How Olympic Innovation Can Help You Rethink Your Business
How the Olympics are shining
a light on an innovation that will
So what is the greatest innovation in U.S. Olympic history and why should you care?
Well, the innovation is not the BMW-designed USA bobsled, instantaneous video replays on iPads, or Shaun White’s new “Frontside Double Cork 1440” in halfpipe.
My friend and co-worker John Coyle, a silver medal-winning speed skater currently in Sochi helping the world understand his sport, tells me that the greatest innovation for Olympic athletes may just be “crowdfunding”—a tool he wishes he had when he was pinching pennies to have enough money to become an Olympic athlete.
Now, you may not care about crowdfunding, but if you are an entrepreneur or if you are charged with helping your company come up with new products or services, you are going to be intrigued by the process that led to it and how it is helping to solve a huge market need. Taking a new look at old problems is something that every company needs to do today.
But first, a quick primer on crowdfunding to make sure we are all on the same page. It is the practice of funding a project or venture by raising many small amounts of money from a large number of people. Today, it often happens via the Internet.
There is now a suite of relatively new online social media tools—such as GoFundMe.com, Indiegogo.com, www.dreamfuel.me and RallyMe.com—that allow athletes, Olympians and potential Olympians to cash in on the largesse provided by the intersection of goodwill and need.
By using the power of social media to gather a large number of small donations, athletes are able to find financial support to cover their expenses.
The list of athletes receiving significant support is substantial, John told me—from Emily Scott raising nearly $50,000 (more on Emily in a second) to fellow short track speed skater Kyle Carr raising $14,000 to bring his mother to the Games. Lindsey Van, part of the new retinue of women’s ski jumpers, raised $20,000; Sugar Todd, a long track speed skater, raised almost $6,000 to bring her parents to the Games; while teen brothers Danny and Drew Duffy raised more than $50,000 on RallyMe.com to cover their expenses. (To learn more about Emily Scott’s story in general and this kind of funding for Olympians in particular, see USA Today.)
To me, this is why the idea is so intriguing. A bunch of smart, driven people—world-class athletes in this case—started exploring how new technology and a new idea—fundraising via the Internet—could solve an old problem (making sure athletes could come up with enough funds to compete).
What a great inspiration to get all of us to really start exploring how technology can change lives—and industries—overnight.
Speaking of changing lives—except for a small handful of “A-list” athletes like Shaun White, Apolo Ohno or Bode Miller—most Olympic athletes toil in anonymity for more than a decade in order to make an Olympics, and they scrape by through a combination of parental support, off-season jobs and small stipends from their sports federations.
This was John Coyle’s story—a reality that nearly drove him out of competition.
For well-to-do athletes or those in high profile sports (snowboarding, figure skating, skiing) where ample funding is available through endorsement deals, a single-minded focus on training and preparation is all that is required. This is also the case for many athletes from nations that fully fund their athletes—think Russia or South Korea.
For the rest, there is a constant ever-present worry of “how will I pay for this?”—be it new equipment, travel, lodging or even food. At its extreme, it reaches the levels that Emily Scott—newly minted Olympian in short track speed skating—has faced. With a mother and a sister behind bars and raised by a single father with a blue-collar income, Emily, at one point, was forced to apply for food stamps to feed herself.
One might think that making the Olympic team would finally put these fears to rest, but, in reality, success breeds a whole new brand of financial worry.
Although the athlete’s travel, food and lodging are covered, parents and others who have played significant support roles are faced with massive expenses.
Olympic qualifying trials are often held close to the date of the Games themselves to ensure the very best team is selected, which leaves parents and supporters of the Olympian with having only weeks to find flights and lodging in cities that have been booked solid for months, and with flights subject to the supply and demand algorithms of Sabre (the airline yield management software), and with hotel pricing often reaching $1,000 per day or more at the Olympic site.
Maverick Olympian Emily Scott used a crowdfunding model the way many schools, insurers and organizations may employ in the future.
After applying for food stamps, she decided to create a GoFundMe page and at the same time had the luck of a USA Today article to lend visibility to her plight. In particular, other than feeding herself, she was most anxious that her father, Craig, would join her in Sochi. Twenty-four hours later, she had $30,000 in donations—most of them small. And by late January, she had $49,000 from more than 650 donors—more than enough to ensure that her father could join her at the Games.
Craig Scott, Emily’s father, IS coming to the Olympics, thanks in large part to crowdfunding. But here’s his flight plan that was designed to be as inexpensive as possible: He will board a plane in Kansas City and go to Chicago. From Chicago he will go to Washington. From Washington he flies to Turkey. From Turkey he flies to Germany, and from there finally on to Sochi.
Through crowdfunding, hundreds of thousands of dollars have been raised to ensure that those who compete and those who sacrificed for their success have the support required to share in the experience. This is particularly important given the relatively new tradition of the “Order of the Ikkos” award, where each medaling Olympian gives a medal to the one person who supported them the most. Hard to give a medal to someone thousands of miles away because they couldn’t afford to come.
So as you see, when it comes to innovating, Olympians must become the mavericks you’d expect them to be. They are going to find ways to get things done, whether it has been done before or not. Sounds like most of the entrepreneurs I know.
It’s Broader Than You Might Believe
If you think this is a movement that applies only to heroics, you’re mistaken. Desiree Vargas Wrigley launched a platform to help individuals crowdsource funding for medical emergencies. Giveforward.com has raised tens of millions in a for-profit model that is working. To paraphrase Desiree, “try doing that with a bake sale.” If I were an insurance company executive or a college admissions officer or even a young venture capitalist, I’d be taking notice.
Stop for a second and consider where else this innovation could have an immediate impact. For example, how long will it be before your social capital is more important than how much money you have in the bank, or even your class rank when it comes to getting your tuition paid by the school, your relatives or your future employer? Smart companies are looking really hard at this trend.
John Coyle has reason to be particularly envious of this emergent source of funding. After graduating college, John trained full time for eight years and made one Olympic team where he earned a silver medal. Along the way, he used credit cards to fund his dream. As a recent college graduate, he was able to apply for and received more than 50 credit cards, which he used to pick up and rotate $87,000 in debt by the time he retired from the sport he loved. His parents also spent years paying off their visit to Lillehammer, Norway.
Article originally published Feb. 12, 2014, on Forbes.com