Most know that aviator Charles Lindbergh was the first to fly solo across the Atlantic in his aircraft, the Spirit of St. Louis, in May 1927.
Fewer remember that he earned $25,000 in prize money accomplishing the feat.
Lindbergh and his team were competing for the Orteig Prize, one of several offered to pilots and engineers in order to spur innovation and public interest in the then-nascent aviation industry The idea of using challenge prizes to tackle tough technological problems lay dormant for decades but has come back into vogue with government agencies, including those in the Defense Department, using them as an acquisition tool.
The Obama administration, with bipartisan support from Congress, has accelerated prize offerings, setting up the website Challenge.gov as a one-stop clearinghouse for all the prizes being offered by the federal government. Administered by the General Services Administration, it also offers technical advice to agencies wanting to set up their own competitions.
From its inception in 2010 to the end of fiscal year 2014, the website listed 370 competitions being sponsored by 69 different federal agencies. Together, they have offered some $72 million in prize money, said Tarnmi Marconilier, program manager of Challenge.gov.
"When you have a prize competition, you are capturing the imagination of the public and you are tapping into the wisdom of the crowd," she said in an interview.
The 370 competitions have attracted about 44,000 teams from around the world, she added.
Challenge prizes are not substitutes for traditional acquisition or procurement programs, but can be a tool for agencies seeking to bridge a technology gap, she said.
"If you can buy it, if it exists, if you can procure it, you should do that. It's not meant to get something cheaper that already exists out in the marketplace," she said.
Prizes must be well designed and look for a "sweet spot" between the "achievable" and "audacious." The prize must drive innovation, she said.
Chris Frangione, vice president of prize development at the XPrize Foundation, noted that the idea to spark innovation goes back further than the 1920s. It was the British government, not private individuals, that awarded the Longitude Prize to John Harrison in 1765 for discovering a simple and practical way to measure a ship's longitude. He earned 15,000 British pounds for inventing the chronometer. "They are really only one tool in your innovation toolbox, but they complement traditional research and development resources very...