This is very similar to this notion of impact prizes. The main difference there seems to be that there is a specific allotted sum of money for a variety of possible possible projects, which share that allotted amount proportionally to their estimated impact.
I think that the downside of impact prizes compared to Conditional Impact Finance is mainly that it is much more volatile for investors—both because of dependencies between different projects and somewhat due to the continuum of possible values of estimated impact. Also, it is much harder on the donors. Well, there is also the problem that it may be clear that other competing projects are closing in on something much better (9x is enough to limit the prize to 10% of the original amount), and also competing interests between projects.
The major upside of impact prizes seems to be that the incentives of the project is better aligned with maximizing impact because they get a prize which scales sort of linearly with impact (unless they are enormously successful).
This is very similar to this notion of impact prizes. The main difference there seems to be that there is a specific allotted sum of money for a variety of possible possible projects, which share that allotted amount proportionally to their estimated impact.
I think that the downside of impact prizes compared to Conditional Impact Finance is mainly that it is much more volatile for investors—both because of dependencies between different projects and somewhat due to the continuum of possible values of estimated impact. Also, it is much harder on the donors. Well, there is also the problem that it may be clear that other competing projects are closing in on something much better (9x is enough to limit the prize to 10% of the original amount), and also competing interests between projects.
The major upside of impact prizes seems to be that the incentives of the project is better aligned with maximizing impact because they get a prize which scales sort of linearly with impact (unless they are enormously successful).