Hackathons for Web3 Developer Communities

 Two weeks ago, we unpacked why great developers are critical to a Web3 project's success and introduced three major developer engagement strategies adopted by blockchain teams: grants, ecosystem funds, and hackathons.

After exploring the advantages and disadvantages of grant programs in our last post, today we spotlight hackathons as a developer engagement strategy, and if you're an emerging blockchain protocol, key considerations and thought exercises for deploying a successful hackathon.

With roughly 18,000 monthly active Web3 developers at the height of the bull market (vs. 30 million registered iOS developers), crypto developer activity pales compared to its Web2 counterparts. Gokustats suggests activity has tanked in the bear market, highlighting the ever-growing importance of attracting a solid developer community.

TLDR: Bull market, bear market. Doesn't matter. Hackathons fuel innovation, protocol adoption, use-case ideation, and recruitment.

Let's dive in.

1.    What are blockchain hackathons?

For those unfamiliar with the concept, hackathons are competitive events that pit teams of developers against each other to conceive and build a minimum viable product within a predefined scope and time constraints for a chance to win prizes.

In the blockchain space, developers are generally given resources by the Web3 project hosting the hackathon to build a decentralized application (dApp). At the end of the hackathon schedule, all the submitted projects will be judged by a panel of judges to award the best hackathon projects with cash prizes, grants, and exposure to prominent industry names. Judges can be sourced from within the Web3 project core team, the broader protocol ecosystem, or even third parties unaffiliated with the project.

While traditionally in-person, many hackathons today are online, enabling global participation, though as we'll discuss later in this blog, in-person components may bolster community growth effects. Hackathons provide an excellent opportunity for protocol teams to discover downstream grant program recipients or ecosystem fund investments. It is worth noting that not all hackathons are associated with a specific blockchain project and can be focused on a particular cause.

1.    Why blockchain projects cannot ignore hackathons

·    Hackathons can lead to outsized outcomes: Some of the most successful crypto projects today, including Polygon, Covalent, 1Inch, and InstaDapp, were started at hackathons. When a team of ambitious developers can ideate, execute, and perhaps even capture the attention of your community, that is often the only conviction required for them to commit to the project full-time.

·    The battle for talent: Crypto developers are scarce. Many tech companies, not just limited to Web3, are competing over talent. Hackathons can be a massive recruitment channel for new protocols. While predominantly oriented toward developers, hackathons can also attract non-technical talent to get involved in your community.

·    Quality market research: Hackathons can be treated as an extension of your research arm. The attraction of new developers that hackathons bring may also uncover pain points/challenges and present an opportunity for protocols to build robust resources/documentation to improve the onboarding experience. Not only can hackathons improve a protocol's existing features, but they can inform new feature development.

·    Use case discovery: Hackathons allow protocols to crowdsource targeted solutions to targeted problems that you may not have been aware of. Teams often see hackathon projects exploring use cases on top of a protocol that turns out to be a huge business. Hundreds of projects built during hackathons went on to raise VC money and advance the industry forward.

1.    Limitations of hackathons

·    Limited viability: One potential downside of hackathons is the limited long-term viability of projects that come out of them. Exploration and innovation are confined to what can be done concisely, creating a challenging environment for serious market research, modeling, due diligence, etc. In other words, teams can solve a problem somewhat in a vacuum without proper contextual knowledge.

·    Need for additional support: The projects that come out of hackathons will generally need significant iterative refining, support, and funding through grant programs and ecosystem funds to produce full-fledged products with product-market fit.

1.    Key hackathon development considerations

·    Optimize your program structure for your foundation's needs: Some protocols may require targeted support on several initiatives, whereas more established protocols may desire a more open-ended platform to crowdsource a broader development spectrum. Project teams should aim to optimize their hackathon program to the needs and life stage of the protocol. Sometimes, broadening the scope of challenges to encourage creativity and innovation is far more helpful than choosing a narrow focus.

·    Be transparent and unbiased as possible: Hackathons should reflect the decentralized nature of blockchain networks. As the protocol grows, ensuring transparency throughout the process and offering the opportunity for community input can empower developers by alleviating concerns around bias and lack of clarity in decision-making. As much as possible, try to involve your community, consider crowdsourcing judging, and hold hackathons in person.

·    Focus on the people: Offering office hours, in-person events, Github libraries, and networking opportunities (preferably in-person) help protocols capture value beyond the scope of the grant proposals. These value-add activities and resources help foster a vibrant, collaborative developer community that is key to decentralized protocol growth.

1.    Notable blockchain hackathons in 2022

The following are five examples of significant hackathons in 2022 organized by leading protocols. The majority of these hackathons incentivize long-term beyond the contest, feature robust panels of judges curated across the crypto space, a plethora of media partners for press coverage, educational workshops, and mentorship support, and live events designed for community building:

1.    Polygon Grants Hackathon ($100k in prizes)

2.    Polkadot Hackathon: North America Edition ($613k in prizes)

3.    Solana Summer Camp Hackathon ($5M in prizes & seed funding)

4.    NEAR MetaBUILD 2 Hackathon ($1M in prizes)

5.    ETH Hackathons (prize money varies)

Bull market or bear market hackathons are an effective way to onboard developers and encourage protocol adoption. They provide an excellent platform for creativity, use case development, and recruitment and can be a stepping stone to more mature initiatives such as grant programs and ecosystem funds. And remember, hackathons are just as much, if not more, about the people and community as they are about the projects that come out of it.

Stay tuned for deeper dives into developer engagement in Web3 with our next spotlight on ecosystem funds.