At Techonomy we’ve heard tons of buzz about social product development company Quirky since our Techonomy Detroit conference, where company founder Ben Kaufman gave a high-spirited, enthusiastically received talk just weeks after finalizing a $68 million round of VC funding. But some wonder about the likelihood that other companies could easily copy the Quirky model. Quirky combines an in-house staff of engineers and developers with sophisticated management of an online community of global contributors of ideas and suggestions, who themselves make money from products they work on.
The more such companies the better, presumably, since social product companies might help more people generate incomes and lead to more desirable and environmentally-friendly products. And it all sort of aligns—just as Quirky is showing that the resources of the modern technologized landscape allow shockingly rapid product development cycles, so can companies themselves be created in short order. But replicating the Quirky model may be considerably more difficult than knocking off some new companies like, for example, Groupon.
Quirky’s advanced Web infrastructure is more than just a platform for idea submission. According to the company’s head of technology Nathan Smith, getting user payments and influence measurement right and integrating EDI (electronic data interchange) with customers took highly sophisticated development work. With this system in place, he says, “users will keep coming to us with their best ideas because they know that we will actually get them to retailers, and that they will be fairly compensated when their products sell.”
The machinery and personnel required to rapidly get products to market represent another formidable layer of structural development. Quirky has invested a lot of money in its technology, from laser cutters, to vacuum forming machines, to state-of-the-art 3D printers capable of printing in multiple materials in hours (necessitating an extensive library of materials). One Objet Connex printer alone cost almost half a million dollars, says Quirky’s head of engineering John Jacobsen.
In addition, Quirky employs eight designers and four engineers, although most of Quirky’s engineers have dual degrees in engineering and design, according to company executives. And it isn’t that easy to find people who can adapt to the company’s unique, fast-paced methodology, says Jocobsen.
“Our process is chaotic and cyclical at the same time,” he says. “The old methods of working on one thing and then handing it over would never fly at Quirky…. We work at this crazy pace that most engineers aren’t trained to work at. We don’t look for traditional engineers. We typically seek out more entrepreneurial ones who have studied product development.”
Still, manufacturing expert Terry Wohlers says Quirky copycats are “inevitable.” But because the Quirky model is so novel, it won’t be easy. “Nothing will stop younger people from duplicating the model, but it takes a lot of financial support and determination to pull it off,” he says. “I’m sure Mr. Kaufman and his colleagues were asking themselves what they’d gotten into when they started.”
While Kaufman and his team seem to be succeeding, anyone wanting to emulate or expand on Quirky’s social approach (“don’t call it crowdsourcing!“, insists Kaufman), will need time and substantial backing to build momentum. Perhaps large manufacturers like Procter & Gamble will leverage their existing resources to adapt to the faster-paced, socially networked model devised by Quirky. Or, as Wohlers suggests, there could be many new Quirky-like firms in the future. “It’s kind of like 3D printing: look at all the companies that are getting into that space. Stuff begins to snowball when there’s success and when there’s something of value that works. I see the Quirky business model the same way. People will copy it.”
Case in point, a new 3D printing company announced its release this week after a successful Kickstarter campaign. If the barriers to entry in 3D printing can break down with the help of crowdsourcing, perhaps the Quirky model is next. Techonomy will continue to explore how social networking is transforming product development—what PARC CEO Stephen Hoover has dubbed “Manufacturing 2.0”—keeping our eyes on Quirky, and any emerging competitors.