Quirky is dead. Long live Quirky!
As you may have heard, crowd-sourced product developer Quirky has filed for bankruptcy, claiming its business model had scalability challenges (code word for losing money). Quirky did achieve success by some measures, including $185 Million raised, over 400 products launched, over $100 Million in revenue, a connected-home spin-off (Wink) and several corporate partnerships with the likes of GE, Mattel and Harman. But Quirky was flying to close to the sun – it was stretched too thin, taking on a vertically integrated production model and way too many product lines, ranging from home appliances for humans to drinking fountains for dogs. Towards the end, when it did see the light and feel the heat, it was trying to fly back towards safer heights, outsourcing some IP, production and distribution to partners, concentrating on fewer products and its ability to aggregate a crowd of inventors and partners (powered by Quirky), but it was too little too late and the wax melted off the wings.
Quirky’s demise as a scalable business has incited critics to now question anything ‘crowd-based’, calling it the end of the democratic Innovation era. I respectfully disagree. Quirky failed because it was trying to be every business. Instead, every business should try to be Quirky!
Quirky was right on betting on crowd-sourcing for some aspects of product development – generating possibilities, solving technical and some marketing challenges, yet it failed to realize that crowd-sourcing doesn’t necessarily replace individual brilliance and small teams (that can best interact with the market to truly test ideas, make timely changes to the business model). Quirky’s visionary founder (Ben Kaufman), acknowledged as much, that the crowd had a role but wasn’t a silver bullet.
Large companies have a chance to learn from Quirky and adapt its strengths to their own Innovation efforts – adding the power of crowd-sourcing to Innovation to supplement the advantages of entrepreneurship (oh yea – they also have to adopt the entrepreneurship part, which they seem to have forgotten!).
I’ve dubbed this medley of crowd-sourcing and entrepreneurship as “Collective Entrepreneurship”… bringing both the power of the many (through an online platform) and the power of entrepreneurship (champions and small teams) together.
Large companies can launch Collective Entrepreneurship platforms to fuel internal employee-driven Innovation (idea contests meet internal accelerator) as well as outward facing co-creation platforms bringing together startups and consumers to create things in areas that benefit society and where the large corporation can actually support as a strategic commitment and a scalable business model.
Hopefully Ben Kaufman comes back as the king of product development crowdsourcing, now travelling from one large company kingdom to another, creating a headless Quirky that will live forever – power to the people!