The hallmark of a true entrepreneur is the ability to take something that most see as valueless and transform it into something valuable. However, it is one thing to have an insight about how to make something valuable, it is another thing to obtain funding to move the project forward. Prize competitions and other crowdsourcing options can help entrepreneurs to bridge the gap between idea and reality by providing the necessary funds to commercialize their ideas. Recently, Daniel Oldham helped start Bio-Adhesive Alliance and was able to commercialize a process to convert pig manure into an adhesive that makes asphalt by winning a series of prize competitions.
Oldham and the Bio-Adhesive Alliance team saw a problem and found a solution. They noticed that the price of asphalt was skyrocketing due the rising cost of the petroleum-based adhesive used in the manufacturing process. If a renewable adhesive could be found to make asphalt, then the price would remain stable. Oldham, a graduate student at North Carolina Agricultural and Technical State University, worked with a team of scientists and engineers to develop such an adhesive. Through their experiments, they discovered a process that converted pig manure into an adhesive substance yielded the best results. Oldham also recognized that swine farmers were anxious to have the manure removed from their farms because they were legally required to dispose of the waste. This creates a win-win situation: Pig farmers can dispose of waste product and convert it into something that can stabilize the price of manufacturing asphalt.
Rather than courting venture capital as a source of funds, the team at Bio-Adhesive Alliance submitted their designs and prototypes to a wide variety of competitions. The initial invention of the manure to asphalt process was funded by grants to NC A&T. The competitions provided the funding necessary to take the next step and actually commercialize the process. Some prize competitions are set up by non-profits in order to encourage start-up enterprises in a particular field. For example, Bio-Adhesive Alliance won the 2013 MassChallenge Award for $50,000. MassChallenge is set up to encourage independent innovation in all areas. The hope is to drive economic growth by supporting entrepreneurial start-ups in all industries. Other competitions are funded by the government. Bio-Adhesive Alliance also won $100,000 from MegaWatt Ventures, a competition for businesses working on clean technology. This competition is sponsored by the Department of Energy. Oldham and Bio-Adhesive Alliance brought in over $250,000 through these and other competitions. With these funds, they were able to commercialize their process for turning pig manure into a renewable adhesive for asphalt. They are now exploring other uses for the manure-based adhesive.
Now that Bio-Adhesive Alliance has successfully commercialized their idea, other sources of funding are opening up. Major players in the asphalt industry are ready to invest in an idea that might not have seen the light of day if it were not for the funds provided by prize competitions. Oldham and Bio-Adhesive are not alone. There are many other entrepreneurs with amazing innovative ideas who can benefit from prize competitions.
These prize competitions provide good opportunities for entrepreneurs to get their projects off the ground. Instead of shackling entrepreneurs to controlling investors, these competitions free them up to experiment and play with the most innovative possibilities. The fate of an idea is determined by its merits not by the constraints of investors. Entrepreneurs apply for these competitions by submitting business plans, executive summaries and supporting documentation. Funds from the competition help the entrepreneur to make these plans a reality.
Prize competitions are just one of many ways that entrepreneurs, like Oldham and the team at Bio-Adhesive Alliance, can obtain funds outside of traditional investments. Since anyone with an idea can apply, these competitions allow innovation to flourish outside of traditional university and corporate research labs. Other avenues for obtaining funds include crowdfunding platforms where small individuals contribute to projects that interest them. These new sources of funds are throwing the doors of innovation wide open to anyone with a good idea.