Pssssst. Hey, kid.
Think you’re smart enough to get an A in that UW-Madison economics course you’re signed up for in the fall semester?
Want to bet on it? How about $25?
It’s been said that people will wager on almost anything.
One enterprising company led by a trio of 20-somethings based on Long Island, N.Y., is putting a new, educational twist on this theory.
Ultrinsic, an Internet-based company, is offering students at 36 college campuses — including those who attend UW-Madison — the chance to bet on whether or not they’ll earn a certain grade in a given course.
The company is promoting itself as a virtual kick in the butt that can help motivate students who might require a little added incentive to get off the couch and into the library.
“Our goal at the end of the day is to help students study and perform better in the classroom,” says Judah Guber, the 26-year-old chief operating officer of Ultrinsic. Jeremy Gelbart, 23, the company’s president, co-founded the website with longtime friend Steven Wolf, 27, who serves as CEO. Guber says the company, which is privately owned and based in Cedarhurst, N.Y., currently employs more than 30 people.
“It’s hard to debate a service that says it’s trying to help students improve their grades,” says Guber.
But there are plenty across the country who are raising questions about Ultrinsic and its purported service.
“The concern I have is that academic success and grades are serious endeavors — an important part of college experience,” Kevin Kruger, associate director of the Student Affairs Administrators in Higher Education, told http://www.insidehighered.com/news/2010/08/11/betting">Inside Higher Ed. “Certainly, for many students, the pursuit of good grades is not always incidental to the pursuit of knowledge.”
Turning learning into a betting game, adds Kruger, “seems a little antithetical to the spirit of the academic mission.”
At this point, not many administrators, professors or students at UW-Madison appear to know about Ultrinsic.
Aaron Brower, UW-Madison’s vice provost for teaching and learning, e-mailed to say he knew nothing about the company. But after glancing at a few newspaper articles about the website, he noted that the company “trivializes what college should be about — learning — for the sake of grades.”
The company started offering its service last year to students at New York University and the University of Pennsylvania, drawing around 600 students. Its expansion this year also includes Big Ten Conference institutions Indiana University-Bloomington, Michigan State University, the University of Michigan-Ann Arbor and Penn State University.
“When we started out last year, we did very limited outreach,” says Guber. “We had theories about how this would work but wanted to test it in a very controlled and limited fashion. So we did that well, but we didn’t advertise or market or do anything like that. This year, we’ll do a little more of that and hope to grow.”
Guber says the website works like this: Students open an online account, upload their class schedule for the upcoming semester and then give the company access to their official school transcript so Ultrinsic can review past classes taken and grades received (Incoming freshmen are generally assumed to all be at the same level). Using a student’s history and any information Ultrinsic has about particular courses on campus — What is the subject? What department is offering the class? How difficult is it to get an A? — the company then calculates odds and offers them to students.
A student who typically gets mostly B’s might be able to more than double his money if he’s willing to bet he can earn an A. The payout would be less for those with a higher grade-point, or for those who only want to wager that they’ll earn a B. Most bets are capped between $25 and $50 per course.
If a student makes the grade — ca-ching! — Ultrinsic pays him according to the predetermined odds. If not, the company keeps the bet.
But if you cash in, don’t refer to your winnings as gambling profits. Internet gambling, after all, is technically illegal.
Guber insists Ultrinsic isn’t a gambling site, and says the numerous lawyers the company has conferred with agree.
“This isn’t gambling because there is no luck involved,” he says. “This really relies on a student saying, ‘I’m not reaching my full potential. I have control over what the results are, I’m just not doing it. I believe in myself enough to give myself a little bit of a push and an incentive, and I’m going to get a reward if I can do this.”
I. Nelson Rose, a gambling law expert and professor at Whittier Law School in California, told the Associated Press that the legal definitions of gambling usually list three elements — chance, some sort of fee or wager, and a prize. Carnival games at a county fair, for example, offer prizes for a fee, but skill is often required to win. A range of contests, meanwhile, offer prizes, with winners chosen at random — but these games always say “no purchase necessary.”
“This doesn’t depend on some card coming out or some team winning a game or something else that’s completely out of your control,” says Guber. “This is just something that’ll help give you the willpower to get off the couch and study. This is a game of skill where you control the results. Gambling is something that’s completely out of your control.”
At the end of the day, however, Ultrinsic needs to have more money coming in than it’s paying out on these wagers if it is to survive.
So whether it’s technically gambling or not, the odds are stacked against those placing the bets and favor the house — which in this case is Ultrinsic.
“People make a mistake if they think this is all about the money,” says Guber. “The idea is to give people an incentive to do better in school, to get to a certain point. So even if you lose a bet but do a little better in the class, it’s worth it.”