Troubling news emerged from the new product development community in New York last week. A well known crowd funding platform (with an unconventional and offbeat name) that brought interesting consumer products to market filed for bankruptcy. Since it’s founding, they brought almost 400 products to market. Blue chip corporations and venture capital firms had invested more than $185M to tap into the deal flow of new products.
Were they too quirky for their own good? Perhaps … While early stage companies, start-ups and inventors form a portion of our client base, they don’t represent a majority of the work that we do. We purposefully limit them to less than twenty-five percent of our projects.
Why? For two principal reasons:
- There’s a limit to the amount of coaching, hand holding, love and manufacturing therapy that we can provide.
- There isn’t an endless supply of money to fund smart pitching machines, Internet enabled makeup compacts and next generation pet food dispensers.
After more then eleven years of doing this for a living, ‘Projects We Love’ (to borrow a term from another crowd funding platform) are fairly rare. About 1/200 new product concepts make us really get excited and think “wow – that’s a great idea – I’d buy that”.
That leaves 199 projects that occupy the category of “Projects That We Don’t Love, and May Not Even Like”.
While we’re not the perfect predictor of commercial success – I’m sure that a few good ideas that didn’t make it through our filter ended up being fabulously successful. But not many.
What does this mean for design engineers, industrial designers, UX specialists and business development gurus? The gold rush to chase down, develop, prop up and fund the next great idea may be slowing down. ‘Smart money’ is getting smart again. If you’re willing to roll the dice with an early stage company, make sure that they’re building a cutting edge product that consumers can understand, have a tried and true way to purchase and don’t say ‘yes’ too often.