Welcome to the new and improved DaVinci Quest Web-site to support the Innovation Contest goals and objectives of DaVinici Quest, its supporting organizations, staff members, advisors, advocates, volunteers, and the many community collaborators and activists who want to create new solutions to solve many of today's problems...   And now they have a new set of tools and collaborative communications solutions to support their efforts.    

Welcome to DQ 2.0 !

As you can see the new DQ Web-Site has been completely updated and enhanced with a wide variety of communications, group, and contest management tools and utilities.  Stay tuned to this blog in the coming weeks for more information on the various features of the site and how you can directly participate in the process.

Mike Schmidt

DQ Staff

There is a direct relationship between the health of the small business community and the level of innovation. There is also a direct relationship between the health of the small business community and the number of new jobs created.  Small businesses create between 60% and 80% of all new jobs in any given year. I have seen lots of explanations for this relationship, but have found most of them to be overly complex.  The fact of the matter is that a small business is willing to embrace change because it stands to benefit more from a new market than in preservation of an existing market.  Large businesses resist change since change shortens the product/service life cycle.  Longer cycles allow large businesses to earn greater profits after major capital costs have been recovered.  In theory, less change means lower prices for products and services.  The consumer is able to afford a higher quality of life.  All is good.  In practice, change is always necessary.  Products and services designed for 50, 25, 10, 5 and even 1 year ago may no longer meet the needs of consumers. 

In addition, many needs remain in today’s markets which have not yet been addressed by the products and services of yesterday. Innovation is needed, but it won’t be found in large companies.  During a recession, it is even less likely to occur as budgets are cut and employees become risk adverse to avoid being laid off. Thank goodness for small businesses who embrace change.  However, change will not occur without capital.  An opinion by Henry Dubroff and John Huggins in today’s Sunday Edition of the Denver Post discusses the lack of capital and financing for small businesses: “The Redlining of Our Small Businesses”.  The article describes the decline of small business formation and job growth since 2003.as cheap money was diverted into the real estate market through public policy.  In 2009, the capital shortfall was amplified as small business lending fell by 27%, venture capital funds tapped out and angel investors ran to the sidelines.

Without capital, there will be no new small businesses and many existing businesses will fail.  Without small businesses, there will be no new jobs and the impact of the current recession will be extended.  The article points out that all of the recovery and economic stimulation money has gone to large businesses.  There seems to be no awareness or sensitivity by an ever growing government with employees that never missed a paycheck in the worst recession of all time.  Any interest in hiring by small businesses is stifled by the uncertainty regarding large government programs that have been the center of political debate instead of the more appropriate topic of job creation. The State of Colorado is considering raising taxes on businesses - removing any reamining capital and any incentive to hire anyone.  No new small businesses.  No new jobs.  No innovation.  Be happy with the status quo, because that’s all we are likely to have for a long while without a change in public policy.

 

 There are a lot of really tough problems out there. In recent years, there has been more discussion about why these problems continue to exist and whether these problems can be solved. In my readings and my own analysis, I have concluded that really tough problems can be solved with the right combination of money and innovation. You can’t solve a problem by continuing to do the same thing over and over again.  In fact, it has become popular to define insanity as doing things the same and expecting different outcomes.

And, you can’t tackle the really big problems with small applications of money. Steven Goldberg does a razor sharp analysis of why charitable giving does not make really tough problems go away in his book “Billions of Drops in Millions of Buckets”. 

As the title suggests, no matter how much money may be raised, its impact is diluted if it is spread out over too many projects. The Bill and Melinda Gates Foundation published their annual letter this week.  [A full copy can be obtained at: http://www.gatesfoundation.org/annual-letter/2010/Pages/bill-gates-annual-letter.aspx] The letter states that: “Melinda and I see our foundation’s key role as investing in innovations that would not otherwise be funded. This draws not only on our backgrounds in technology but also on the foundation’s size and ability to take a long-term view and take large risks on new approaches. Warren Buffett put it well in 2006 when he told us, “Don’t just go for safe projects. You can bat a thousand in this game if you want to by doing nothing important. Or you’ll bat something less than that if you take on the really tough problems.” We are backing innovations in education, food, and health as well as some related areas like savings for the poor. “ The Foundation focuses on selected problems and solicits innovation to solve these problems with large amounts of money.  A conscious decision has been made to work toward a better future rather than to distribute money to all of today’s needy. DaVinci Quest is attempting to take a similar approach with our innovation competitions.  Through the incentive of access to an international stage and the possibility of winning a major cash prize, we can attract the best and brightest minds from all over the world to provide major innovate solutions for the world’s really tough problems.

The U.S. Environmental Protection Agency put together a guide for renovation of a commercial building to make it more energy efficient: Energy Star Building Upgrade Manual.  The Manual is free and can be downloaded from their website at: http://www.energystar.gov/index.cfm?c=business.bus_upgrade_manual Like most government publications, this is not a paint by number kit that covers everything you need to know. 

t is an overview or summary of key issues that will be of most value to a person looking at this subject for the first time. I was particularly pleased with Chapter 3 on Investment Analysis.  This part of the manual looks at how spending the money on a renovation may pay for itself in energy savings. “All types of organizations, for-profit and not-for-profit alike, should analyze prospective investments based on their expected cash flows. If a business is contemplating an investment to support a higher level of sales, it should weigh the cost of the investment and any related operating expenses against the additional cash benefits to the business from the projected incremental sales. Only if the expected cash inflow is more valuable than the expected outflow should the investment move forward.”

The Manual presents and compares Payback Period, Net Present Value and Internal Rate of Return as concepts in making a decision to spend scarce cash.  Although this Manual is for commercial buildings, this chapter also applies to residential buildings. The rest of the Manual covers benchmarking, financing, different types of renovation and different types of commercial buildings.

The U.S. Environmental Protection Agency is hosting an energy saving competition for commercial buildings: The National Building Competition – Working off the Waste with Energy Star. Download more information at www.energystar.gov/BuildingContest.

Selected applicants will benchmark their building’s current energy usage with the EPA Portfolio Manager (an online software tool).  Energy usage will be measured from September 1, 2008 to August 31, 2010.  The building that achieves the greatest percentage reduction in energy during the 24 month period will be recognized as the winner. If your building is selected as one of the 12 participants in the contest, you will receive publicity, advice from a celebrity trainer, limited technical support and inclusion in the contest website. You may obtain the Contest Application Form at: http://www.energystar.gov/ia/business/downloads/EPA_building_competition_application.doc

The application needs to be completed and submitted to BuildingContest@energystar.gov by February 12, 2010.

DaVinci Quest has established a new MeetUp group on Green Building Renovation.  The group will be homebased in Longmont, Colorado - the site of our Smarter, Safer, Greener House Contest. This group will have two areas of focus:

1. The Smarter, Safer, Greener House Contest - an innovation competition to renovate 50 homes in Longmont, Colorado to make them more environmentally friendly, more intelligent and safer to live in.  We will be awarding a $500,000 cash prize to the Team that comes closest to our paradigm shifting conservation and energy production criteria.  We will be sharing information on how everyone can participate by becoming a DaVinci Quest Member, forming a Team or acting as a Team Sponsor.   For more information, go to: http://www.davinciquest.com/index.php/innovation-contests/greener-house   

2. Advancing innovation in the renovation of existing buildings to make them green and cut down on the 40% of energy consumed within the United States by existing buildings.  We are beginning to build an international community that will work to create a Green Building Renovation industry in Longmont, Colorado where we will support new businesses hat have new products and services which creates new jobs that will make our goal a reality.

Please join us. I hope to see you on February 3rd at 6:30 pm at 505 Main Street, Longmont for our inaugural meeting.

To sign up, go to: http://www.meetup.com/Green-Building-Renovation/ or click on the button on the lower right side of this page.

I will be speaking at the Colorado Springs Entrepreneurs Group tonight on the subject of innovation competitions.

If you would like to attend, go to the MeetUp page: http://www.meetup.com/ColoSpgsBiz/.

As the CEO of DaVinci Quest, a producer of innovation competitions, I have more than the average knowledge about idea contests and how they work.  I also was a winner in the world’s largest and longest running idea contest – the Small Business Innovation Research program – where I successfully competed for a Phase I Award on Small Business Commercialization of Federal Innovations for the U.S. Department of Commerce.

An innovation competition may actually be a complete commercialization path – allowing you to go from your idea to the sale of your idea as a finished product or service.  However, in most cases, an idea contest is limited to a demonstration of capability.  It represents the creative stage of problem solution/new product development.  You still are left with all the issues of designing, testing, manufacturing and selling your final product or service.

So, why should you enter an innovation competition?  There are many answers to this question.  You may:

• Receive fame (think American Idol)
• Obtain money (a cash prize or offer to purchase your innovation)
• Gain credibility (prove your idea works)
• Demonstrate superiority (show your idea is better than others)
• Build your network (meet other contestants, contest host, prize sponsors, media, the public, etc.)
• Generate customers (find people interested in your idea – either now as an opportunity or later as a product or service)

With all of these advantages, it would seem like you should hunt down and enter any creative competition that comes along.  However, there are a number of questions you should ask in your due diligence:

1. Are you allowed to participate?  Many contests limit who can compete.  The contest may be limited to college students, new businesses, specific geographic areas or members of an organization.  Any limitation on participation raises the question of whether the contest host is trying to solve a problem or promote some other agenda.
2. What happens to your intellectual property?  Many contests require that you give up your idea to the contest sponsor or sell your idea.  This is okay if the price is right and not if it isn’t. Make sure you have well documented your idea and have filed any necessary applications/registrations to preserve ownership before displaying it in a contest.
3. What is the prize?  Prizes come in all sizes, shapes and colors.  The prize may include money, publicity, a trip, a plaque or certificate, a handshake or some other form of acknowledgement.  The value of some prizes is easier to measure than others.
4. How big is the stage?  Since one of the primary benefits of participating in a contest is public recognition, it is important to know how this may occur and how much you will receive.  In some contests, no one knows you unless you win the grand prize.  In others, all contestants are visible throughout the contest and winning is a bonus.
5. Will you receive support? It is typical for a contest to send you the rules, wish you good luck (actually that seldom happens), and wait to see what you do.  In other contests you may be provided with special tools, mentorship, data/knowledge access or other support to improve your participation in the contest and your probability of actually solving a problem.
6. What will it cost? The best contests do not call for you to do anything you weren’t going to do anyway – create an idea and try to solve a problem.  Some contests require that you deviate from your original path – requiring additional time and money that you might have spent elsewhere.  In such cases, you have to treat entry into a contest as an investment – determine what benefits you will receive/may receive in exchange for your participation.  Some contests may prove too expensive to enter.

Three contests or sources of contests you may want to consider are:          

U.S. Government Small Business Innovation Research

                        http://www.sbir.gov            

X Prize Foundation        

                        http://www.xprize.org

Innocentive

                       http://www.innocentive.com

For the best list of all innovation competitions, go to Innovation Prize Central:

                        http://innovationprizecentral.com

For the definitive analysis on innovation competitions and why they should be part of your strategic portfolio, download a copy of “And the winner is…” from McKinsey & Company (easiest found at the MIT website):

                        http://www.mit.edu/globalchallenge/?p=48

So, please consider entering an innovation competition, including our Smarter, Safer, Greener House Contest at http://www.davinciquest.com/House_Contest.php. Good luck and good contesting!

Zerofootprint Software, a for profit provider of carbon footprint measurements, and the Zerofootprint Foundation, a climate change nonprofit, have combined to offer the ZEROprize™ to the design team who can take an older concrete high-rise structure and, using re-skinning (a term they coined to describe a holistic approach) along with other retrofitting technologies, reduce its carbon, water and energy footprint to net zero while also maintaining the highest architectural design standards. Their goal is to inspire designers and developers everywhere to create exceptionally beautiful, energy-efficient buildings.

For more information about the contest, go to: http://www.thezeroprize.net/images/ZEROprize.pdf

The entry deadline is February 22, 2010. To qualify, the building must be of reinforced concrete construction and have been built between 1945 and 1990.  It must have a minimum of 150,000 square feet of floor space.

The entry must include the following materials along:

1. A 1,000 word description of the overall project including location, building age, construction type, date the project was completed, etc.
2. A 500 word description of who the client is and their objectives for the project.
3. A 500 word description of the design and engineering teams and their prior work.
4. A detailed breakdown of the building’s environmental footprint prior to the re- skinning and retrofitting process.
5. LEED Certifications / Triple Bottom Line analysis if applicable.
6. Engineering analysis specifying desired environmental footprint performance for the post-retrofitted building, and also detailing what systems will be used to achieve those targets.
7. Return on Investment analysis detailing the project payback schedule (Note that the retrofitting costs have to be amortizable over a period of not greater than 20 years and be paid for by the energy and water savings realized by the retrofit).
8. A description of how the critical technologies used in the project are replicable on a global scale.
9. A description of how the building uses “smart” technologies to help achieve its environmental footprint goals.

Entries should be submitted to: robert.ouellette@zerofootprint.net

To win the prize, the candidate building will be required to have a net zero footprint for one year.

In gathering information about current best practices in renovating buildings to make them green, I came across a number of articles about new home building by Habitat for Humanity.  Since these are ‘affordable’ homes where every effort is made to control costs, I thought there may be some lessons to be learned.

For those of you who may not know of Habitat for Humanity, it is a charitable organization that builds low cost homes and provides financing for low income individuals.  It is a charity that I support.  I respect their approach, which is a sustainable business model.  Every home is built and sold with the revenues going to build and sell more homes.

More information about this great organization can be found at their website: http://www.habitat.org/

Different chapters of Habitat for Humanity are working on development of a green building model. The Portland East Metro recently received the 2010 Energy Value Housing Award (EVHA), the nation’s preeminent energy efficiency award honoring builders who voluntarily incorporate energy efficiency into all aspects of new home construction.  See http://habitatportlandmetro.org/habitat-for-humanity-leed-homes-in-portland-to-receive-national-award/.  Completed in April 2009,  these homes were the first LEED-certified Habitat homes in Oregon, and were the result of a unique opportunity and collaboration between the Cascadia Region Building Council, Walsh Construction Co., Bank of America and Habitat for Humanity. 

Some features of these homes include:

● FSC Certified framing lumber from local sources.

● Standing seam metal roofing from Taylor roofing.

● Faswall, a wood-chip Insulated Concrete Form (ICF) locally produced with recycled wood fiber is used in the low walls of both homes.

● American Clay interior plaster produced from local clay by local craftsmen.

● Yolo Colorhouse provided locally produced, organically based paint product.

● SIPs panels and standing seam metal roof manufactured in Oregon.

● Marvin Integrity Fiberglass windows and patio doors.

● Owens-Corning Blown-in fiberglass insulation and rigid foam insulation.

● Fly-ash in concrete.

● Concrete from demolition re-used for landscape pavers.

● Decks constructed from reclaimed discarded wood.

● Paperstone countertops in one unit, Urea-Formaldehyde free laminate counters in the other.

● Urea-formaldehyde free composite woods and cabinets.

● Marmoleum floors in kitchen, bath, and utility areas.

● 100% wool carpets with 100% jute backing in sleeping areas. 

This demonstration project was an opportunity to utilize many non-traditional products and systems that Habitat wished to learn about. A large amount of the materials and labor for this project were donated, which allowed the homes to be affordable for low-income families. The families will purchase the homes at cost and pay a 0% interest mortgage. While building green can be more expensive, the long-term benefits of lower-energy cost help make these additional up front costs worthwhile. 

Not all of these items may be used in a low cost renovation, but still good knowledge to have.

As we have begun signing Contest Agreements with Homeowners in the Smarter, Safer, Greener House Contest, the biggest issue rasised by Homeowners is that of financing the cost of the renovations.

Setting aside for the moment all of the environmental and economic stimulus issues, let’s examine why a homeowner may choose to renovate their home and where they would ordinarily get the money.

Homeowners commonly renovate their homes to improve the aesthetics, the utility and the economic impact.  Aesthetics is the look and feel of a house, its curb appeal, the sense of security and other emotional characteristics.  Utility refers to the functions of a house such as living, storage, entertainment, security and comfort.  The economic impact includes the reduction in operating costs and increase in building value.  The decision to renovate is based upon a decision that the cost of renovation will result in an improved value to the homeowner that justifies the cost.  This decision is largely financial.

In simple terms, the cost of renovation may serve to reduce the energy bill while increasing the property value.

As previously discussed in prior blog posts, alternative energy adds another factor to this equation.  Production of energy may not only reduce the energy bill, but also create a revenue stream.

Again in simple terms, if a homeowner finances the renovation, they expect to make installment payments over a period of time.  The installment payments include the total cost of the renovation and the interest charges for the ability to make payments over time.

If the reduction in monthly energy bill is greater than the size of the installment payments, then the homeowner should invest in renovation. 

If the installment payment is greater than the reduction in the monthly energy bill, the homeowner may still choose to renovate based upon the improvement in aesthetics, utility and increase in property value.

In different geographic locations, including Longmont, Colorado, there are government programs that may serve to reduce the amount of the installment payment.  This may take the forming of subsidized financing or tax credits.   It may also open up financing not available through commercial markets.