divided into three subgroups–one hacking into a quadricopter drone, another working on the math for reading the mapping sensors and positioning the drone, and Wanga himself writing the code for the mapping technology. Originally, the drone team was going to ask some grad students to take some lasers from a nearby lab, but they settled for sonar, which is lighter and need less power to run.

Part of their laser-drone team split off to create their own project, “Chillin’ on Mars”. Edwin Rogers, along with a 3D-rendering developer, created a virtual interactive website where the viewer navigates through Curiosity’s footage as if walking around the red planet. The idea sparked when he saw an Occulus VR (virtual reality goggles) lying around in one of the rooms.

“I just picked it up, and I immediately thought if we take the Mars rover information and you get a sense that you were ON MARS,” Rogers told me.

Team Space Races shows off their stuff (Alive NG / NY Tech Council)

Space Races, another project, teaches kids how to be fiscally responsible when planning a NASA mission. The brainchild of an aerospace engineer, a graphic designer, a mathematician, and a code ninja, the game lets you create your own trip to a nearby asteroid, helps you pick out supplies needed for the journey and then projects the final cost. The team wanted to give people a sense of what goes into mission budgeting choices without putting too much on the user’s plate.

Robert Carlson, a software engineer at an advertising agency, teamed up with a few high school kids and two developers to work on 3D printing star cluster sculptures.

“I initially came across this when I looked at a data visualization done by artist Robert Hodgin,” Carlson said. “He made a screen saver called ‘Look Up,’ which was done to help make a personal connection to the vastness of space, and how we transit from one star to another. And I was thinking, would there be a way to turn that into a physical model, that you can then hold, and therefore get a more personal connection to where we exist in our cosmic neighborhood.”

There were also ambassadors from various sponsoring tech companies, like Aviary, Shapeways, Foursquare, and Twilio, helping hackers implement their product’s APIs.

“Mashing up the power of a really good API with NASA’s data, that’s a powderkeg,” Caprio, the event’s co-organizer, said. The team that best utilized a specific API won a prize from that company.

Before long, towards the final presentations, the entire floor grew quiet. Entrants strained the last bits of code, the final few tweaks. When the main hacking room was emptied to set up, participants filtered out and sat on couches in the waiting room, greeting their friends and families. Some were nervous to present their hacks, but everyone was excited to see what solutions people came up with. They sped through the 20 presentations, with the audience gasping and cheering for each idea. Up front, Gustetic, Garan, the veteran tech consultant David Hochman, and Liz Barry, the Director of Urban Environment at the Public Laboratory of Open Technology, judged the completed hacks.

“I’m looking for how well the team collaborated together,” Garan explained. “What the potential is, you know, how realistic is it, how valuable is it, what type of impact can it make.”

The judges doled out six awards–four for each type of hack, two for entry to the international judging phase. Versioning Goat, a database that copies and syncs NASA’s data across different locations, won Best Open Data. Asteroid Mapper won Best Open Hardware. Roid Hopper, an interactive website with locations of near-Earth asteroids and a table of the time needed for a mission to each of them, won Most Galactic Impact. Chillin’ on Mars, won Most Inspiring. Tiny See Bots, a program where you can control an underwater robot over the internet, and MySpaceCalNYC, a calendar that outlines what each telescope will be pointing at for a given time, were nominated for international judging. MySpaceCalNYC went on to win at international judging and shared the global victory with projects from Philadelphia, Toronto, Kansas City, Jakarta, and a virtual collaboration between Florida and San Francisco.

Both organizers and participants are optimistic about the future of NASA Space Apps. “I see momentum growing from this year to next, and then, an upward trajectory,” Gustetic said.

What did it for Wangs was what he saw as a lack of competitive anxiety that invades similar hackathons. “This was very inspiring for me,” he said. “If I wasn’t here, I’d be cynical that such events could exist,”

Even after it all wrapped up, participants went on discussing the potential of their projects and the next stages of development. Many are also looking forward to evolving it beyond the confines of an annual event.

“I’d like for all these solutions and the networks built with the teams to continue,” Diaz explained. “Maybe next quarter we’ll have people get together again, and either enhance their application, or reach out to others and start developing a ground-swell of people interested in these challenges that we face.”

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Now back in Wellington, I’m delighted to reclaim authorship of my blog. My team did an excellent job keeping things current while I was away, but it’s good to be writing again myself. I thought I’d start with a few notes about NASA’s International Space Apps Challenge, which I judged in Auckland shortly after deplaning from New York City (via San Francisco) earlier this week.

Click through for image source.

The International Space Apps Challenge is a very American approach to problem-solving which convenes folks from around the world to collaborate on addressing challenges facing humans both here on Earth and as we venture farther out into space. Structured as a mass global crowd-sourcing exercise, the event brings participants together for 48 straight hours to advertise their expertise, access the skills of others, and work together in teams, wherever they happen to be located on the planet’s surface.

Last weekend the Challenge attracted more than 9,000 people and 480 organizations in 83 cities across 44 different countries on all 7 continents, as well as online from many other locations including the International Space Station. This year our Embassy and NASA were pleased to add Auckland to the list, and I am grateful to Auckland University of Technology for providing space and co-sponsoring the event with us. My good friend AUT Professor Sergei Gulyaev managed the local proceedings.

Venues for 2013 International Space Apps Challenge, including Antarctica, Lower Earth Orbit and Auckland.This year’s Challenge locations included Antarctica, Lower Earth Orbit, and Auckland.

Participants had 58 challenges from which to choose, each individually curated by NASA and its partners, including the National Science Foundation, European Space Agency, Japan Aerospace Exploration Agency, Centre National d’Etudes Spatiales, UK Space Agency, Department of State, mLabs, Tech Shop, Raspberry Pi, Cloud Signa, Leap Motion, Tumblr, and Geeks without Bounds.

The challenges included detecting near Earth objects, creating techniques to visualize invisible solar flares, predicting water contamination from data collected in space, creating a 3D printing framework for use in remote problem-solving in outer space, improving how NASA provides scientific data to the public, and creating tools to improve understanding of the tangible benefits that space exploration produces back on Earth.

Click through for image source.

The event was designed to engage people of varying backgrounds and all ages. Simply put, you did not need to be a rocket scientist, brainiac, or computer wizard to participate. Among the challenges that non-scientists like me might have enjoyed were creating a better poultry management system for backyard farmers, expanding the NASA GIRLS program to mobile and tablet platforms, envisioning and imaging what Kennedy Space Center Spaceport  might look like in the year 2040, …

… designing jewelry or wearable art that celebrates 55 Cancri E (a carbon-rich exoplanet), conveying through words and/or images why we should continue to explore space, creating a crowd-sourced gaming platform to evolve best ideas for future air traffic control and management, developing games related to space exploration, and designing a smartphone operation system to control a Lego robot. One of my favorite challenges was mapping from space the Peace Corps’ more than 50 years of humanitarian projects around the world.

click through for image source.Why go to all this effort? NASA explains it best:

“Our space program, more than ever, requires the active engagement of the public to co-create our shared future.

“This weekend demonstrated the true potential of participatory exploration and what can happen when an agency like NASA takes a chance on engaging the untapped, unexpected, and uncharted know-how of thousands of passionate citizens around the world.

“Innovation is bottom-up, decentralized and unpredictable. True innovation necessitates failure. The more you experiment, the more you fail, the more you learn. Small technologies and initial development deserve innovative process and the opportunity for failure. …

“At the International Space Apps Challenge we open up challenges of space exploration and social need and empowered citizens around the world to solve those challenges. … Passionate citizens are being asked to find and share their solutions to the challenges. In the process of planning and implementing the Challenge we have learned a lot and recognized the power released when we work together with others committed to changing the way the world works. Space Apps exemplifies a model for accelerating technology and we are capturing that story here to be built upon.”

Reviewing the presentations with fellow judges Candace and Matt.Reviewing the teams’ presentations with colleague judges Candace and Matt.

The event kicked off at 9.00 a.m. last Saturday morning in Auckland, with interested participants (mostly students) assembling, coalescing into four teams, and selecting specific challenges to address. For the next 48 hours the teams worked almost non-stop to develop solutions, reaching out online to compare notes, seek advice, or simply observe participants in other locations. Some folks brought sleeping bags and took naps on the floor from time to time, while a few slipped away home for some rest. The culmination of each team’s effort was an 8-minute presentation documenting and demonstrating their solution.

I landed in Auckland in time to get to AUT by 9:00 a.m. Monday for the presentations and judging. Joining me on the panel were Candace Kinser (CEO of New Zealand ICT Group) and Matt Bostwick (Microsoft NZ’s Tertiary Education Sector Manager), both of whom I had met earlier this year when we judged the Microsoft Imagine Cup. We spent an hour listening to the presentations, questioning the teams, and then scoring their solutions based on product design, impact, creativity, complexity, sustainability, and collaboration.

Team ‘Space Cadets’ listening to advice on their 3D Printing Challenge.Team Space Cadets hard at work.

Given the quality of the projects, judging was difficult. We ended up awarding honorable mentions to a team that designed a greenhouse for use on Mars and a team that developed a mobile app for collecting feedback from participants in NASA educational programs. Our first runner-up was Team Space Cadets, which imagined a platform to use remote 3D printing to address problems encountered during space exploration. We were particularly impressed with the wheel that the Cadets designed and printed that could be used to rescue a Mars rover stuck in soft soil.

The winning team in Auckland was Team Spot the Station, which developed an app for the android smartphone which will track and provide information about the International Space Station. A user of the app will receive an alert and directions when the station is visible from their particular geo-location. Users can then take photos, share their photos and observations, and check the status of experiments being conducted on the Station. The Cadets impressed us with their plans for improving, producing, and distributing the app.

Team ‘Spot the Station AUT’ with their winner’s trophy.Team Spot the Station, with trophy and judges.

Team Spot the Station and Team Space Cadets, as well as the top two solutions from each of the other Challenge locations, will be featured on in May, shared with scientists and educators at NASA and other partner agencies, and submitted for global judging in several categories. Prizes will include flight suits, 3D printers, space launch invitations, space flight training, and opportunities to collaborate with NASA and European Space Agency scientists on implementing certain of the applications and solutions.

As I said last Monday (and in every such competition in which I’ve been involved), however, getting a trophy isn’t the point. What matters is convening kindred spirits, building global networks, stimulating creativity, wrestling with big challenges, finding solutions, and celebrating practitioners of the scientific and technological arts, who contribute so much more to life on this planet than the folks we usually spend most of our time watching and cheering.

The official International Space Apps Challenge T-Shirt.

Again, thanks to NASA, AUT, Sergei, Candace, Matt, and everyone who participated in our inaugural International Space Apps Challenge event in Auckland. I’m confident that we’ll be back again next year, so I hope to see you there. If there is sufficient interest, we might even consider expanding to a second city.

Crowdfunding space

by Jeff Foust
Monday, April 15, 2013

On the morning of March 28, a handful of invited guests gathered at the headquarters of Hyper-V Technologies in the Northern Virginia suburbs of Washington, DC. Inside the nondescript building in an industrial park, next to a towing company, Hyper-V was developing, and about to demonstrate, some cutting-edge technology: a plasma jet electric thruster. Inside the control room, the Hyper-V team made some final checks, then flipped the switch, and the thruster came to life, pulsing at five hertz.

The goal of the test was to run the thruster for 60 seconds, but that milestone came and went and the thruster was still running smoothly. One of the company’s scientists, Andrew Case, continued to read out the elapsed time until, at 90 seconds, the head of Hyper-V, Doug Witherspoon, decided to end the test to avoid burning out any components. “Excellent!” he said to cheers and applause, as the thruster set a new firing duration record for the company.

While the thruster technology itself was innovative, what was also remarkable about the test was how it was funded. Hyper-V raised nearly $73,000 last fall through Kickstarter, a so-called “crowdfunding” web site that allows people to donate money to various projects, usually in exchange for products, gifts, or other forms of recognition. The March 28 test was designed to meet one of the goals of their Kickstarter campaign, to run the thruster for 60 seconds.

Hyper-V is not alone in turning to crowdfunding to support space-related projects. In the last year a number of companies and organizations have used Kickstarter and similar sites to raise modest amounts of money—only occasionally exceeding $100,000—needed for early stage development. It offers a way for companies to connect with larger groups of people who, individually, aren’t wealthy enough to back a project, but together can help a fledgling firm raise money, one of its biggest non-technical obstacles.

“On the small side, we’re seeing a lot of interesting things being done with crowdfunding,” said Hoyt Davidson, managing partner of NearEarth LLC, at the US Chamber of Commerce’s “Free Enterprise and the Final Frontier” event in Washington in February. “There’s a lot of interest among smaller investors to see things like this happen.”

One of the first successful space-related crowdfunding exercises was carried out a year ago by STAR Systems, a small venture in Phoenix that seeks to—eventually, at least—develop a suborbital spaceplane called Hermes (see “Hacking space”, The Space Review, April 23, 2012). STAR Systems raised just over $20,000 in its Kickstarter, allowing it to continue work on the hybrid motors that will power Hermes.

Mark Longanbach of STAR Systems said they took inspiration from a project on Kickstarter called KickSat, which raised nearly $75,000 in late 2011 to fund development of “chipsats,” or spacecraft the size of just a couple of postage stamps. “It was really my inspiration for realizing that the crowdfunding platform could be viable for actually getting some funding injected into your company,” he said during a presentation at the Space Access ’13 conference in Phoenix on April 12.

STAR Systems’s crowdfunding campaign and many other space-related efforts are quite different from more common uses of these platforms, which use crowdfunding to pay for product development and take pre-orders of new products. “They’re all based on the idea, the vision, they’re something the community can get behind because they can do something, they can make a difference,” Longanbach said. “You’re not just pre-selling an iPhone case or a charger or something like that, so it’s kind of a different mechanic versus a lot of other Kickstarter projects.”

One of the biggest successes in space-related crowdfunding has been LiftPort. Last summer, Michael Laine, seeking to revive the company that several years ago tried to develop technologies leading to a space elevator, set up a Kickstarter campaign to raise just $8,000 to fund a demonstration of robots climbing a two-kilometer tether suspended from a balloon. Then something remarkable happened: the campaign got picked up in social media as well as traditional media, and Laine ended up raising $110,353 by the time the campaign ended September 13.

“That took us from the hobby stage to, ‘Wow, I think we can do this for real,’” Laine said at Space Access. The Kickstarter funds will support experiments planned for May through July at increasing altitudes. Laine added a second Kickstarter campaign is in the works for August to help raise funds for a “String Sat” CubeSat to test tether technologies in orbit.

Others have used crowdfunding to support development of small satellites, technology development, and miscellaneous efforts. Rand Simberg used a Kickstarter campaign at first to support his research into spaceflight safety, raising more than $7,100. The result of that effort, he said at Space Access, was an “accidental book” called Safe Is Not an Optionwhich he raised more than $5,300 in a second Kickstarter to get published. The book is scheduled to be available in the coming weeks.

Crowdfunding has attracted a lot of interest in companies in aerospace and beyond because it’s seen as “free” money: unlike raising money from angel investors or other more traditional sources, crowdfunders don’t get an equity stake in the company, just access to a product, a gift, or even a feel-good sense of having supported a worthy cause. However, a lot of effort has to go into both the campaign itself as well as keeping the funders happy afterwards.

Laine said that of the $110,000 LiftPort’s Kickstarter raised, he ended up with about $99,000 after fees. The fulfillment costs for the various items people received for donating at various tiers ran about $45,000, he said. The unexpected surge in interest has also created delays in shipping out those items to donors. “It’s been eight months and I still don’t have all of my t-shirts out,” he said. His suggestion: “Have intangible rewards if you can.”

Laine’s effort attracted 3,468 backers, which creates complications of its own. Raising that much money “comes with a really high level of scrutiny, and you can’t make everybody happy,” he said. Most of those backers are happy, he said, but not all. In some cases, he said, people had the expectation that they were funding LiftPort’s long-term goal of a lunar space elevator, rather than an early-stage technology demonstration.

There’s also no guarantee of success. Golden Spike, the company that announced plans in December for commercial human lunar missions (see “Turning science fiction to science fact: Golden Spike makes plans for human lunar missions”, The Space Review, December 10, 2012), established a campaign on another crowdfunding site, Indiegogo, seeking to raise $240,000 to support outreach and design work. As of early Monday, with ten days left in the effort, Golden Spike has raised only about five percent of that goal.

Doug Griffith, a member of the board of Golden Spike, acknowledged the “very anemic” fundraising effort during a presentation at Space Access, but said the company was not giving up on using crowdfunding. He suggested that Golden Spike’s effort didn’t fit into two niches that work well in crowdfunding, particularly on Indiegogo: charitable efforts, and “supporting the underdog” competing against bigger companies and interests. “Golden Spike has been very challenging, and it’s not because people aren’t extremely excited about the idea,” he said, “but we don’t fit either of those two niches.”

Others are critical of crowdfunding because of the message it sends: that a company can’t attract more conventional investment. “This is fine for creative garage projects, but not for real companies,” said Ken Murphy, a space advocate who worked for more than two decades in the financial industry as an analyst, in an email interview. “It sends a bad message to real investors.”

One alternative has been in the works for a year now. The Jumpstart Our Business Startups (JOBS) Act, signed into law a year ago, directed the Securities and Exchange Commission (SEC) would allow for crowdfunded investment: people not wealthy enough to be “accredited investors” under SEC regulations could instead invest smaller amounts of money for small stakes in a company: like the crowdfunding on Kickstarter, but receiving equity instead of a t-shirt.

The problem is that the SEC is months past the deadline in the act to promulgate the rules for crowdsourced investing. SEC officials said earlier this month that they plan to release those regulations “as soon as we can,” but declined to set a timetable.

Murphy is worried the rules could subvert the intent of the legislation, which was to allow more investors to participate in companies, supporting the economy in general. “The JOBS Act is a way to grow the space industry, if the government will let us,” he said.

So for now, companies continue to turn to portals like Kickstarter to win small amounts of funding. At Hyper-V, the success of last fall’s Kickstarter has led them to consider doing it again. “We’re thinking about it,” Witherspoon said. “We’re not sure if we’re going in that direction or not.” A more conventional alternative, he said, would be to apply for an SBIR award from a government agency.

“It’s not as easy as it looks,” Laine said of crowdfunding, “and it’s not as hard as it looks.”

Jeff Foust ( is the editor and publisher of The Space Review. He also operates the web site and the Space Politics andNewSpace Journal weblogs. Views and opinions expressed in this article are those of the author alone, and do not represent the official positions of any organization or company, including the Futron Corporation, the author’s employer.

Prizing success in aerospace innovation (Baltimore Sun),0,3148111.story

By Darryll Pines12:37 p.m. EDT, April 17, 2013

The future economic growth and competitiveness of the United States depends on our capacity to innovate. Many ideas have emerged from government, industry and academia regarding how best to inspire and support innovation. But nothing spurs creativity and innovation more than a combination of incentive and challenge: a reward for achievement, combined with the urgency of a dare to succeed and the reality that we must race against others. We are at our best when we compete.

This is why I believe that prizes and competitions are crucial to create a climate of innovation and entrepreneurship, and for driving new advances in targeted areas. At the University of Maryland, I have personally seen the positive impact that competing for external prizes has had on the development of our students. In 2012, our Gamera student team set the world record for the longest human-powered helicopter flight. The $250,000 American Helicopter Society’s Sikorsky Prize has fueled the team’s drive for success.

The aerospace industry presents a compelling case study of the considerable impact that prizes and competitions can have. Innovation in aerospace has historically kept the U.S. at the forefront of technology advances and helped create new industries, such as the commercial transport of people and cargo, unmanned aerial systems for civilian and military missions, and, more recently, commercial space travel.

A key catalyst for these advances has been the establishment of aerospace prizes and competitions to accelerate invention, ingenuity and investment. When competitions and prizes are properly posed, they can inspire creativity, invention, and entrepreneurship; leverage external financial investment that is typically 5 to 10 times the prize value; bring diverse groups of people together to solve a single problem; accelerate technology advances; and launch new industries, boosting job creation and economic development.

The Orteig Prize, established in 1919 by hotel owner Raymond Orteig, offered $25,000 for the first nonstop aircraft flight between New York and Paris. On May 21, 1927, Charles Lindbergh completed the first solo transatlantic flight in history in 33 hours and 30 minutes; aircraft industry stocks rose in value and interest in flying skyrocketed. Lindbergh’s subsequent tour in the “Spirit of St. Louis” demonstrated that the airplane was a safe, reliable mode of transportation. That year, applications for pilot licenses in the U.S. tripled and the number of licensed aircraft quadrupled.

Years later, a community of aviation enthusiasts sought to realize the human-powered flight dreams of Leonardo da Vinci. British industrialist Henry Kremer established the Kremer Prize in 1959 to accelerate advances in human powered flight. The prize value was originally 5,000 British pounds and later increased to 50,000 pounds.

Paul MacCready and his team won the first Kremer Prize for flying a figure eight in 1977 with his Gossamer Condor aircraft, flown by cyclist Bryan Allen. MacCready’s team won a second Kremer Prize in 1979 by crossing the English Channel in 2 hours, 49 minutes in their Gossamer Albatross.

In 1988, another group led by John Langford of MIT pushed human powered-flight further. The team’s Daedalus vehicle flew 71.5 miles in less than four hours, the world records for distance and duration for human-powered aircraft.

Advances associated with these human-powered flights led to the emergence of high-altitude, long-endurance, unmanned aerial vehicles such as Aurora Flight Sciences and AeroVironment. Today, these two aerospace firms employ approximately 1,000 people.

The X Prize, first proposed by Peter Diamandis in 1995, was designed to demonstrate that a private vehicle could be flown to the edge of space, to show spaceflight could be affordable and accessible to civilians, opening the door to commercial space tourism.

The $10 million prize, later renamed the Ansari X Prize, was awarded in 2004 to aerospace pioneer Burt Rutan and Microsoft co¿founder Paul Allen, and their space plane SpaceShipOne.

Subsequently, a number of commercial space companies emerged to support the demand for launch services, satellite development, space science and education, and space tourism. Commercial space transportation boosted economic activity, employee earnings, and job growth in the aerospace industry.

Back at the University of Maryland, our Gamera team, fresh off last year’s success, is now involved in an exciting “international aerospace race” with Canada’s AeroVelo team to see who can capture the 32-year-old prize first. No matter who wins the prize, the journey will be worth the investment of time and resources to inspire the next generation of innovators to push science and engineering to its limits.

Competing brings out the best in us. If our goal is to truly inspire and support innovation, we should work together to create more high-value prizes in areas where this work is needed most urgently.

Darryll J. Pines is dean and Nariman Farvardin Professor of Aerospace Engineering at the Clark School of Engineering at the University of Maryland. At UM, he has emphasized the importance of helping students achieve success in national and international student competitions. His email is

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How Kaggle Is Changing How We Work


The job fair of the future (Facebook).

The technology industry loves its laws. There’s Moore’s Law of processing power, Metcalfe’s Law of networks, and Gilder’s Law about bandwidth.

And then there’s Joy’s Law, a more obscure truism named after Sun Microsystems co-founder Bill Joy. “No matter who you are,” Joy is said to have said, “most of the smartest people work for somebody else.”

For decades this koan about the scarcity of labor and expertise has held true, because of both economics and geography. The problem isn’t merely thecost of hiring the smartest people, but the other frictions in the labor market that prevent companies from finding the right people, knowledge- and skills-wise.

But Joy’s Law may not be sacred for much longer. A new wave of startups are bringing innovation to several labor markets, making the smartest people in the world available and employable by anybody (for a price). There’s no better example of this than Kaggle.

Founded in 2010, Kaggle is an online platform for data-mining and predictive-modeling competitions. A company arranges with Kaggle to post a dump of data with a proposed problem, and the site’s community of computer scientists and mathematicians — known these days as data scientists — take on the task, posting proposed solutions.

Importantly, competitors don’t just get one crack at the problem; they can revise their submissions until a deadline, driving themselves and the community towards better solutions. “The level of accuracy increases, and they all tend to converge on the same solution,” explains Anthony Goldbloom, Kaggle’s co-founder and CEO.

Companies as varied as MasterCard, Pfizer, Allstate, and Facebook (not to mention NASA) have all created competitions. GE sponsored a contest to give airline pilots tools to make more efficient flight plans en route. Health technology company Practice Fusion funded another challenge to identify patients with Type 2 diabetes based on de-identified medical records.

Prizes for the winning solution have ranged from $3,000 to $250,000. A $3 million prize, offered by the Heritage Provider Network for the best prediction of which patients will be admitted to a hospital within the next year, based on historical claims data, closed last week, and the winner will be announced in June at the Health Datapalooza.

The key to Kaggle is the community: 85,000 data scientists (who knew there were that many data scientists in the world!) have entered competitions, and each is ranked according to their skill and results in competitions. Xavier Conort, a French actuary living in Singapore, holds the Number One spot (he’s won 6 prizes and come in the top 10 percent a dozen times). As I’m writing this, Joshua Moskowitz, an American who joined 9 minutes ago, is at the other end of the pecking order. Just wait till Joshua starts competing, though; he could be a challenge Xavier in a matter of months.

That everyone-has-a-chance ethos means that any competitor, no matter how isolated they may be, can judge their talents against the top rank of their field. What’s more, in the company’s forums competitors can swap techniques and hone their skills. Goldbloom says that a good programmer can work their way up the ladder fairly quickly, by scoring well in two or three competitions.

The really disruptive thing about Kaggle, though, comes through the company’s new service, Kaggle Connect. Here, Kaggle acts as a match-maker, where customers with a specific problem can hire a specific data scientist well-suited to their problem; candidates are drawn the top tier of Kaggle participants: the top 1/2 of 1 percent, or about 500 data scientists.

Which means that now you can hire Xavier, or one of the other best data scientists in the world — if you can afford them. Or, if you’d rather pay less, you can go down the tail to people less highly ranked, but still with the Kaggle seal of approval.

On one level, of course, Kaggle is just another spin on crowdsourcing, tapping the global brain to solve a big problem. That stuff has been around for a decade or more, at least back to Wikipedia (or farther back, Linux, etc). And companies like TaskRabbit and oDesk have thrown jobs to the crowd for several years. But I think Kaggle, and other online labor markets, represent more than that, and I’ll offer two arguments. First, Kaggle doesn’t incorporate work from all levels of proficiency, professionals to amateurs. Participants are experts, and they aren’t working for benevolent reasons alone: they want to win, and they want to get better to improve their chances of winning next time. Second, Kaggle doesn’t just create the incidental work product, it creates a new marketplace for work, a deeper disruption in a professional field. Unlike traditional temp labor, these aren’t bottom of the totem pole jobs. Kagglers are on top. And that disruption is what will kill Joy’s Law.

Because here’s the thing: the Kaggle ranking has become an essential metric in the world of data science. Employers like American Express and  the New York Times have begun listing a Kaggle rank as an essential qualification in their help wanted ads for data scientists.  It’s not just a merit badge for the coders; it’s a more significant, more valuable, indicator of capability than our traditional benchmarks for proficiency or expertise. In other words, yourIvy League diploma and IBM resume don’t matter so much as my Kaggle score. It’s flipping the resume, where your work is measurable and metricized and your value in the marketplace is more valuable than the place you work.

“We’re solving a market failure,” says Goldbloom. “People were using really poor proxies” for skills and credentials. That’s the big shift here. Kaggle represents a new sort of labor market, one where skills have been bifurcated from credentials. (Tom Friedman, among others, has been beating on this drum of late).

Obviously, data science and computer code is particularly well suited to such a market. It’s digital, and the product is easily measured in both quality and efficiency. But this doesn’t mean that other fields won’t follow. It was the same way with open source software and other easily digitized fields — at first seems like only work with code. But then the model starts to get adopted and adapted by other industries that figure out how to inject the same magic into their fields.

You don’t have to look hard to find other new companies that are building similarly disruptive labor marketplaces: 99Designs has created a contest-based community of designers, and has paid $51 million to designers for their winning contributions at a current rate of $1.8 million per month. And HealthTap has for created a community of 30,000 doctors who are using their spare cycles to answer patients’ healthcare questions, and are scored on the quality of their contributions. Founder Ron Gutman calls HealthTap an “arbitrage market for physicians,” that’s connecting a market need for expert healthcare advice with the suddenly available commodity of doctors with a few minutes on their hands. The company has even started a ClubMDfor top-ranked doctors that comes with special posting privileges.

Though he was skeptical at first, Goldbloom conceded that even professions that don’t seem particularly quantitative might be similarly arbitraged. Take lawyers, for example – how would you rate them? But after a moments thought, Goldbloom had cracked it: you could pretty easily rank trial lawyers by their courtroom victories, or personal injury attorneys by their settlement amounts. And soon, it became clear that nearly every profession have some sort of metric for success, not just in terms of outcomes (which can measure success) but also in terms of process (which can measure efficiency).

And suddenly, Joy’s Law doesn’t seem so sacred any more

Crowdfunding Shoots for the Moon

Alan Stern, a planetary scientist and former NASA executive, is the president and CEO of Golden Spike and he contributed this article to’s Expert Voices: Op-Ed & Insights.

I’ve been involved in “bigscience” for more than 20 years, having led or personally participated in science teams for 24 suborbital, orbital and planetary space missions with a total value of over $3 billion.

I’m a planetary scientist and a former NASA associate administrator, and when I led all of the agency’s science programs, I had a budget of more than $5 billion.

These days, I’m still doing big science, but I’m spending time at the other end of the funding-scale spectrum: I’m a science crowdfunder.

For the uninitiated, crowdfunding is an online phenomenon that allows anybody with a few bucks to spare to contribute toward the budget of a project, usually a startup, seeking cash. Anybody with an idea can go to one of dozens of specialized crowdfunding websites and appeal to the general public for donations, usually in small denominations, and usually in exchange for T-shirts, project participation or other small giveaways. It’s kind of a National Public Radio-style fundraising campaign involving the entrepreneurial masses.

I got involved in crowdfunding to give birth to a whole range of ongoing space research and education projects, starting a company called Uwingu. Currently, I am working to fund a new commercial space venture — the Golden Spike Company — as it begins to enable humans to once again explore the moon. Golden Spike is the world’s first aerospace firm planning to sell human lunar expeditions to countries, corporations and individuals around the world.

Crowdfunding has become hugely popular. According to the industry website, there were 452 crowdfunding platforms active worldwide as of last April. In 2011 alone, crowdfunding raised nearly $1.5 billion. That amount doubled to $3 billion by the end of 2012, and looks set to rise further in 2013.

Artists of many stripes quickly embraced crowdfunding as a way to cultivate an audience for their work, even before hammering the first chisel mark into a sculpture. Similarly, social causes and individuals with innovative business ideas also quickly adopted crowdfunding. But, scientists and research teams have been far more reticent — even skeptical — of appealing to nonscientists for project support in recent years.

However, harsh financial realities — including repeated cuts in government-funded research and technology programs and a reluctance of big companies to spend funds outside narrow areas of interest — have forced a rethink. What more and more scientists are now discovering, as I did, is that engaging the public can be stimulating, rewarding, consequential and even inspiring, and it’s a trend that’s likely to grow.

That was the experience I had last year when seven colleagues and I launched the Uwingu campaign on the crowdfunding website. The idea was to create a new funding stream for space researchers and educators outside of the federal agencies that normally fund space research and education, diversifying the funding landscape.

Uwingu’s crowdfunding campaign was successful — in fact, it was one of the 25 most successful Indiegogo campaigns ever — with almost $80,000 raised to start the venture. And from that, we’ve been able to launch our website and begin operations.

What was most rewarding about this experience was the excitement those of us involved in the campaign could sense from the comments and feedback we received from funding supporters.

That’s why I’ve returned to crowdfunding again, this time for the Golden Spike Company. The money we are looking to raise from Indiegogo is largely symbolic: $240,000 represents $1 for every mile from the Earth to the moon, a figure we believe will resonate with people.

By giving the public a chance to directly fund these commercial space efforts, we hope to create a greater sense of public involvement in space exploration. But the money we want to raise is also meaningful and will help us start our business.

In my world — the space world — it’s often been said that if there are no bucks, there won’t be any Buck Rogers. No doubt.

But what I’ve now learned through my crowdfunding experience is that there is a corollary to that famous adage: You can’t expect Star Trek unless you also make the effort to cultivate its Trekkies.

To participate, or learn more about Golden Spike, visit our Indiegogo website — the campaign ends in just two weeks.

The views expressed are those of the author and do not necessarily reflect the views of the publisher.