2.3 InnoCentive

InnoCentive is the global leader in crowdsourcing innovation problems to the world’s smartest people who compete to provide ideas and solutions to important business, social, policy, scientific and technical challenges.

Its global network of millions of problem-solvers, proven challenge methodology and cloud-based technology combine to help clients transform their economics of innovation through rapid solution delivery and the development of sustainable open innovation programmes.

Since 2001, InnoCentive has been making a profound impact on the world:

total registered solvers: more than 270,000 from nearly 200 countries

total solver reach: 12+ million through their strategic partners (e.g. Nature Publishing Group, Popular Science, and The Economist)

total challenges posted: 1,500+ external challenges and hundreds of internal challenges (employee-facing)

project rooms opened to date: 450,000+

total solution submissions: 34,000+

total awards given: 1,300+

total award dollars posted: $37+ million

range of awards: $500 to $1+ million based on the complexity of the problem and nature of the challenge

average award rate: 57 per cent.

InnoCentive adopts the electronic marketplace business model. Through its open innovation marketplace, InnoCentive seeks to match a global network of solvers with R&D challenges faced by a number of seeker organizations.

Seekers post challenges, along with the associated financial award, by paying InnoCentive a fee of $35,000 and are allowed to post challenges anonymously to avoid competition-related issues. Solvers can view the challenges and submit solutions to any challenge without being charged anything. If the seeker is satisfied with the workability of the solution to a challenge provided by a solver, then the seeker provides this solver with the pre-specified award in exchange for the acquisition to the intellectual property (IP) rights to the winning solution. The seeker also pays InnoCentive a commission on the amount awarded. InnoCentive ensures IP protection for both seekers and solvers and facilitates the transfer of IP rights from the solver to the seeker.

The value proposition that the business model offers is twofold:

  • First, InnoCentive allows seeker organizations to reduce their R&D budget by tapping into the wisdom and innovative capacity of a network of more than 200,000 solvers in order to find solutions to their difficult problems (challenges).
  • Second, InnoCentive gives solvers the opportunity to focus on a range of challenging problems that are of interest with the hope of receiving a financial reward.

Source: author


1. Which characteristics of an ‘open system model’ does InnoCentive demonstrate?

2. How does InnoCentive deliver value to its customers?

3. What do you think about crowdsourcing?

4. Why does the company have to post its problems on a blog?

5. How do you define the relationship between the organization and its network?