When people talk about crowdsourcing, wikipedia is almost always the first example given. The challenge, of course, is that wikipedia is a not-for-profit site, and individuals and companies face a very real issue trying to carry the lessons over to for-profit exercises. While we’ve highlighted companies ranging from Innocentive to Cambrian House in the past, I thought I’d draw your attention to another company moving into this space – Kluster.com.

Erick Schonfield wrote an excellent article about Kluster on TechCrunch about 10 days ago, and the key point is this: Ben Kaufman (the CEO) believes that what’s missing are market-like incentives to motivate contributors and push the best ideas forward. In turn, it appears they’re evolving a fairly interesting incentive distribution framework to encourage participation.

Kulster has created their own currency called “watts”. Companies and individuals can post projects (and their accompanying awards) on the site, similar to an innocentive contest. Kluster members can then “invest” their watts in whatever ideas they think are best, and they can also contribute to them in a variety of ways (design, etc.). When a contest is won, everyone who backed the winner gets a payout based on a variety of criteria – how much they contributed to it, how many watts they risked on it, and how early they got behind it.

It’s quite a cool idea – not only does it allow for the distribution of rewards, the watt system provides a market-based incentive system that should push the best / most marketable ideas to the top, so crowdsourcing is being leveraged in a few different ways at once. It’s also quite Darwinian – at the end of the contests, the Watts invested in the losers are redistributed among the winners, who then have more to invest in the future.

There’s also talk about royalties and other things that I think would be great (but apparently were met with resistance), but to get the rest of the details I strongly encourage you to read Schonfeld’s article yourself. Better yet, check out Kluster.com for yourself (but make sure you have a FireFox browser, because IE doesn’t seem to work so well right now).