Instead, Diamandis’s extraterrestrial experience has been largely vicarious. As an undergraduate at MIT, he established Students for Exploration and Development of Space. In 1987, just four years out of college and still in medical school, he helped organize the International Space University, now located in Strasbourg, France. And he partnered with Lichtenberg to start Zero Gravity Corp. (Zero G), which simulates weightless space travel in a Boeing 727 (G-Force One) flying parabolas.
There’s a new model, Diamandis says. “It’s putting out a clear set of rules and a large cash challenge. We don’t care where you’re from, where you’ve gone to school, whatever you’ve done before—you solve this problem, you win.”
Yet it was the book The Spirit of St. Louis that really inspired the X Prize. To make his nearly 34-hour flight to Paris, Charles Lindbergh battled the elements, exhaustion, and the primitive technology of the day, all recounted in gripping detail by Lindbergh himself, right up to his landing at Le Bourget. Diamandis’s reading of the story was informed by his disgust with NASA, which reached a peak after 1992, the International Space Year. “We were supposed to commit to going back to the moon and Mars,” he recalls. “And then nothing ever happened.”
In the book Diamandis discovered that a competition to collect $25,000 put up by the New York hotelier Raymond Orteig was what motivated Lindbergh’s pathbreaking journey. “He negotiated a contract on one sheet of paper and built the Spirit of St. Louis in 60 days,” Diamandis says. More important, Diamandis saw that nine teams together spent $400,000 to win that $25,000. “I gave up on the government,” he says of NASA. “I didn’t want to fix it; I just wanted to do it on my own. And a competition was a way for me to create leverage beyond my means.”
Diamandis’s frustration with NASA has crystallized into a worldview. Paralysis “is endemic in the government,” he says. “If the government does something risky and fails, there’s a congressional investigation.” Likewise, “if a large corporation does something risky that fails, its stock plummets. I think we’ve become way too risk averse in this country. But the problem is, the real research, the real breakthroughs, require taking significant risk.”
Diamandis launched his first contest in 1996 to a great deal of enthusiasm in the space community but without a sponsor to supply the purse. “We jumped out of the airplane and had to build a parachute on the way down,” he says. “We ran X Prize on about half a million dollars a year for the first few years.” Diamandis estimates that he approached some 200 CEOs before the Ansari family, wealthy space enthusiasts, in 2004 offered their name to the competition and $10 million to fund the prize.
Money is less of a problem today. Among the winners of the Ansari X Prize was the X Prize Foundation itself, which, as handmaiden to Burt Rutan’s accomplishment, has been accorded prestige that in turn has granted it access to the most rarefied levels of the entrepreneurial economy. The Google Lunar X Prize, for instance, was conceived by NASA as a Centennial Challenge to mark 100 years of flight since the Wright brothers; the space agency later decided it was too expensive. “I said forget it, I’ll fund it elsewhere,” says Diamandis, who took the idea to Page in 2007. (Diamandis has a complicated relationship with NASA. For all his criticism, he is not opposed to working with the agency. The X Prize Foundation currently administers the Northrop Grumman Lunar Lander Challenge, a Centennial Challenge for which NASA has put up $2 million. Last October the rocketeer Armadillo Aerospace won the first part of that competition.)
Page has joined the X Prize Foundation’s board of trustees, as have Elon Musk (a founder of PayPal and Space Exploration Technologies), Dean Kamen (inventor of the Segway scooter), and Ratan Tata, chairman of an Indian conglomerate that bears his name. But if tech gurus and visionaries have indulged Diamandis’s appetite for taming various final frontiers, some—Page in particular—have also encouraged him to broaden his thinking of what the X Prize can do and apply the model to more pressing social problems.
In that vein, the next suggested X Prize that Diamandis and Panlasigui reviewed proposed having households across the country compete for $50 million to see which ones could lower their energy consumption the most—a “giant Darwinian experiment,” as Diamandis put it that morning. “Hopefully hundreds or thousands of teams will compete, resulting in millions of homes’ improving their energy efficiency.” Later, he explains, “I was challenging myself on how to create an energy X Prize that would be not about a new widget but about changing the way people think.”
This entrepreneurial sensibility defines the X Prize. If bureaucracy is the problem, then the solution, Diamandis believes, lies with the “unconstrained thinking” of individuals. “The day before something is truly a breakthrough,” he likes to say, “it’s a crazy idea.” Lately he has taken his case directly to the entrepreneurs. The Automotive X Prize calls for production-ready cars, while the Archon X Prize for Genomics requires teams to keep their gene sequencing costs under $10,000 per person—low enough, perhaps, to start a mass industry. (The current cost for sequencing an individual’s genome hovers around $300,000.)
The genome prize was conceived by geneticist J. Craig Venter, a kindred spirit who left the National Institutes of Health (NIH), frustrated by its bureaucracy, and then set up a company to challenge it in a race to decode the genome. This time Venter turned to Diamandis (Page had introduced them) not because of a failure at the NIH but because financiers weren’t supporting companies that did whole-genome sequencing. Individual genetic profiles, decoded cheaply, could help doctors predict patients’ susceptibility to disease and guide proactive care. Low-cost sequencing could radically transform the practice of medicine. But most existing funding was going toward sequencing the handful of genes most likely to lead to profitable drugs and gene therapies. In the absence of a lucrative market, the X Prize’s contest will give companies doing whole-genome sequencing a boost.
“People seek recognition and appreciation, and if there is a prize that’s commonly understood to be important, they’ll go for it,” Musk says. “I mean, why is the America’s Cup so great?” The prize confers legitimacy on the goal; at the very least, it makes raising money in pursuit of the goal easier. This is precisely what has happened in genomics. “There are a lot of new technologies coming up that nobody even thought of or talked about four years ago,” Venter says. “I’m sure the X Prize has helped contribute to it.”
Many who follow developments in research—who study studies, as it were—discount the aspect of inducement prizes that Diamandis prizes most: The payout does not occur until a contestant actually succeeds. From the perspective of the benefactor, be it a government agency or a billionaire’s foundation, a back-end payoff is extremely efficient, but skeptics call that myopic. Pull back, they say, and it is apparent that somebody is paying for all that investment. “As a public policy matter, you’re not doing the nation a favor if you reduce the government’s share, if the total expenditure is coming out of the U.S. economy,” says Lewis Branscomb, an adjunct professor at the University of California at San Diego.