Bringing Web3 ideas to life: Building Grants Programs that Drive Innovation and Change the World

\ What do the polio vaccine, the Human Genome Project and the Internet have in common? All three life-changing breakthroughs were kickstarted by grant programs.

\ The development of the polio vaccine was powered by the March of Dimes, a grant-backed initiative championed by President Franklin D. Roosevelt to combat childhood paralysis. The Human Genome Project, a monumental leap in understanding human biology, was launched with support from the U.S. National Institutes of Health and the Department of Energy. As for the Internet, its beginnings trace back to the U.S. Department of Defense’s Advanced Research Projects Agency (ARPA), now known as DARPA, which laid the foundation for our interconnected world.

\ These famous examples prove that grant programs can be powerful tools to drive progress, spark innovation, and nurture exceptional talent. When designed thoughtfully and with intent, they not only provide much-needed funding but also create a transparent and accessible entry point for individuals, teams, and organizations eager to make a difference. However, achieving the right balance between accessibility, accountability, and outcomes is crucial to a program’s success. It's very tough to get right. 

Bold Ideas Meets Failure: When Grant-Funded Projects Fall Flat

\ Even with the smartest people making decisions in the room, there are plenty of examples where bold ideas paired with generous funding have failed to take off.  Remember Hyperloop One? The ambitious project, which aimed to create a futuristic high-speed transportation system using vacuum tubes (yes, it does sound bonkers), received millions in private grants and government support from countries worldwide, including feasibility studies funded by cities. Today, the entire initiative has stalled. Many governments and backers have withdrawn, citing infeasibility and a lack of tangible progress, leaving the project’s future in limbo.

\ Solyndra is another case in point. The American company received a $535 million loan from the U.S. Department of Energy in 2009  to develop cylindrical solar panels that were intended to be more efficient and cost-effective than traditional designs. Two years later, it declared bankruptcy, having overestimated market demand and underestimated competition from cheaper Chinese solar panels.

Let’s also throw South Korea’s Singing Road into the mix. Developed with government grants, it featured a stretch of road that played a melody when cars drove over grooves at the correct speed, to help encourage safer driving.  The project hit a sour note. Drivers found the tunes annoying, residents complained about the noise, and high maintenance costs made the project unsustainable. The road to success came to a halt. 

Backing the Best of Web3’s Potential  

The world of Web3 is also no stranger to grant-funded failures. Notable losers include Substratum, a decentralized, censorship-resistant Internet platform; Parity Signer, a Polkadot wallet that was too complex and difficult for users to navigate; and the Akasha Foundation, a decentralized social media platform leveraging Ethereum and IPFS. 

Yet, unlike the era before it, Web3 has yet to deliver life-changing solutions that achieve mass adoption and profoundly impact the lives of billions. 

\ The path towards this ambitious goal is being paved with grant funding across the ecosystem. Every major Layer 1 blockchain has established its own programs to empower developers, creators, and communities to build impactful projects, driving innovation and adoption across the industry. 

\ But what are the key ingredients to designing an effective grant program that truly fosters groundbreaking innovation? What does it take to create the conditions to launch Web3 innovations that rival the transformative impact of the Internet, the mobile phone, or the polio vaccine? 

\ Here’s a summary of best practices and insights to drive success within our ecosystem:

Providing an Explicit Call to Action and Entry Point

As a starting point, a well-designed grant program should serve as a clear and transparent "way in" for the ecosystem. It should offer an explicit call to action, inviting innovators and changemakers to participate and signaling that their ideas and contributions are valued. Programs that are easy to understand and straightforward in their application process significantly lower the barriers to entry for new teams. It also helps to democratize opportunities and ensures a broader range of participants.  Clearly defined application guidelines and timelines empower first-time applicants to engage with confidence, fostering diversity and inclusivity within the program.

Striking the Right Balance in Application Requirements

Another key element of a successful grant programme is designing an application process that strikes the right balance between simplicity and rigor If the process is too complex, it can discourage promising applicants, leaving you with only “paper pushers” adept at navigating bureaucracy. On the other hand, if the process is too easy, it risks attracting uncommitted participants who lack the initiative required for success.

Applicants should demonstrate a willingness to invest effort upfront. A thoughtful application process that requires some degree of detail ensures that only serious and capable participants apply. For example, asking for a clear project outline, a budget, and evidence of prior work allows applicants to showcase their potential while demonstrating their commitment to the program’s goals.

Encouraging Ownership and Accountability

A common pitfall in grant programs is funding projects that result in minimal follow-through or only partial delivery. This often occurs when programs inadvertently attract applicants motivated primarily by funding rather than impact. Effective grant programs should be designed to identify outliers—individuals or teams that stand out for their creativity, dedication, and ability to deliver results. Those truly standout innovators you can bet on to make a real impact.

To attract the right candidates for funding, programs should encourage grantees to take ownership of their projects and foster accountability. For instance, structuring funding in phases tied to measurable milestones can ensure that participants remain motivated and focused. This approach also enables grantors to identify high-performing grantees early, allowing for targeted support and further investment in their success.

Offering Constructive Feedback and Timely Responses

One of the most appreciated aspects of a grant program is how it engages with applicants during and after the application process. Providing feedback, whether on rejected applications or during the review phase, adds immense value to participants. It helps applicants refine their proposals, enhances their skills, and demonstrates that their efforts are respected.

Equally important is maintaining reasonable response times and adhering to service-level agreements (SLAs). Applicants value clear communication and timely updates, which reflect the program’s professionalism and commitment. For example, establishing specific timelines for application reviews, feedback, and fund disbursement can significantly enhance the applicant experience and reputation of the program.

Fostering a Culture of Excellence, Not Compliance

Grant programs should aim to identify and support exceptional individuals and teams, not merely those who can tick boxes in an application form. While accountability and compliance are important, the ultimate goal is to empower visionaries who can deliver transformational impact.

A strong program focuses on applicants who clearly stand out for their originality, passion, and capability. By emphasising quality over quantity, grantors can avoid creating an "army of contractors"that you have to babysit and constantly follow up with just to see if they deliver. Instead, the program becomes a launchpad for groundbreaking projects led by motivated and capable participants. 

Building a Vibrant and Dynamic Ecosystem

Beyond funding individual projects, grant programs have the potential to energize entire ecosystems and create the right vibes for growth. By bringing in new teams and perspectives, they encourage collaboration, innovation, and cross-pollination of ideas. Programs that actively promote networking and knowledge sharing among grantees create opportunities for exponential growth.

For instance, hosting regular workshops, webinars, or meet-ups for grantees can foster connections and inspire collective problem-solving. These interactions help build a community of innovators that drives progress well beyond the life of individual grants.

Measuring Success and Iterating

So how do you know if you’ve created a successful grant program? Metrics like the quality and diversity of applicants, the success rate of funded projects in achieving their goals, and the program’s long-term impact on the ecosystem are key indicators of success. An effective grant program is also treated like a living system that evolves with feedback and outcomes, ensuring its relevance and effectiveness over time. Regularly evaluating performance and incorporating lessons learned can ensure continuous improvement. Equally important is flexibility—a good grant program adapts its processes and priorities to meet changing needs and seize emerging opportunities. The Web3 world is dynamic -programs that remain static risk losing their impact..

Conclusion

What will be the killer applications for Web3? What ideas from our unique sector will come to life and change our world for the better?  Only time—and money—will tell. 

\ By striking the right balance between accessibility and rigor, fostering accountability, and providing constructive feedback, grant programs can empower participants to excel while creating value for the broader ecosystem. With thoughtful design and execution, they can also drive transformative progress -  one project at a time.

Avoiding common pitfalls and focusing on identifying the standout stars ensures that the program delivers meaningful and lasting impact for generations to come.

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:::info Think you’ve got what it takes to build on Starknet? If your goals align with ours, apply to our grants program. We’ve crafted a process that not only celebrates talent but also provides the support you need to thrive at every step.

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Reach out—we’d love to hear from you!

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:::tip Written by James Strudwick, Executive Director, Starknet Foundation

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