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Is Quirky the way for your Invention?

Do you have an idea, but no money to patent it or even produce it if you did?  Quirky may be the answer.  Dan Kaufman created a system facilitated by that allows anyone to submit their invention, and if it’s chosen for development, Quirky will create it in-house.  Once it’s marketed you get a portion of the proceeds.  Even if you didn't submit the idea, but influenced it in some way, you can earn part of the profit.


"We're making invention accessible," Kaufman says.  "Ninety-nine percent of people are armchair inventors. They have great product ideas, but most don't have the time or money or expertise to make them happen."


Kaufman's business model has been a tremendous success.  Each week, the New York City-based company receives more than 2,000 invention ideas from its community, approves three or four of those for development, and ships an average of three completely new products to its growing list of retail partners.  This group includes Target, Bed Bath & Beyond, and Best Buy; online shops (Fab and Amazon); and the cable shopping channel QVC. You can even buy them directly from Quirky's own e-commerce site or via its app, and soon you'll be able to go to dedicated Quirky stores.

Quirky's revenue has increased from $62,000 in 2009, when the company started in Kaufman's East Village apartment, with three employees to $18 million in 2012. Sales are expected to triple, to $50 million, by the end of 2013.


Quirky's online community currently boasts 500,000 members and continues to grow by 20% every month.  Each week hundreds of inventor hopefuls, or "ideators," submit their concepts online. To simplify the development process, product ideas must retail for less than $150 and should not require integrated software.


The community, composed mainly of hobby inventors, students, retirees and product-design enthusiasts, votes on the submissions. The two most popular ideas are sent to an in-house team of engineers and designers to research, render and prototype. At every stage (design, colors, naming, logo, etc.) the community contributes. The best suggestions are incorporated, earning secondary "influencers" a portion of future sales revenue. Finally, if enough units of a product are pre-sold, Quirky will manufacture it.


"Face-time is important, transparency is important," Kaufman says. The company holds virtual town hall meetings on Thursday nights with the whole staff, inviting community members to log on and ask anyone on the team questions.  Most of Quirky's 150 employees, plus an assortment of invited guests, gather for the Eval, a highly stage-directed debate of the week's best submissions, broadcast live over the Internet.

Immediately after a product has been selected at Eval, it moves on to design and conception, where Quirky's industrial designers and engineers use several million dollars' worth of prototyping equipment to realize and refine what most likely arrived on their desks as a thinly sketched idea. Lawyers and IP experts register patents and address regulatory and compliance issues, while the production department sources materials and decides which of the 21 core suppliers and factories will make the product. A quality assurance team tests that product, while another group designs packaging and sends it to factories. Packaged products are shipped off to five global warehouses and distribution centers, which in turn send those boxes on to 35,000 retail locations.


Kaufman puts the upfront costs of building a company around a single product at about $200,000 and that's just to get the paperwork done and the first prototype out. Combined with the risk, most people never get their product idea anywhere near retail shelves. However, one of the hopes is that being guided through the process the first time might also jump-start the creation cycle.


Thirty cents of every revenue dollar goes back to influencers, and a number of them have already earned tens of thousands of dollars.  Quirky retains the rights to all ideas voted into the development process, and because the company gets validation from thousands of potential customers before making a move, Kaufman avoids all the costs associated with early design phases. Quirky, he says, never has to dole out money for manufacturing unless enough pre-orders exist—and customers tell you exactly what they want to buy.


There are downsides too.  Quirky retains all rights to the product once it enters the manufacturing phase. Most of the time the product they end up selling is only partially related to the original idea posted. You are essentially selling your idea for a maximum of 12% royalties (if you influenced a product 40%). Quirky creates the prototypes and the middle man work, which is one perk and could save people a lot of hassle. Quirky provides "innovators" a low reward, low risk way to make money on ideas.


To participate, you must join the website, free of charge, to vote on products or influence them.  This seems to be a disadvantage, but also discourages ideas from getting promoted strictly based on family/friend votes.


If you have an idea that you can't otherwise afford to patent and bring to market, then Quirky may be your best bet.  You might not get rich, but you will be an inventor with a chance to make some respectable money.  If you don't invent something, you can still cash in by influencing other products in their development.