Steps to calculate Socious Impact Points

STEP1: Calculate Impact Points Money - NOT IMPLEMENTING THIS NOW

Diagram
Logic
1. Calculate total amount of donation for a user
  - On “donation_transaction” table, sum all amount of donation by a user and calculate “Donation Amount”
2. Calculate total amount of purchase for a user
  - On “money_transaction” table, sum all amount of purchase by a user and calculate “Purchase Amount”.
3. Calculate total amount of lending
  - On “lending_transaction” table, sum all amount of lending by a user and get “Lending Amount”.
4. Calculate total amount of interest paid
  - On “lending_transaction” table, sum all amount of interest paid by a user and get “Interest Paid Amount”.
5. Calculate total amount for investing for a user
  - On “investing_transaction” table, sum all amount of investing by a user and get “Investing Amount”
6. Calculate weighted sum of impacts of purchase, donation, and lending
  - “Donation Amount”, “Purchase Amount”, “Lending Amount” “Interest Paid Amount” and “Investing Amount” are weighted with the ratio of 1 : 0.1 : 0.1 : 1.0 : 1.0. In other words, donation is highly weighted * and get “Impact Dollars Money”
  - Round the value above.
For example,

Lender lends $100 -> 10 impact points

Borrower pays back $116 ($100 principal + $16 interest) -> 16 impact points

<aside> 💡 NOTE
- We put more weight on donation than purchase, lending and investing. Purchase is less weighted because a purchase provides a user some goods or service in return but donation does not. Likewise, Iending and investment are less weighted because they are expecting either interest payment or shares/tokens.
</aside>

STEP2: Calculate Impact Points Time

Diagram
Logic
1. Create “Job Multiplier Lookup” * [only once]
  - In reference to Upwork, manually search the minimum and maximum hourly wage for each job name (ex. developer, designer, marketer …etc). Calculate average hourly wage by taking the mean wage between the minimum and the maximum.
  https://docs.google.com/spreadsheets/d/1ll8tJtfp_7AmdEKBMTW8Tmd2mkFrm4WLrFDI7lq90RI/edit?usp=sharing (job_multiplier (short)_lookup)
2. Calculate total amount of hours per a user and a job name
  - On “time transaction” table, sum working time in minutes with the granularity of a user and a job name, and get “Minutes Worked”.
  - Multiply “Minutes Worked” by 60 and get “Hours Worked”.
3. Transform time to value in dollars
  - Get hourly wage (“Job Multiplier”) from “Job Multiplier Lookup” table and represent “Hours Worked” in dollars by multiplying hours with hourly wage for each job name.
  - For a user, sum all dollars across job names and get “Hours Value”.
4. Adjust “Hours Value” by seniority of the contributor
  - Searching “user_skill” table, confirm user’s seniority
  - Adjust “Hours Value” with the following rules:
    - Expert → 10% increase
    - Intermediate → no change
    - Entry → 10 % decrease
    - No experience → 30% decrease
    - Have relevant certification → 10 % increase → NOT IMPLEMENT THIS NOW
5. Calculate total amount of payment → NOT IMPLEMENT THIS NOW
  - On “payment transaction” table, sum payments per a user and get “Amount Paid”
6. Calculate a donation ratio → NOT IMPLEMENT THIS NOW
  - “Donation Ratio” is calculated by the following logic:
    - IF “Hours Values” = 0 THEN 0
    - ELSE IF Amount Paid is greater than Hours Value THEN 0
    - ELSE (1 - Amount Paid / Hours Value)
7. Adjust a donation ratio ****** → NOT IMPLEMENT THIS NOW
  - If the donation ratio is less than 0.1, modify it as 0.1. In the remaining case, leave it as it is.
8. Calculate a time impact in dollars → NOT IMPLEMENT THIS NOW
  - Multiply “Hours Value” by “Donation Ratio”
  - Round the value
9. Adjust a time impact for organizations’ review (feedback)
  - Follow this rule:
    - Satisfactory + 10%
    - Not Satisfactory - 10% → change it to 0
<aside> 💡 NOTE
- “Job Multiplier Lookup” Table was created in reference to Upwork at first. We plan to update the table with transactions in Socious App in the future.
** “Impact Score Ratio” is set as 0.1, meaning we count 10% of the amount worked for the hours that are paid the amount which is equal to the value of the hours. For instance, if the value is $30 per hour and they worked for 1 hour for $30, then they get 3 impact points.

*** Volunteer work: 10% premium on volunteer work, so if a user works as a volunteer for a job that is worth $30 per hour, then the user receives 33 impact points.

</aside>

STEP3: Calculate Socious Impact Score - NOT IMPLMENTING THIS NOW

Diagram
Logic
1. Transform money impact dollars to money impact score
  - Take the fourth root of “Impact Dollars Money” * and get “Money Impact Score”
2. Transform time impact dollars to time impact score
  - Take the fourth root of “Time Impact Score” * and get “Time Impact Score”
3. Sum money and time impact score
  - Sum “Money Impact Score” and “Time Impact Score”, and get “Total Impact Score”
4. Cap the total impact score
  - Cap “Total Impact Score” by the 99.9 percentile value of the simulated distribution **, that is 52.83.
5. Scale a value between 300 and 850 **
  - Scale by the following formula
    - Variables
      - v_min: the minimum value of “Total Impact Score”, that is 0
      - v_max: the maximum value of “Total Impact Score”, that is the value of capping.
      - r_original: the range between v_min and v_max
      - v_min_new: the minimum value of the target range, that is 300
      - v_max_new: the maximum value of the target range, that is 850
      - r_new: the range between v_min_new and v_max_new, that is 550
    - Formula
      - {(value - v_min) / r_original} × r_new +v_min_new = {value / r_original} × 550 + 300
<aside> 💡 NOTE
- By this transformation, we adjust the difficulty to acquire more socious scores along with current money/time impact dollars. In other words, for a lower impact dollars holders, it is relatively easy to increase impact scores. For a higher impact dollars holders, it is relatively difficult to increase impact scores.
** We conducted a brief simulation of how these logic work and get distributions of “Total Impact Score”. The simulation depends on some assumption and may not perfectly match the real distribution, but we think it is enough to decide the cap value.

*** Socious impact score takes the range between 300 and 850 as it looks like a credit score. Reference: Credit Score - Investopedia

</aside>

Additionally, in an innovative approach to monetizing and leveraging impact, organizations using the Socious platform have the opportunity to sell the impact they create through our partnership with OutcomesX. This unique platform specializes in the trading of quantified impact outcomes, offering a marketplace where the value of positive social and environmental changes can be transacted. The dollar value of the impact sold on OutcomesX is directly added to the organization's Impact Points within the Socious system. This mechanism not only incentivizes organizations to generate and measure impactful outcomes but also provides a tangible financial benefit to their efforts. It represents a groundbreaking step in linking impact creation with economic gain, thereby fostering a more sustainable and impact-driven business ecosystem. This synergy between Socious and OutcomesX empowers organizations to not only track and improve their impact but also to receive recognition and tangible rewards for their contributions to societal and environmental well-being.

Note:

The following Google Sheet was created to demonstrate the calculation of Socious Impact Score. However, the calculation logic written here does not match perfectly that on the sheet. It is because:
1. Some part of calculations on the sheet did not match the idea of Seira. So, they should be modified.
2. Some part of calculations on the sheet can be simplified.
- Google Sheet
New Simulation with the logic above
- Google Colab Notebook