The first few hackathons were organised in the US in the late 1990s; the event format later flourished in the 2000s along with the rise of the nerd culture that made billionaires of a number of techies. Given that hackathons have since gone mainstream and become regular corporate events on the calendars of big names across the tech, retail, aviation and healthcare sectors, agencies dedicated to organising hackathons are capitalising on the hype.
Bangalore-based HackerEarth is one such agency that has helped the likes of General Electrics and Société Générale organise hackathons. Born out of a community of developers in 2012, HackerEarth began life by hosting various coding challenges on machine learning, data science and programming before branching out to organise hackathons for corporate clients.
“Coding challenges only allow us to evaluate how good our developers can be, but we want to leverage the model of crowdsourcing to solve business problems. That’s where the concept of hackathons comes in,” says Sachin Gupta, co-founder and CEO of HackerEarth. He explains that the company now has about two million developers on its platform, 75% of whom are based in India and Southeast Asia.
According to data from hackathon-listing site Hackathon.com, 4,480 hackathons were held worldwide in 2017, an increase from 3,450 events in 2016. External hackathons account for 63.7% of all the events listed by the platform last year, while the rest were internal hackathons open to employees of the organising company.
The former have, to a certain extent, retained the nerdy elements of its origins with participants pulling all-nighters fuelled by caffeine and takeaway pizzas. The US, UK and Germany were the top three countries with the highest number of hackathons or “hack days” held, while Australia was the top market from Asia-Pacific with 280 hackathons organised last year.
Sandra Lee, account manager overseeing the Asia-Pacific businesses for BeMyApp Agency, however, believes that hackathons have yet to reach a mature stage in this region. It does not help that the translation of “hacker” in Chinese (黑客) gives a negative connotation to the activity in the mainland market.
“Companies in Asia are on their way to seeing the value of hackathons, by being able to get external partnerships and ideas with an open innovation strategy. They are on their way, [but] not systematically yet, as Asian companies usually like to build partnerships between themselves,” says Lee.
The external partnerships that Lee refers to largely come from the developer and tech communities who participate in external hackathons. Since crowdsourcing is central to the idea of a hackathon, getting the right audience to participate is often the clinch factor that determines the ROIs of the activity, says Lee. “When you look at the results, you don’t just look at the numbers, how many people are there on site… [but rather] were these 100 people fulfilling the objectives of the client and the hackathon?” she says.
While BeMyApp is mainly an event agency and not a developer community like HackerEarth, Lee says the modus operandi is similar with the organiser doing the ground work to build up the database of potential participants. “First of all, we have to make sure that all participants are interested in the topic, they are in this location and they would like to work on hackathons. We do one-to-one profile matching and invitations,” says Lee.
Even then, Gupta points out that the changing nature of hackathons that have evolved from a tech-based event to an operation-based challenge in certain cases calls for organisers to look beyond their pool of developers.
Yet Lee maintains that her agency never paid participants to attend the event and hackathons should not impose entry fees on participants. “It’s an investment of time and energy. If they are not really interested, they don’t have to come,” says Lee.
Right to ideas
Seasoned hackathon participant Agrim Singh who has taken part in almost 40 events since 2013—with 25 wins so far—agrees that monetary rewards and prizes are often not the motivation for participants.
“Usually a lot of hackathons are presented as a great exercise to brainstorm new solutions for industries. If we win, we win, maybe we can work with someone together, and if we don’t, that’s okay. It would be a good weekend for us to try and build stuff,” says Singh, who is based in Singapore.
What irks him is companies that use hackathons as a cheap brainstorming exercise and then claim the right of first refusal (RFR) to the winning ideas.
Singh lashed out at AirAsia in an article published on Medium for its RFR claims during the Airvolution Hackathon held last year—although he did not participate in the event.
“Hackathons are a good opportunity to get developers on board to care about your mission. At the same time, if you want to get people to build things and enjoy doing that, you make it business driven and try to generate new ideas to the extent that participants who might not have read the T&C get locked out of pursuing this idea elsewhere because you have first refusal. This feels kind of disingenuous,” says Singh.
Having said that, Singh believes that few hackathon attendees really care about intellectual property (IP) rights or plagiarism of ideas since their main motivation is to build things and solve
real business challenges.
“Ideas are cheap, it is usually the execution that matters,” says Singh. “As a matter of principal, for an organisation, you need to be very clear that if you want to keep the IP, [you have to] make the winning team part of the process to build stuff with you.”
Failing to inform participants, or not following up with winning ideas, defeats the purpose of organising a hackathon as the company may not know what the creator envisions the idea to be and its methodology.
Singh has experienced this first-hand after winning a hackathon organised by Budweiser in 2016. Despite promises by Budweiser to bring him and his team on board to develop their idea of a vending machine that recommends drinks based on consumers’ personalities, they were eventually left in the cold following management changes within the company.
“S$25,000 [the prize money] is not a small amount of money to give to anyone. The fact that they gave out so much money and did not follow up, it was time and opportunity wasted for us,” says Singh. “You spend time organising the hackathon for months, and the participants work on it for a night or two, and then you don’t care. So the KPI is met and nothing comes out of it, it’s kind of useless.”
Issues such as RFR and adoption of ideas aside, the golden rule of hackathons remains that all participants own the rights to their ideas. BeMyApp’s Lee emphasises that no hackathon would take place if the clients did not agree to this term.
HackerEarth’s Gupta, meanwhile, believes that it is fair game for companies to offer rewards in exchange of the winning ideas. “Technically the clients have the freedom to choose whichever IP model, but taking all the IP rights is not the best practice because nobody wants to give away IP. About 80% of companies follow our recommendation of the best practice,” he says. In terms of the viability of ideas, Gupta says about 50 to 60% of the winning solutions from hackathons executed by HackerEarth were adopted by the clients.
Besides that, some companies do organise hackathons as a recruitment drive, but Gupta has reservations about such practices. “Ultimately it doesn’t work out and we don’t advocate it either. The reason is simple: it is kind of unfair to expect someone to come in to spend 24 hours without coming up with a solution for a real business problem and in the end get rewarded with a job. A developer would rather spend much less time [and effort] going through the interview route,” says Gupta.
Hong Kong retail giant A.S. Watson Group which held its first internal hackathon in 2014 to develop a mobile app has however tapped into this approach to recruit big data talent. Mandy Ng, group project director for big data, claims it is the only retail group in the territory that has offered "gigabytes of data" to participants at its first public hackathon organised earlier this year. Five of the alumni from the competition have since joined the company's big data team . "Big data will play a major role in shaping the future of retail industry and we need a lot of skilled technology professionals to derive insights, to help us make critical and data-driveb business decsions," says Mandy Ng, group project director for big data.
Even though there are few exceptional IP rights disputes arising from hackathons in this region, there are other aspects that require a considerable amount of expectation management between the organisers and the participants.
Gupta refers to each hackathon as a “campaign” that requires various stages of execution, including defining the problem statement in a manner that can be easily understood by the target audience and developing a platform where participants from different backgrounds can come together and collaborate. Too often, companies have jumped on the hackathon bandwagon as a PR and marketing exercise without putting real thought into its challenge statements and what they expect from participants.
The same goes for the sponsors of the event. However, as technical sponsorships go, most of them such as Chinese voice recognition provider iFlytek that sponsored Ikea’s recent Ikode hackathon in Shanghai, expect participants to use their products as part of their solutions.
However, the core issues with hackathons remain: the technical divide between participants and the challenge, as well as the technical gap between the judges and the participants.
“I think in a lot of hackathons, technical solutions are pitched to audiences that are not technical, so you don’t see a lot of actual demos,” says Singh. “If you want to show technical solutions to a non-tech audience, you need to make it easy by teaching the participants how to implement low-technology solutions, or do a low-technology demo. Some level of hand-holding becomes important.”
An easy solution to address technical gaps for participants is pre-hackathon workshops. “They will be involved in an ideation process, know what the company is looking for and also familiarise themselves with the tech. Many developers know very well what technology they want to use, but there are internal application programming interfaces (API) that they haven’t had access to before participating in the hackathons,” says says BeMyApp’s Lee.
Perhaps more importantly, pre-hackathon workshops allow participants who have little knowledge about the brands or organiser beforehand to empathise with their problems and understand their day-to-day work cycle, Singh says.
“As an organiser, you do your bit to provide participants a chance to succeed,” he says. “Twenty hours can go by very quick, we need mentors on site at some point, someone to run ideas by, you might realise that some ideas are not strong enough to pursue.”
Internal hackathons on the rise
Judging by data from Hackathon.com, internal hackathons are on the rise, accounting for 36.3% of hackathons organised in 2017 from just a quarter in 2016. For brands that think there are fewer issues to be ironed out with internal hackathons, they are in for a different set of challenges.
Most companies still engage agencies to carry out internal hackathons because HR departments often lack the expertise to organise such events, says Sandra Lee, account manager at BeMyApp. “We usually don’t do pre-hackathon communications like what we do for public events because internal hackathons have different objectives. Usually it’s to train the mindset, to get all the departments on board, to understand that hackathons are held to solve real challenges in their daily work.”
Her experience tells her that it is even more difficult to recruit participants for internal hackathons. Her team works with HR departments to develop communication strategies and plan the composition of teams.
Similarly to external hackathons, the issue of technical divide remains a challenge and some effort is required to educate employees on what a hackathon even is. “From mini webinars on tech, inviting the speakers to provide content such as ‘AI for Dummies’, means we help them to find the connection between their daily work and tech,” says Lee.