A Foreclosure on Cambrian House? Is this the First of Many Crowdsourcing Casualties?
As the Brilliont team has described in our 10 Un-Commandments of Innovation, the overuse of the term “wisdom of crowds” is pretty nauseating. An offshoot of the wisdom of crowds hysteria are business models predicated on ‘crowdsourcing’, e.g., leveraging the talents or resources of many to achieve some particular objective. In the UK, crowdsourcing worked to fund the purchase of a football team for example.
Amongst the highflyers in this segment are Cambrian House, a Calgary startup that tries to organize the crowd around creating new ideas for Websites and software products. But alas, the Cambrian House appears to have been foreclosed on with a firesale of its assets just occuring to venture capital firm Spencer Trask per TechCrunch.
So is this just bad luck or poor execution on the part of Cambrian House or an indication of things to come for other crowdsourced models? Here’s my unsolicited $.02.
- Most crowdsourced businesses will fail. Not because crowdsourcing is incompatible with good business, but because a lot of people looking to “pile on” and who have no business starting a company will start crowdsourcing businesses and raise some dumb money while the concept is hot. Their businessplan/pitch will contain the words web2.0, wisdom of crowds, open source and will surely get investors into a lather. The failure, however, of these businesses has less to do with crowdsourcing as an idea than the management team and their half-baked ideas and ineptness as operators I suspect.
- Crowdsourcing will work better in things where the outcome is clearly defined. Want to buy a football team? I can see how that works. Want to build a software or something electronic? Visualizing this and understanding how my own contributions fit into the whole is a bit more nebulous. Clarity of what is being crowdsourced will be important to the initial successes.
Time, of course, will tell us if crowdsourcing is here to stay and to what extent. I do think there is some merit in the crowdsourcing idea, but it’ll take a while to separate the few winners from the many many losers. Bye Cambrian House.
Tags: , cambrian house, crowdsourcing, spencer trask, techcrunch
