Prize competitions and accelerators
Cash prizes from federal agencies and others for solving a set problem, and accelerator or incubator programs that give coaching, contacts and sometimes money. Prizes take no ownership; many accelerators do, so read the terms.
- No security
How it works
Federal prize competitions. Federal agencies can run competitions that award cash or other prizes for solving a problem that advances their mission (15 U.S.C. 3719). Each one publishes its rules, how entries are judged and the prize. To win a cash prize, a company must be incorporated in the US and keep its main place of business here; individuals must be US citizens or permanent residents. Some competitions ask entrants to carry liability insurance. Challenge.gov, the old listing site, closed on March 30, 2026; USA.gov now lists active federal challenges and links to the agencies that run them.
Accelerators and incubators, as the SEC describes them:
- Accelerators support early-stage businesses that already have a business plan and a product, usually for three to six months, with training, mentoring, advice and introductions, sometimes including to investors. They "commonly invest in equity" in the companies they work with.
- Incubators work with businesses still developing their model or product, over a longer period, with training, office and administrative support and mentoring. Some provide funding or take equity.
Programs that take no equity are the ones that belong on this rung. If a program offers money for shares, it is an equity investment: see angel investment and SAFEs.
Before you apply: check who runs the program, what it costs (some charge fees), whether it takes equity or asks for rights in your intellectual property, and what you must report.
Upsides and downsides
Upsides
- Prizes are money you do not repay, and take no ownership
- Accelerators bring mentors, contacts and sometimes introductions to investors
- Accelerators can open doors to potential funding sources
Downsides
- Competitive, with uncertain results
- Many accelerators take equity in return for their money and support
- Prize problems are set by the agency, not by your business plan
Risks
- Giving up equity or intellectual property rights you did not mean to, in some programs
- Spending months on a competition you do not win
What it costs
- How it is priced
- Free when the program takes no equity; your time, and sometimes travel or a fee
- Costs that are easy to miss
- Time spent on applications and program sessions
- Equity, fees or rights to your intellectual property, in some programs; read the terms
Set by each competition or program. Federal prizes over $1 million need the approval of the head of the agency.
Does it fit?
Could fit when
- You are developing a new product, process or technology
- Your business is at an early stage and wants coaching and contacts as well as money
Unlikely to fit when
- You need the money within weeks
- The business is well established, past the stage most accelerators serve
Who can use it
- Business types: Sole proprietorship, Partnership, LLC, S corporation, C corporation, Benefit corporation, Cooperative, Nonprofit
- Open to businesses with no sales yet
- Federal cash prizes: a business incorporated in the US with its main place of business here, or an individual who is a US citizen or permanent resident
- A product, idea or solution that matches the competition's problem or the program's focus
Am I ready?
What a provider is likely to ask for. Tick what you have. Your ticks stay in this browser and nothing is stored. Checklist for all grants, tax credits and prizes
0%
0 of 2 ticked
- Short pitch
- Program terms read
Regulation and protections
Regulators: No regulator for the finance itself.
Who runs it: Private providers, nationwide.
Federal prize competitions follow 15 U.S.C. 3719 and each competition's published rules. Accelerators are private programs with their own terms; if one invests in your business, the securities laws apply to that investment.
Types of provider: Federal agencies running prize competitions; Accelerator and incubator programs.
Also consider
What has changed
No changes since this page was published. It was last checked against its sources on October 20, 2026.
Sources
- 15 U.S.C. 3719: prize competitions · checked October 20, 2026
- Challenge.gov: challenge and prize competition content has moved (the platform closed on March 30, 2026) · checked October 20, 2026
- USA.gov: Challenges and prize competitions · checked October 20, 2026
- SEC: Small business glossary (accelerator, incubator) · checked October 20, 2026
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