Five Trends in Large Prize Competitions

When Lever for Change launched five years ago, prizes of more than $10 million were relatively uncommon. That has changed: a growing number of philanthropists are employing challenges, prizes, and open calls to make larger awards more quickly and more equitably than previously established forms of grantmaking.

One result is that prize designs have improved; at Lever for Change, we do our best to learn from other, often ingenious, efforts of our peers, and to share what we are learning with others. Much of our feedback comes from the organizations that participate in our open calls and challenges.

I wanted to share my appreciation for the way that Lever for Change is delivering the Build a World of Play Challenge scoring and feedback. Communication and feedback through the process has been incredibly efficient and thorough. In all my time as a fundraiser, I have never received such detailed feedback on an application, let alone at such an early stage in the process. It shows that both Lever for Change and [the sponsor,] the Lego Foundation respect the time and resources that organizations have put into their application.
Gabby Atwood - Partnership Development Lead for Action for Children.

Applicant feedback like this drives our processes at Lever for Change. A collaborative approach is central to our brand of philanthropy: we know that today’s problems may be too big for any single entity to take on. Like those committed to prize philanthropy, we believe good ideas can come from anywhere. We keep our eyes on prizes and new approaches to challenge design and management that can move more funding to better projects faster than traditional philanthropy. Building from a study our colleague Yoon-Chan Kim authored in 2022, we’ve continued scanning the landscape for innovative prizes and competitions. By sharing some of the best practices we’ve seen, we can continue improving on competition design and move the needle on critical social issues together.

We have identified five general trends in prize philanthropy since our launch, shared not only by Lever for Change challenges but also numerous other prize entities:

1. Few prizes exceed $10 million, but there are more of that size now than ever before.

When Lever for Change launched in 2019, even one-million-dollar awards were unusual. For years, funders had talked about making fewer but larger grants. Yet, even in 2022, the average grant by the average foundation with $1 million to $500 million in its endowment was just $28,000, according to The Foundation Source's 2023 Report on Private Philanthropy: Giving and Investment Trends within Private Foundations. That’s not true in prize philanthropy, where awards of $10 million to $100 million are increasingly common.

2. Most donors rely on outside services to manage prize administration.

Relying on outside expertise to professionally manage prize delivery is increasingly common. Carrot, XPRIZE Foundation, Challenge Works, and Lever for Change stand out as top administrators for large-scale prizes, as of 2023. At Lever for Change, we facilitate a number of challenges for a variety of donors including high-net worth individuals, donor collaboratives, and foundations.

3. Technology is central to prizes.

Larger prizes are often associated with living donors from the tech sector. Jeff Bezos, MacKenzie Scott, Melinda French Gates, and Elon Musk have all announced large prizes or prize programs above $10 million, as has Google.org.

4. Challenges continue to build momentum for the causes they seek to serve.

Prizes allow the philanthropic ecosystem to find additional ways to increase awareness and collaboration about the very issues they work on. Many challenges host events or continue to raise money for the cause. At Lever for Change, our Bold Solutions Network is a growing global network of highly rated organizations sourced across our challenges that are well-positioned to secure additional funding, amplify their impact, and accelerate social change. We consistently share information about our members with other donors looking to fund in these areas.

5. The credibility of prize awards can be improved by ensuring the judging process is clear and transparent, and by carefully selecting judges. Donors who fund prize competitions must offer incentives to participate, including giving applicants a fair hearing. A judging process that is open, provides valuable feedback, and is endorsed by respected individuals serving as judges can help with this. At Lever for Change, this is central to every challenge we manage.

These trends showcase just how prize philanthropy can be responsible philanthropy, especially when it is thoughtfully designed. We are proud to work with so many donors and organizations to continue building out challenges that are inclusive, equitable, and effective. If you would like to work with us on designing your next funding challenge, contact us today and find out how we can help you achieve your philanthropic goals.

For deeper illustration of these trends across last year’s landscape, below are nine prize profiles in the categories of those awarding above $10 million, as well as those between $5–9 million.

AI For the Global Goals

AI for the Global Goals awarded $25 million to 15 organizations in 2023 as part of Google.org’s commitment to the UN Sustainable Development Goals, with a focus on solutions utilizing AI to address them.

The primary donor and prize administrator is Google.org.

TOTAL FUNDING: $25 MILLION

Housing Affordability Breakthrough Challenge

In its second cycle, the 2023 Housing Affordability Breakthrough Challenge split $20 million among 6 housing innovation organizations. The cohort of both cycles receive technical expertise from Enterprise, a national leader in the affordable housing industry, showcasing a rarity for a prize administrator to conduct direct service work alongside its awardees.

The primary donor is Wells Fargo & Company and the prize administrator is Enterprise Community Partners.

TOTAL FUNDING: $20 MILLION

Water Breakthrough Challenge 4

The fourth Water Breakthrough Challenge launched two "streams” (i.e. applicant tracks) for entry, with the “Transform Stream” track winners eligible for £10 million ($12.75 million USD) each to their water-focused projects. This challenge is one of two examples of 2023 with individual prize awards above $10 million (with XPRIZE Healthspan being the other).

The primary donor is Ofwat Innovation Fund and the prize administrator is Challenge Works.

TOTAL FUNDING: £40 million (~$51 million USD)

XPRIZE Healthspan

A seven-year global competition, XPRIZE Healthspan will award $101 million to the top team showcasing technological advances working to address human aging, with an additional $10 million awarded to the top team focusing on muscular function. This is the largest individual award provided to date, and further affirms technology as the top priority in large-scale funding topics.

The primary donors are Hevolution and Solve FSHD and the prize administrator is XPRIZE Foundation.

TOTAL FUNDING: $111 MILLION

XPRIZE Wildfire

Launched in 2023, XPRIZE Wildfire is a 4-year competition to innovate firefighting technologies that will end destructive wildfires. The prize pot will continue to raise over the challenge timeline, encouraging involvement from other donors—a unique approach counter to pre-set donor award commitments.

The primary donor is the Gordon and Betty Moore Foundation and the prize administrator is XPRIZE Foundation.

TOTAL FUNDING: $11 MILLION

The Earthshot Prize

Prince William and a distinguished Prize Council have committed to awarding £1 million Earthshot Prizes to five winners, one per ‘Earthshot’ (i.e. distinguished environmental goals), every year this decade. Using a rigorous nomination process, the Prize cuts out organizations’ time and capacity required by application processes. The attention granted to the prize and its winners has been remarkable and shows how prizes can be used to direct attention to global problems.

The primary donor is the Global Alliance of donors and the prize administrator is the Earthshot Prize.

TOTAL FUNDING: £5 million (~$6.37 million USD)

The Elevate Prize

The Elevate Prize provides $5 million each year to a group of ten extraordinary individuals. As an issue-agnostic prize, Elevate highlights the landscape of good work without thematic limitations. Initially, the Elevate Prize Foundation utilized MIT Solve’s professional competition management services, but has now strengthened capacity to provide its own. Another great example of a high-profile prize, Elevate draws a large audience reach through its goal to “Make Good Famous.”

The primary donor and the prize administrator is The Elevate Prize Foundation.

TOTAL FUNDING: $5 MILLION

Grand Challenges AI

The Bill & Melinda Gates Foundation provided $5 million in 2023 towards 48 projects utilizing AI for global health and development. The Grand Challenges initiative has existed for over 20 years spanning various topic areas, and 2023 saw the introduction of AI in its funding focus.

The primary donor and the prize administrator is the Bill & Melinda Gates Foundation.

TOTAL FUNDING: $5 MILLION

The Sustainable Cities Challenge

As part of the Sustainable Cities Challenge, ten cities were shortlisted in 2023. Three will be selected as hosts for open innovation challenges in 2024 that will run through 2026, distributing $9 million to organizations focusing on mobility. A meta-challenge that assists winners in designing their own challenges is a new idea.

The primary donor is the Toyota Mobility Foundation and the prize administrator is Challenge Works.

TOTAL FUNDING: $9 MILLION