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Lessons from the failure of social product development-platform CrowdSpirit

13 May 2011

crowspirit-logo-failed

When I read the German book Marke Eigenbau (Do-It-Yourself brand) about a year ago, I claimed that it was a fascinating and eye-opening book about the revolution of consumption going on currently. Mass-customization, co-creation, crafting and 3D-printing are symptomatic movements towards tailored consumption and/or production initiated by the the consumer. Seth Godin said it in 2005 already:  Small is the new Big. Someone who recognized and wanted to build on this revolution is Lionel David, founder and former CEO of CrowdSpirit, an innovation community based on the idea of crowdsourcing the whole product development process, from ideation to marketing (and even distribution). The platform is not online anymore, and here’s why…

PHASE 1 : Presentation & launch of Crowdspirit

As Bloomberg described back in 2007, CrowdSpirit “plans to use crowds to develop and bring to market tangible, inexpensive, electronic devices such as CD players, joysticks for video games, and Web cams“. By involving their private community, the people from CrowdSpirit hoped that the products would fit consumer need better and cost less than the traditional electronic products on the market. CrowdSpirit was based on community co-conception.

screenshot-digital-wall-calendar

This screencast by Travis Choma describes CrowdSpirit very neatly. Click on the image to view video (source: viddler.com)

The concept has been featured on the TechCrunch40-conference in 2007 as one of the most promising startups. Praise even came from Austria. Blogger Hannes Treichl called the project The most innovative crowdsourcing-project in the world“, mainly because the start-up completelly bypassed marketing departments and because it deals with real products. The French platform indeed specialized on electronic products, which it intended to develop entirelly by its community. As shown in the above video, one of the most promising projects was a Digital Wall Calender which allowed people to display and manage several calendars on the same digital, wall-monted flat-screen device.

The co-conception system adopted by CrowdSpirit was based on five consectutive steps:

  1. idea submission (individually)
  2. choice of promising ideas (wisdom of the crowd)
  3. definition of specifications (client)
  4. development (community project team)
  5. final validation (client).

We can see how the whole process move back and forth between collaborative and individual tasks. This hybrid organizational form implies new kind of challenges that Lionel David might not had expected. Because of lacking community involvement, he indeed had to evolve his business-model.

PHASE 2: Refining the business-model and the website

As our Austrian admirer of CrowdSpirit noticed, the firm “was not profitable, learned from it and adapted its business-model“. What’s interesting is that CrowdSpirit did not reject the idea of crowdsourcing, it just recognized that the community’s core competency was not co-conception but ideation and selection of concepts.

text

Abstract from M. David's interview (source: AndersDenken.at)

A research paper from two French academics also analyzed CrowdSpirit’s journey over more than a year. The researchers highlight how community-based value creation strategies are difficult to implement: it requires deep knowledge of people’s motivations to develop an appropriate incentive model, the managers of such platforms must identify their community’s core competencies and last but not least, it’s an ongoing learning process. In 2010’s follow-up of the TechCrunch40 companies, CrowdSpirit still appears as ‘in business‘… but today the platform has vanished.

screenshot

(source: grasshopper.com)

What led to CrowdSpirit’s fall? Was the platform badly designed for co-creation? Francis Gouillart recently said that engagement platforms produced an abundance of ideas but no real co-creation processes… I then found an example of a well-fucntioning engagement platform: Tchibo Ideas. Did CrowdSpirit fail because their was no real brand equity behind the crowd? Tchibo is a renowned brand, CrowdSpirit popped up from nowhere! Should the platform have been launched globally instead of in France? Or was it just bad timing?

I recently talked about community brands like Wikipedia, Mozilla or Threadless. I think CrowdSpirit could really have been a similar success. What’s your opinion on this? Do you know of other crowdsourcing platforms that failed to engage an audience? I’d love to hear your thoughts, especially now that we see successful platforms like Quirky… what do they do better?

Thank you @Ronteau for the tip about CrowdSpirit

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9 Comments leave one →
  1. 1 June 2011 01:26

    I think CrowdSpirit – did not have spirit. Failed probably in creating social meaning for people to participate in. Nevertheless, it is an admirable venture. I wish they had succeeded.

    Sivam

  2. Loïc permalink
    8 August 2011 09:07

    Great article, Yannig – as most of the times! 🙂 To me, this example can clearly be linked to co-destruction, which we exchanged about a few months ago. Thanks for that, I am definetely going to rely on that in a future paper!
    How did it go with your master thesis? Have you finished and defended it?
    Best

    Loïc

    • 8 August 2011 15:14

      Hi Loïc,
      I’ve defended and validated my master thesis, and I’d love to publish something with the results… it will take some time though!
      Yannig

  3. 29 November 2013 09:22

    You are right Crowdspirit should have launched globally. I was involved as the CIO late 2006 early 2007 and contributed towards the development of the idea and also polishing the content and message as English is my first language but it is not the language of the CEO. However it rapidly became clear that the CEO wanted a France based team for a France based market. This fundamental mistake together with an over inflated CEO ego who thinks he can do it all without an experienced team around him and who dumps people rather than working with them was probably the main reason a glorious startup failed miserably. Sadly this is the second company I have seen go to the wall in a similar way. Another startup I was involved with in 2000 had another CEO who only saw things his way yet somehow managed to get funding. Some months after I left there were numerous management changes with one person commenting that the new board shouldn’t even have shared the same room never mind running the same company. Sadly some CEOs never make the effective transition from sole entrepreneur to leader of a startup and having a coherent team around them who work with the CEO as one unit rather than a collection of individuals.

    • Lionel permalink
      9 February 2014 01:25

      Craig, your statements “You are right Crowdspirit should have launched globally” is completely wrong. Just look at the screenshot on this Article and you will see that they are in English and not in French (my mother language) as the Website was only available in English. The company was designed since the beginning as a global company but it was not sufficient. Moreover stating “CEO who thinks he can do it all without an experienced team” is not really fair for the core team of CrowdSpirit. One of the them even created the PC division of HP. Last but not least, the company was created in may 2007 and you have never been CIO of this company.

    • Jeff permalink
      11 August 2014 12:10

      This remains one of the pioneer experience in the domain and the idea was really brillant! When the company decided to turn to a new model it was already too late. The “spirit” was gone. Being French or global is not the point. The platform was global at the beginning. Human aspect is certainly one of the key point toward success or failure. The platform model was too complex may be, I also think they should have taken the risk to launch the wall calendar first and go through the whole process once, this would have shown a success and allow for more involvement of the people. An experienced member in product design, community management etc. would have been valuable for sure. The core team was too restricted, I agree. Sad story for a so great idea. May be they arrived too early and have experienced too much buzz… and then lost the “spirit”.

Trackbacks

  1. Co-creation vs. Crowdsourcing « joycediscovers
  2. Innovation Excellence | Who Will Top Quirky? Some French Contenders!
  3. Who Will Top Quirky? Some French Contenders! | Business and Software Strategy for Globalisation

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