If you’re so sure you’ll ace that class, why not bet on it?
That’s the principle behind Ultrinsic.com, a recently formed website that allows students to put their money where their mouths are when it comes to academic achievement.
Wagers on class grades between friends or rewards from parents may be fairly common, but Ultrinsic is formalizing the process and upping the stakes by allowing students to predict their grades for individual classes over a period of a semester or throughout their entire college career. The website then provides “incentives” for hitting a target grade, either in a single course, multiple courses, a complete semester or an entire college career. For example, a student who bets $20 as a freshman that he’ll graduate with a 4.0 average will receive $2,000 at the end of senior year.
Previously operating via pilot programs at New York U. and U. Pennsylvania (UPenn), the website now offers its services at 36 colleges, including Harvard and Boston U., as of last August. According to CEO Steven Wolf, the idea was sprung from a simple bet he made with a friend while both were undergraduate students at UPenn.
“My partner Jeremy [Gelbert] and I were hanging out one Sunday,” Wolf told the Daily. “He had a test to take and he really didn’t want to study, so I was like, ‘Listen, would you study for $100? How about if you study and do well, you get $100, but if you don’t study and you don’t do well, you give me $20.’ He agreed to do it. So he did that, got an A and ended up getting money from me.”
Ultrinsic operates under the same notion, Wolf said.
“Basically if a student says that he is going to get an A, and if he’s a B student, he has to put in his GPA so we know how much he’s pushing himself in order to do better,” Wolf said. “If he says he will put in $20, we’ll give him $60 if he gets the A. If at the end of this semester he confirms it, he gets his winnings.”
According to Wolf, each member starts the process by uploading his or her class schedule and giving the company access to previous transcripts. After doing so, Ultrinsic will gauge the performance of the student based on previous grades and upcoming courses, as well as research the difficulty of the courses based on school statistics and from websites like RateMyProfessors.com. Finally, the student will be able to wager a first−time bet maximum of $25 for the grade he or she will receive.
While it may sound complex, Wolf insists that the process is relatively simple, which he says is proven by the site’s current popularity. An estimated 8,000 users have signed up to date, Wolf said, a number that he anticipates will increase as the site expands.
The current roster of schools for which Ultrinsic is available is dictated by several factors, according to Wolf.
“A lot of it is logistics,” Wolf said. “We look to see how it can do in certain kinds of places, [with] student body size, religious affiliations, sports teams, etc. We put all these factors together and come up with this list of schools.”
Wolf attributes the speed of expansion to the fact that he doesn’t liaise with school officials prior to giving a student body access to Ultrinsic.
“We’re not affiliated with the schools, [so] we don’t have to deal with them. We just follow whatever the market dictates,” Wolf said.
Tufts students currently cannot become Ultrinsic users, but Wolf believes that his creation could be hitting the Hill by as early as the fall.
“I think the next expansions will be in the hundreds, and maybe the whole country,” he said. “I definitely see it going international.”
Bypassing administrative approval for the website, however, could cross legal boundaries, according to Tufts Lecturer of Economics Peter Kronberg, who teaches a course on business law.
“[Administrators] are entrusted in caring for students in certain ways,” Kronberg said. “Universities can be seen as helping illegal activity by releasing private information, so they have every right to be cautious about releasing this information.”
Another source of controversy is whether or not Ultrinsic’s practices should be considered online gambling, which is illegal under federal law.
“Everyone asks about [the gambling issue],” Wolf said. “We’re not the first guys to take advantage of [the law] — it’s legal. Our thing is to say that your grades are a skill, and people pretty much agree to that.”
Kronberg does not think that the legality of gambling is the Ultrinsic’s primary issue; instead, he is more concerned with the website’s mode of acquiring funds.
“Insurance companies have actuaries to determine what the odds of anyone’s death or property loss might be,” Kronberg said. “If they price the insurance so that it brings in more than they have to pay out, the insurance company makes money. They also provide a service by spreading the cost of a loss [or a] death among many people.”
Kronberg added that Ultrinsic’s policy of gauging students’ past grades and determining the odds for individuals obtaining their anticipated grades is a major factor in this process.
“Once they have enough data, they can make successful bets, [and] they have a cushion to hedge against bad bets because they also receive the registration fee and can earn money on the student’s bets that are on deposit with them and that they hold, interest−free, until the end of the semester,” he said.
Issues aside, Kronberg feels that the service may not become as widely popular as Wolf anticipates.
“I think after a while — college students are smart —they’re going to see it and drop it,” Kronberg said. “What’s the real upside? If you get a 4.0 GPA in college — which is statistically very difficult to achieve — then big deal if you get $2000. You’re going to get more money in job offers. Tufts students are pretty darn smart, but I don’t think it’s going to be terrifically popular.”