advertisement
advertisement

What Happens When Crowdsourcing Stops Being Polite And Starts Getting Real

Great things have come from Quirky and its community of inventors. But their biggest project, Aros, strained everyone.

What Happens When Crowdsourcing Stops Being Polite And Starts Getting Real
[Illustration: FOREAL]

Garthen Leslie is an IT consultant and looks the part. He’s geeky, quiet, and middle-aged, sporting a long, untucked white polo, khakis, and wire-framed glasses. But today, very suddenly, he is also the face of a new ideal–a symbol of how invention itself is being reinvented.

advertisement

“It was August and really hot,” Leslie says, recalling how it all began, as he reaches for an hors d’oeuvre at a media-saturated party being thrown in his honor in Manhattan’s Chelsea neigh­borhood (Martha Stewart will amble through the door in about 15 minutes). The 63-year-old had been commuting from Washington, D.C., to suburban Maryland, dreading the hellishly stuffy home that awaited him–but he didn’t want to leave his AC on all day, for fear of an equally hellish energy bill. “I thought, There are all kinds of applications for smartphones,” he says. “Why couldn’t we marry one to these window air conditioners?” He dreamt up a device that did just that and submitted it to a New York startup called Quirky, which turns great ideas into best-selling products.

Nine months later, Leslie says, came Aros–a mi­n­im­alist window unit that can be turned on or off via an app, and that adjusts itself to the weather. City dwellers nationwide were made aware of it last summer through a mass-transit ad campaign. TV spots soon followed. Thousands of Aros units have been sold through Amazon, Home Depot, Walmart, and other retailers since March. Leslie, who has no idea how to build a home appliance, has already netted more than $160,000 just for having the idea, and that number is expected to hit $479,000 by year’s end. Quirky is throwing this party (at the rotating-retail store Story, itself a reinvention) to celebrate their modern partnership.

One cool guy: “As a person trying to go it alone, you’d be a million dollars in the hole by the time you got a product that worked,” says Aros inventor Garthen Leslie.Photo: Lee Towndrow

Leslie is a big deal for Quirky. Since its 2009 founding, Quirky has sourced, produced, and sold 139 different products, typically household doodads like a $30 flexible power strip or a $5 egg separator. Ideas come from its community of nearly 1 million hopeful inventors, which it constantly cultivates and compliments: “You are the future of retail,” it often tells them, if not with those exact words. Anyone can submit. Users vote and weigh in on each other’s proposals, contribute to regular meetings with Quirky staff, and share slivers of royalties that have totaled almost $5 million. Quirky’s products land on shelves in 35,000 retail locations in more than 30 countries around the globe.

This model–tapping into the collective imagination (and entrepreneurial inertia) of the masses–has earned a lot of hype. “It’s the democratization of innovation,” says Vivek Wadhwa, a fellow at Singularity University and director of research at the Center of ­Entrepreneurship and Research Commercialization at Duke. “Before, designing a new product was extremely expensive, and only big companies could afford to do it.”

Leslie–and Aros–represent Quirky’s next big step: moving from a small startup with limitless R&D to a sort of on-demand maker of products (no matter the complexity) for interested partners. Last year, it announced that the $146 billion king of invention, GE, would invest $30 million in the company and open up thousands of its patents to Quirky members. GE, meanwhile, would acquire the nimbleness and cool factor it struggles to achieve on its own. “I’m a big believer in retail as media,” says Beth Comstock, GE’s chief marketing officer, who now serves on Quirky’s board. “[The partnership] gets us in new places in unexpected ways.” After a few false starts with gizmos such as an $80 egg tray that connects to your phone to tell you how old your eggs are, the duo found a winner.

Aros carries Quirky and GE logos, and caught exactly the buzz both companies want. Here is a smart product with a made-for-advertising story: An IT exec who once worked for the Department of Energy connects with the right people, solves a problem, and makes a fortune. Leslie is quick to praise his benefactor and now collects a 6.5% royalty on Aros sales in perpetuity. “Without Quirky, that idea would still be in my shoebox,” he says, over the thumping bass at his party. “And someone else would be sitting here talking to you right now.”

advertisement

The problem is, someone else in fact would like to be sitting here at this party instead of Leslie–which illustrates the difficulty of crowdsourcing ideas on a large commercial scale. There is a member who says he proposed a similar invention on Quirky earlier, unbeknownst to Leslie. This detail is one of many about Aros that enraged the usually constructive Quirky community, a group that Quirky itself seemed to take for granted as it embarked on its big adventure with GE.

“That kills me,” says Ben Kaufman, Quirky’s baby-faced, 27-year-old founder and CEO, of the internal strife over Aros. He often refers to himself as “the world’s least-important CEO,” reinforcing how important his inventor community is. (In one Aros commercial, he is shown rubbing Leslie’s feet.) That quaintness helped Quirky when it was small. But the company is expected to double its revenue to $100 million this year, and the Aros experience exposes an uncertain future for its model of invention: Is there a point at which a helpful crowd gets in the way of success?


At around 7 p.m. on a recent Thursday, Kaufman, dressed in his signature black tee, is standing at the front of a room addressing a crowd of Quirky employees–and 200 or so viewers online, many of them members of the Quirky community. This happens weekly; it’s called a Live Evaluation (“Eval” for short), and is one of Quirky’s core methods of collaboration. Together, staff, the community, and special guests review promising ideas and vote the best along to the next step of production. Tonight’s panel includes Quirky president Doreen Lorenzo (formerly president of the design consultancy Frog) and–because, why not?–­former governor of New York Eliot Spitzer.

Paula, a Quirky employee, stands up to present the first product. It’s an awkward-looking backpack with a built-in canopy and poncho, made to protect hikers in unpredictable climates. The inventor, who goes by the name Fabian and who is not in attendance, had held on to the idea for 10 years before submitting it to Quirky. “Is there a parachute?” Kaufman asks, half-jokingly. Spitzer sees a market in it for schoolkids who don’t want to add an umbrella to their load of books, but, he says, “I’m worried that one of the big companies would just grab it.” (This is a constant threat: All proposals are open for the world to see on quirky.com.) The people in Quirky’s physical office vote first, but are split. Kaufman asks the folks online to click a thumbs-up or -down button. The tie is broken: bye-bye, backpack.

advertisement

The Eval is part business practice and part theater, a regular and public way for Quirky to drive home its everyone-has-a-voice philosophy. Kaufman is heavily invested in this. He presents Quirky as a personal quest, one influenced by his mom, the COO of a Queens, New York, plastics factory. “I’d be home every day and hearing my mom bitching and moaning about how hard it was to make XYZ, and the difficulty with the labor force,” he says. After graduating from high school, he founded Mophie, a creator of smartphone accessories, and sold it two years later to start Quirky. Crowdsourcing quickly produced an unexpected benefit: He married one of his employees, Nikki, who has since launched a startup that 3-D–prints custom earbuds.

Quirky, essentially, serves the role of Kaufman’s mom’s factory in Queens: It handles logistics. The community handles the rest. A product begins with a submission, which once cost $10 but is now free, and which can be a sketch and a few sentences or a patented, working prototype. (One presentation at Thursday’s Eval contains a video of a fully functional barbecue grill that shoots smoke up into the air instead of leaving it to billow up into the chef’s face. Kaufman sends it through, to great applause.) For about a week, the community votes on the idea, makes comments, suggests features, and researches competitive products. Meanwhile, several Quirky employees, called general managers, scout their respective product categories for 5 to 10 ideas to present at the weekly Eval.

Once an idea passes through, any existing patents are transferred to Quirky, and it’s posted on the site for others to help mold. Quirky sets aside a 10% royalty for the community at large. (The other 90% is Quirky’s.) The inventor gets 4% to 7% of that, while other members vie for the remainder by participating in contests to set price, names, colors, and taglines. When a project is ready for “virtual launch,” a prototype is manufactured, photographed, and posted on Quirky’s website.

But this isn’t what happened with Aros, a discrepancy that Quirky hasn’t been excited to talk about. In November of last year, the Quirky execs met with General Electric, which was looking for ways to reinvigorate its air-conditioner business. Leslie, and his idea, were hand-plucked from Quirky’s ever-growing archive of submissions, rather than going through the usual approval-and-review process. The Aros’s icy, translucent exterior and clever airflow, which blows from the sides of the machine rather than from the front, was designed almost completely by a small group of Quirky staffers with help from GE. The AC’s smartphone app was developed by Wink, the Manhattan-based startup recently spun out from Quirky to develop smart-home software. The community was left with very little to do, aside from fill out a few surveys. A user named Jose Barrios proposed the name “Aros,” earning him 0.3% of the royalty pie. A contest was posted to determine Aros’s price, but it was swiftly yanked. Quirky explained to members that the contest was a “glitch.” By that time, Aros was already available for presale on Amazon.

Quirky’s members, who have been trained to think of themselves as an integral part of the creation process, felt betrayed. “What are we able to count on at Quirky when just about everything happening has a different approach?” wondered the user Thrifty, in a forum on Quirky’s message board. Conspiracy theories festered, the most notable starting with a Tampa, Florida–based security guard whose username is Tony Columbo, and who claimed that he submitted an idea for a smart air conditioner before Leslie. Was Leslie’s idea picked because the man was more marketable?

Before long, Quirky message boards– usually a lovefest of constructive ­discussion between members and staff–had turned into a battleground. Quirky’s community director, Nathaniel Padgett, dismissed Columbo’s claim, writing that executives had decided that Columbo’s idea was less detailed than Leslie’s and would not have been as “compelling to GE.” In another debate about Aros, a Quirky staffer snapped to a community member: “As much as you want to argue,” he wrote, “you know nothing, so it’s pointless.”

advertisement

What Quirky clearly knows is that retail and development partners like GE are results-oriented. GE wanted Aros, a seasonal product, to be on shelves by spring, and that left little room for thousands of people to go back and forth over features in the normal Quirky process. “The question of how you maintain the psychological contract and culture of the [Quirky] community, while at the same time allowing the organization to continue to innovate, is a big issue,” says Bob Sutton, professor of management science and engineering at Stanford and cofounder of the university’s d.school. EBay and Facebook have both endured blowback from their communities after making changes. But at Quirky, it’s not just people’s online presence that’s at issue; it’s their personal work product. And they feel attached.


Aros Smart Window Air ConditionerPhoto: courtesy of GE

Kaufman is lugging a large paper bag, smiling like a kid with a new toy. Then he plops it down onto a conference room table. It is midsummer and retailers have bought almost all of Aros’s entire 50,000-unit run. (A second version is in the works that will no doubt address the unit’s noise. Online reviews have been harsh on this point.) Now, reaching down into the bag, Kaufman reveals what he claims will be Quirky’s next big product: Relay, a $250 device with a touch screen that can be installed in place of a light switch and act as the hub for any Wi-Fi– or Bluetooth-enabled devices in a home. It can connect to products from 15 different companies, including Honeywell and Philips.

As with Aros, corporate partner involvement is integral to Relay. What’s different, Kaufman stresses, is the way it leverages Quirky’s members, who he insists remain at the center of everything. Relay is his evidence that a binary mode of operation–collaboration with major businesses like GE and with individual inventors–can yield breakthrough opportunities for everyone. Although this new device, like Aros, was developed internally, the next device to connect to Relay could come from the community.

There is a shift here. Once upon a time, members believed they were the sole engine that makes Quirky run. In this new world, they are a resource–providing an idea here, a product name there–but not always playing “a role in every single decision we make,” as Quirky’s home page promises.

advertisement

“They have to be consistent,” says member Bradley Sippl, a Los Angeles–based car salesman, of Quirky’s leadership. Yet Sippl himself had benefited from other shifts in Quirky’s model. After early incidents in which one product was made while someone else’s similar, previously submitted idea went overlooked, Quirky created the Influence Council. It’s a group of staff and members tasked with sorting out repetitive proposals. This ultimately saved Sippl’s invention. A trash can with a unique lid passed through Eval, but the Influence Council discovered that Sippl had proposed the same kind of item first. His SwingCan, as it’s called, was recently voted into Quirky’s online port­folio of products. “I got lucky,” Sippl says. “Columbo? Not so lucky.”

Kaufman is responding to the Aros con­troversy on several fronts. “This is a big piece of machinery,” he says of Quirky. “Some parts need to be oiled up, some parts need to be swapped out, completely rebuilt, and that’s my job.” This fall, he’s drastically revamping the idea-submission platform. Inventors will now be able to submit as a group. Staff will no longer handpick the ideas that go to Eval; instead, they’ll be based solely on community votes. And invention ideas will now also require a detailed sketch (rather than merely a “doodle,” as the website currently advertises), along with research to prove it’s differentiated enough from existing products.

Taken together, Kaufman’s strategy seems designed for maximum cohesion: Even as he builds complex partnerships with the likes of GE, Kaufman is doubling down on community involvement. And he has reason to believe it’ll work. Members’ anger over Aros, at the very least, shows their investment. They want to be a part of something like Quirky. “The hardest part about the business we run is getting people to trust us with their ideas. It’s their identity, it’s who they are,” he says. And it’s Quirky’s identity as well. It’s why a company like GE was interested in the first place, even if, this time, it didn’t need all those other voices.

Design Is Changing How We Work

About the author

J.J. McCorvey is a staff writer for Fast Company, where he covers business and technology.

More

Video