What is a business plan competition?
It’s not always easy to decide whether a particular business competition or contest belongs on our database on Bizplancompetitions.com.
Those that meet the following criteria are always added:
- They are run by a school, nonprofit organization, or government agency.
- The winners are decided by independent judges.
- They award a meaningful cash prize (generally over $5,000 in total).
- They are held annually.
- At least for now, they are held in the U.S. [Sept 2010 update: we are now expanding to include Canadian competitions as well as global competitions that permit U.S. entrants.]
Yet many worthwhile competitions don’t satisfy all of these requirements. For example, TechCrunch is a for-profit media company that stages business plan competitions at its semi-annual conferences. We include those competitions because they are well-run, offer a meaningful prize, and attract big-name venture capitalists as judges.And then there are those competitions that use public voting in the finalist selection process. As long as independent judges make the final decisions, that’s okay. MobileBeat 2010 selects two finalists on the basis of public voting, but 18 finalists are selected by VentureBeat. Independent judges then choose a winner at the conference.
Intuit’s Love a Local Business is a tougher call. It’s more of a recognition event than a business plan competition. And finalists are determined by a random drawing with entries weighted by the results of online voting. Yet we have included it in our database because the grand prize winner is selected by “experts” and because Intuit is, you know, Intuit.
We draw the line on business contests that are purely vote-driven, and currently exclude them from our database. The University of Northern Iowa has just announced such a contest, called “Dream Big, Grow Here.” Each month, from June 2010 through December 2010, the entrant (must be based in Iowa) accumulating the most online votes for its new business idea wins $1,000.
Leaving the final results up to a public vote may work well for American Idol, but we don’t think such popularity contests work so well for profit-motivated startups. An entrepreneur or business begging for votes through Facebook or Twitter seems a bit pathetic, which is why the winners will likely be community- or charitable-driven ideas whose appeals are viewed in a more positive light.
And although it does not meet our requirements, Dream Big, Grow Here will no doubt be effective in publicizing the business resources available to entrepreneurs through UNI, and it may even offer business owners a new avenue for promoting their businesses by posting their ideas online.
Photo credit: Leo Reynolds
Joe Hurley is a CPA, author of "The Best Way to Save for College - A Complete Guide to 529 Plans", founder of Savingforcollege.com, and co-founder of Bizplancompetitions.com. He has also recently started making maple syrup.
