As the saying goes, ideas are cheap--it’s execution that matters. So what exactly is an idea worth? About $10,000, according to Damon D’Amore. D’Amore is the founder and CEO of WayFounder, a startup that aims to take the best ideas from people all over the world who are constantly dreaming up ways to solve problems but don’t quite want to quit their day job and start a business of their own.“What we say is, 'hey, if you're not an executor, if you don't have the tools and capacity to go build something, and you're relying on somebody else--yes, they need to be rewarded for that,” says D’Amore. “But you should be rewarded for the idea that's incentivized them to take the risk on your idea, versus the hundreds of other ones that they get presented.”
It works like this: Every quarter, WayFounder holds an open online competition. For 10 dollars, anyone can submit one idea for a consumer app or product in any of four given categories--one idea for each category, a maximum of four entries for each 10-dollar fee. Applicants are encouraged to include as much information about their business idea as possible in addition to answering a lengthy questionnaire.
At this point, it’s judged by WayFounder board members and guest judges from the startup community. Winners--up to one from each category--will get paid $10,000 and WayFounder will invest $50,000 toward bringing that idea to market. If it sells, the winner gets royalties, and if it sells well enough to spawn its own company WayFounder will invest $250,000 to get it started, with the winner getting 5% equity.
It would be easy to reductively consider WayFounder to be a mere crowdsourced idea competition, but to do so would be to ignore the most interesting parts of its business model. Like Quirky--a startup that crowdsources nearly every aspect of product development to reliably market products that sell--WayFounder aims to be a startup of startups and democratize the startup industry the same way Quirky flattened product development.
“I want to look at a map of the country, and I want to see 25 yellow pins that are people that have ideas that we empower by taking their ideas and putting them in the hands of 25 orange pins, people who have executed and built companies,” says D’Amore. “And each one of those companies might have three to five employees, they might have 20 to 50 employees, but regardless, there are people across the country that we've empowered with the knowledge and experience to then go on and teach others how to take an idea through the customer development process and take it to market.”
D’Amore sees WayFounder not only as a way to provide the idea generators he calls Nontrepreneurs compensation and the joy of seeing an idea of theirs come to life, but as a completely different model for launching startups. “When I sit on [investor] panels,” says D’Amore, “You hear people saying there can be a great 30-million-dollar business in the audience but we can't invest in you because we need to find the next Facebook.”
“We're not gonna build the next Dropbox, or the next Facebook or Snapchat or whatever it might be,” D’Amore admits. And that’s fine. WayFounder wasn’t conceived with that in mind. Instead, it could be argued that WayFounder’s model was developed on the gambit that good ideas have a long tail--the company doesn’t need to find a massive breakthrough of an idea to back, but rather a large number of smaller moderately successful ones.
Because, yes, ideas are everywhere. But that doesn’t have to mean they’re cheap.
[Image: Flickr user Quinn Dombrowski]