This a win for Highway they get to pick and choose whatever they want via the prototyping stage from layouts, mech's and toys. They also get to see if the full prototypes create enough interest via pinball shows and the internet to see if it would be viable for production and they don't even have to spend a single dime to do it.
It also ties up these talented people to the development to the Highway system and stopping them for going to another startup or established pinball company.
Honestly its a great move for Heighway, not sure about the people doing the work since it seems they will be paying for the right for a chance for Heighway to use their designs.
Also lets be honest every person and their dog has an idea for a pinball game, but there will only be a few that will take through to completion, using this model it will weed out those people who can't go all the way.