NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

In December 2012, Giving at Google provided GiveDirectly $2.4 million to scale and test its Kenya-focused money transfer charity model in other countries.

GiveDirectly is a jarringly simple online platform that lets anyone donate directly to poor households in Kenya, no strings attached. About 93 cents of every donated dollar (minus money transfer and recipient enrollment costs) goes directly to poor Kenyans to spend as they choose. According to the charity, those households are selected based on how they live, e.g. they may occupy homes made of mud or thatch, are typically living on 65 cents a day, and rarely have enough food to last until the next day. They receive funds through M-PESA mobile phone cash transfers.

Two years before the big boost from Google’s tech/philanthropy arm, GiveDirectly was largely still in the embryonic stage – a concept hatched by four economists from Harvard and MIT who were frustrated by the limits of charitable giving. In 2010, they received a $5,000 prize from the Extraordinary and Unorthodox Philanthropy challenge to get started.

The competition is back for 2013 with a $10,000 prize for the best idea that will have a “transformational impact on the lives of the most disadvantaged people.” The contest also offers the “possibility” of up to $100,000 in “implementation funding” to bring the winning idea to reality.

There are only a few other requirements for enterprises or charities that enter. They:

• Have not yet attracted significant funding elsewhere

• Are likely to attract additional capital after our initial “catalytic” funding

• Are novel, unorthodox and/or challenge conventional wisdom.

If you know someone who has a great and earth-shaking idea, there’s something in this contest for you – or at least for the charity of your choice. The contest is offering a $5,000 finder’s fee if the winning individual or team was referred to the challenge by a third party. That $5,000 will be donated charitable organization specified by finder.

I can tell you less about who is actually funding and managing this contest, as the backers are listed simply as a “family foundation.” That anonymous foundation, which previously partnered with InnoCentive on the contest in 2010 as Rob Katz noted back then, received nearly 200 submissions.

June 1 is the deadline to apply.