Two weeks ago Danielle asked me what I thought of entering the WE Media Pitch IT! Challenge. I took a quick look at the site and quipped “I don’t see a downside”. I knew that Danielle had most of the information needed for the application ready to go and a strong network of Food+Tech Connect readers, Twitter followers and Meetup group members to engage as potential voters in the challenge. A quick cost-benefit analysis made the challenge seem worthwhile. The allure of $25,000 in seed funding was a siren’s call.
However, the Murphy’s Law of entrepreneurship should be that if you don’t see ANY downsides you haven’t thought through the idea. There is ALWAYS a downside or risk. And the job of an entrepreneur is to identify the downsides and the risks and then make appropriate judgments about which risks to take on.
For online contests the downside risks are:
Nemessanyi goes on to recommend a “game-changing” redesign of these contests so that every ‘loser’ walks away with some legitimate value, in exchange for the gift of their very scarce time and no pay. Optimally, it should be value that feeds back into their business. After all, isn’t the larger goal more and better startup businesses that succeed?
Here are Nemessanyi’s off the cuff ideas for enhancing the “Loser Experience”:
The downside of online competitions for funding or pitch contests was clearly highlighted through Danielle’s experience in the WE Media Pitch IT! Challenge. The jury is still out on whether entering the challenge was a good idea (or not) for Food+Tech Connect. TIME is the factor that drives success. And for Danielle, time is the one resource that is already too tight.
The one outcome we can control right now about this contest is to be sure to learn from this campaign so we can do better risk-evaluations and improve any social media campaigns Food+Tech undertakes in the future.
What do you think about online contests? Are they a good use of time and relationships? What makes them worthwhile (or not)?