When Crowdsourcing Fails: Cambrian House Headed to the Deadpool
Erick Schonfeld
139 comments »
Crowdsourcing sounds good in theory—pull together a bunch of smart, motivated individuals from across the Web to create a new product or business—but in practice it is not so easy to pull off. One of the first major casualties of the crowdsourcing movement looks like it will be Cambrian House, the Calgary startup that tries to organize the crowd around creating new ideas for Websites and software products. After unsuccessfully trying to raise a new round of capital, it is our understanding that the startup has negotiated a fire sale of its intellectual property, assets, Website (and whatever community remains after the sale) to Spencer Trask Ventures, a New York venture firm inspired by the financier who originally backed Thomas Edison.
The deal is structured as an asset purchase, after devolving through various stages from initial talk of a new investment to a joint venture to a buyout. The more Spencer Trask looked, the less it offered. Spencer Trask is basically buying the Cambrian House platform and its community for a fraction of the $7.75 million that investors have already put into the company. We cannot yet confirm an exact figure, but one source speculates that it could be less than $1 million. Spencer Trask plans on taking the assets and rolling it into VenCorps, a Cambrian House project in development that wants to apply the crowdsourcing concept to venture capital. Sean Wise, a Canadian “venture consultant,” is heading up VenCorps and (presumably) whatever is left of Cambrian House. A Cambrian House spokesperson (VP of Communications Jasmine Antonick) contacted confirms that the sale has gone through and that the site will “dissolve” in three months. We are placing Cambrian House in the deadpool.
So far, 6935 ideas have been created on the Cambrian House site. Some of them must be worth pursuing, no? Perhaps. In addition to VenCorps, Cambrian House itself will be keeping some of its more successful projects alive, including desktop fighter game Gwabs, independent-film funding service FilmRiot, Digg-like charity Greedy or Needy, mobile app testing site Mob4Hire, and virtual gift-wrapping app Prezzle. It will also retain rights to its source code and try to license it to others through an application called Knottle and a platform called Chaordix, both yet to be released. Many of these ideas didn’t gain traction until they were invested in and championed by Cambrian House itself, which again makes you wonder whether any good ideas can actually grow into full-fledged products from an unaffiliated crowd.
To be charitable, maybe Cambrian House just suffered from poor execution and Spencer Trask thinks it can do better. But crowdsourced venture capital? If the crowd cannot even make a decent Web app, the chances of its being able to allocate millions of dollars more efficiently than seasoned pros does not seem terribly great.
The imminent demise of Cambrian House is a cautionary tale for other startups, such as Kluster, CrowdSpirit, CrowdSpring, and FellowForce, trying to cut their teeth in the nascent crowdsourcing industry. They all have their own approach, and experimentation is necessary to find the right one.
The fall of Cambrian House won’t deter them from trying. For instance, Kluster takes a more structured approach by breaking down projects into manageable stages and has thought through the incentives a little differently. And CrowdSPRING, which focuses on designs for Website and marketing materials, is formally launching tomorrow after picking a winner for the $5,000 contest to design its own Website.
Some of these will survive, and some won’t. The key is attracting the right community of active contributors and structuring the rewards in such a way that makes it easy to participate. Or is crowdsourcing simply a bad idea that should be put to rest?
Update: In a comment below, Cambrian House CEO Michael Sikorsky reflects (excerpt):
Indeed, our model failed. In short: we became a destination people loved to bookmark more than they loved to actively visit (our traffic pattern was scarily VC-ish). The limiting reagent in the startup equation is not ideas, but amazing founding teams.
A key assumption for us, which proved out NOT true: given a great idea with great community support and great market test data, we would be able to find (crowdsource) a team willing to execute it OR we could execute it ourselves. We needed amazing founding teams for each of the ideas – this is where our model fell short.
What we learned: it would have been better to back great teams with horrible ideas because most of the heavy lifting kept falling back on us, or a few select community members. A vicious cycle was created leading all of us to get more and more diffuse.
Hence: the wisdom of crowds worked well in the model, but it was our participation of crowds aspect which broke down. Trying to find people willing or capable to take on the offspring (our outputs) of the CH model was hard and/or incredibly time consuming.
It is not often you get such an honest assessment of why a business failed from a CEO in the midst of its demise. Sikorsky also disputes that it was a “fire sale,” but declines to give any specifics on the price. He also notes that Cambrian House as a company will continue, even if the site will die, and still owns its intellectual property.
Update 2 (5/20/2008): The company has issued two press releases. One details the sale of assets to Spencer Trask and the other emphasizes that Cambrian House is still a going concern, albeit with a totally different strategy of selling “crowdsourcing in a box” (i.e., licensing its technology to other sites that want to make a go at crowdsourcing). And here’s a 26-minute video Sikorsky made to explain what is happening at Cambrian House titled VenCorps, TechCrunch, and a Loong Talk:
I think the weird name and the logo killed them before they even got out of the gate. Sounds like a recovery house for wayward vikings.
i don’t think the firm Spencer Trask has anything to do with the person Spencer Trask other than the name.
The thing that always baffles me with idea sharing / crowd sourcing sites is this: If you’ve got an idea that you really think is worth pursuing and putting in all the hard work, blood and tears it takes to give even the best ideas a chance to succeed, would you really share it on such a site or would you go for it yourself?
In turn, which are the ideas to post on such sites? Exactly, it’s the things that seem like a cool idea but you’re not sure if it’s worth going for it or you just can’t bring yourself to put in all the risk and work it takes. Why not, post it and see what others think…
In my mind this results in a hodgepodge of mediocre ideas that others haven’t thought through properly (error 405 - business model not found
and /or that they don’t have the chops to go for it themselves.
While this is all fun to share and explore it certainly is not the place where highly profitable business start their journey. Why? Because highly successful and profitable business are the result of good to very good ideas that are executed extraordinarily well. Even fairly lame ideas are can be highly successful if executed very well. Selling cheap computers online and over the phone - not a very cool idea but Dell executes it into a huge success. Starting a trucking company? Probably the worst business to start but Deborah knows how to execute it to success by specializing in HotShot last minute transports for Oil companies (check out her blog http://www.lifeinthefastlane.ca/ and her business http://www.fastlanetransport.ca/ to see what I mean)
So if I can win by executing a so-so idea very well, why would I want to share a ‘great’ idea on one of those sites?
Peter
do you follow me on http://twitter.com/peterurban
“Some of these will survive, and some won’t.”
Erick - at this early stage in the evolution of Web 2.0/online community/crowdsourcing, I think your statement is a tremendous understatement.
Most will fail and very few will survive longer than the initial funding round, as you probably secretly know but don’t necessarily write…
I feel sorry for them, Good idea. Don’t know what went wrong.
sean wise was on the board of cambrian house…why would spencer trask wants sean wise to run vencorp? the blind leading the blind!
http://www.seanwise.com/2007/0.....llio_.html
So what exactly does all this mean? They’re keeping the rights and the silly products, but selling the company? What does this say about the company and the people that work there? Sounds to me that it’s a sinking ship. Unfortunately not all rats leave a burning ship as it goes down. I couldn’t imagine working for a company that sells everything off for a fraction of the initial funding, and then continues to pawn off the remaining stuff.
It’s so sad, I had big hopes for a new method of working on internet related products. I’m wondering if Eric’s statement is correct “just suffered from poor execution”, or is it 2.0 community read for crowdsourcing?
Ask inventive people if they need alternatives to get ideas made into commercialized products/services, and they’ll say yes resoundingly.
Offer a site that attempts to do that and you get a clearer response: “I’ll give you my second rate ideas, but not the winners which I’ll work on myself.”
My bet is that the formula needs to be:
- built off of a trusted source website as an added feature that has thousands of inventive, smart folks already tuned in
- made as a non-profit where funds pay for hosting and charity
- has a positioning of tackling projects where the work is largely labor intensive, variable cost and can be done in assignable independent tasks, e.g. software
Did I just describe open source? Maybe that’s where the model works the best while for-profit cousins may not be in the cards.
Should there be a solution between starting a company because of a single idea v. doing nothing with that idea? Yep. A company with resources and patience will get rewarded for creating ways to reward open, transferable collaborative innovation. My bet is that the company doesn’t even need to be a pure play of ideas (i.e. it becomes an extension of what they already do, re: P&G).
Spencer Trask is a bunch of bottom feeders looking to get something for nothing.
I believe Spencer Trask backs Innocentive, which has seen much success in Open Innovation on the ‘high end’ … tapping engineers, scientists, etc for big-reward crowd-source challenges.
I”m sorry to hear Cambrian House is heading to the deadpool. I wish their employees the best. I don’t feel this will dampen the ongoing search for best models to unleash the potential of ideas. I think the most consistent success will be around established businesses integrating ‘idea portals/communities’ to tap consumer/employee/client ideas and suggestions, rather than using the crowd to create something from scratch, or hosting crowd-sourced contests. Salesforce is all over this (DellIdeaStorm, MyStarbucksIdea.com), Mzinga another great example, and Fellowforce’s new Webforce Co-creation platform is an exciting, more affordable alternative as well.
I’m especially jazzed by the appearance of SuggestionBox.com, recently profiled on Techcrunch. I think it has a great shot at gaining fast traction (the brand/URL alone is pure gold) as a simple, affordable way for any business to ‘ask the crowd’ for feedback and ideas.
My sources at CH are saying that most of this isn’t true. That there isn’t a fire sale. Erick, are you willing to let us know your sources for this?
I think there is still some fight left in Cambrian House.
Brenden
CrowdsoureThis.com
@Tim, lol, you’re on a roll this afternoon.
Crowdsourced anything sounds difficult to navigate if there is hope of revenue at some point. Good luck to all who bother to endeavor, it could be a very lucrative one-off of the incubator model.
I’m a CH member.. they’ve been working on something for a long time.. pretty sure it involves investing in the commuunity’s ideas.. so they’re not dying - it’s a rebirth!
If you don’t believe me then check out this new york times article… http://www.nytimes.com/2008/03.....ref=slogin
Sounds like Google didn’t need all that pizza after all. This is a glorious Web 1.0 style failure.
The employees should be worried. This ship is going down along with all the blowhards that run it.
Cambrian House confirmed most of this post. It wouldn’t comment on the price of the asset sale.
I know for a fact that they were trying to raise more funding, couldn’t, tried to sell the whole company, couldn’t, and finally settled for what they could with the asset sale. I also know the price Spencer Trask was willing to pay kept going down.
I can’t get into my sourcing. Suffice it to say, when I called Cambrian House, the details panned out.
http://www.crowdsourcethis.com.....cing-dead/
A summary of some of the different crowdsourced offerings:
http://www.readwriteweb.com/ar....._guide.php
Seems to be at least some early success stories there!
Wait, confirmed *most* of it? Which parts did they confirm and which didn’t they?
Who confirmed it at Cambrian House?
Also, you mix specific facts from unsourced people with sweeping generalizations of an entirely new industry.
Not impressed.
Cambrian House has some serious branding problems. The name does not even remotely communicate the product/service and the logo makes it look like a professional sporting league.
1) Most startups failed. But CM is more likely to fail because it’s really not a product. It is more like a culture movement. If the general concept is valid, it will take a very long time to take shape. They ran it with a product startup method/structure/burnrate is a bad idea.
2) No valuable intellectual properties would be put into such a CM crowd for its ownership structure. The quality of those ideas there are really questionable.
3) CM really knows how to sell itself though.
Very interesting site from a product-marketer’s perspective but $7.7M is obviously too much. Where did the money go ?
erik, your diligence on spencer trask is poor. they bought one of edisons old shell companies.
@NickeyD
http://www.youtube.com/watch?v=q3BdkToI5Bc
That’s where the money went. What a waste.
The thing that always baffles me with idea sharing / crowd sourcing sites is this: If you’ve got an idea that you really think is worth pursuing and putting in all the hard work, blood and tears it takes to give even the best ideas a chance to succeed, would you really share it on such a site or would you go for it yourself?
In turn, which are the ideas to post on such sites? Exactly, it’s the things that seem like a cool idea but you’re not sure if it’s worth going for it or you just can’t bring yourself to put in all the risk and work it takes. Why not, post it and see what others think…
In my mind this results in a hodgepodge of mediocre ideas that others haven’t thought through properly (error 405 - business model not found
and /or that they don’t have the chops to go for it themselves.
While this is all fun to share and explore it certainly is not the place where highly profitable business start their journey. Why? Because highly successful and profitable business are the result of good to very good ideas that are executed extraordinarily well. Even fairly lame ideas are can be highly successful if executed very well. Selling cheap computers online and over the phone - not a very cool idea but Dell executes it into a huge success. Starting a trucking company? Probably the worst business to start but Deborah knows how to execute it to success by specializing in HotShot last minute transports for Oil companies, check out her blog ‘lifeinthefastlane.ca to see what I mean.
So if I can win by executing a so-so idea very well, why would I want to share a ‘great’ idea on one of those sites?
Peter
do you follow me on http://twitter.com/peterurban
@23 Wow. Was not aware they tried that stunt. Like bringing thousands of free t-shirts to CafePress.
I’ve worked with Sean Wise and he’s first class all the way.
@Voice 2.0: Who cares?
Cambrian House, to date, hasn’t presented a stable business plan to this space.
They’ve tried giving away part of their company (through a Co-op), owning a portion of each idea submitted, viral marketing campaigns…and you know what? Nobody really cares. The fact they wanted the world to believe they’re the ‘Home of Crowdsourcing’ before proving they could facilitate Sourcing of any kind is actually pretty funny.
$7million in Calgary is couch change which along with CH, will hardly be missed.
I’m not an insider on this, but I’ll tell you this:
1. Broad details (funding, sale, sale) are accurate.
2. Actual details (y’know, the stuff that makes the story factual, like “deadpool” vs “purchase” are wrong. Including vencorps isn’t a ch project. St didn’t tap wiswe (other way around), etc.
The story, and angle, on this are off base erick, plain and simple.
Spencer Trask should fund the idea that I shared with the Cambrian House community.
http://www.cambrianhouse.com/i.....d/T49gkhW/
My full response to this:
http://tiny.cc/CrowdsourcingNeedsNewHome
Summary: Crowdsourcing HAS a very successful model (Innocentive). If this one failed (Cambrian), it does not invalidate the entire idea of crowdsourcing. And hats off to the Cambrian community for at least trying.
Erick:
Indeed, our model failed. We’ve spent many hours reflecting on it, and, I’d be happy to share our learning’s in detail with anyone keen on the crowdsourcing space.
But, in short: we became a destination people loved to bookmark more than they loved to actively visit (our traffic pattern was scarily VC-ish). The limiting reagent in the startup equation is not ideas, but amazing founding teams.
A key assumption for us, which proved out NOT true: given a great idea with great community support and great market test data, we would be able to find (crowdsource) a team willing to execute it OR we could execute it ourselves. We needed amazing founding teams for each of the ideas – this is where our model fell short.
What we learned: it would have been better to back great teams with horrible ideas because most of the heavy lifting kept falling back on us, or a few select community members. A vicious cycle was created leading all of us to get more and more diffuse.
Hence: the wisdom of crowds worked well in the model, but it was our participation of crowds aspect which broke down. Trying to find people willing or capable to take on the offspring (our outputs) of the CH model was hard and/or incredibly time consuming.
For clarity of your story, and perhaps, just pride for my team and my investors:
- You missed http://mob4hire.com in your original post. Paul and his team launched this completely using the CH platform.
- The team and community at CH are top-notch. I’d be proud to follow them anywhere.
- We were and are still able to attract investment (this you just have wrong). However, we believed the model was off (once you have this feeling in your stomach you don’t take on additional capital until you’ve figured it out).
- Fire-sale of our IP - two points: #1) We haven’t sold our IP – we still own it – and the IP of the portfolio companies. #2) Erick – you know as well as I we won’t comment on the deal specifics. However, I believe deeply this was the right move for the community.
- The ‘rebirth’ with VenCorps goes to fix the failures I identified above. With VenCorps, the ideas don’t matter anywhere as much as the teams do.
- I’m bullish crowdsourcing but how/what you can apply it to is still under-test.
- Deadpool – yes, our original model can clearly be put to rest. However, the same can’t be said for the company.
Michael Sikorsky, CEO of Cambrian House
I was presenting at an Angel Forum and these guys were the talk of the town. Mostly because the CEO was very charismatic (he showed up in jeans+tee shirt and pulled it off).
The problem IMHO is not with crowdsourcing in general, it’s _what_ you’re crowdsourcing that matters. In fact one of the guys involved with CH was a former exec with iStockphoto. I’ll bet you 50 million dollars the guys at iStock don’t think crowdsourcing is a failure.
Crowdsourcing articles (Wikipedia) and photos (iStock) was a stroke of genius. Crowdsourcing ideas? Not so much.
Ideas aren’t worth anything. Kind of like opinions in blog comments.
Like this one
@Michael #31
What a refreshingly honest and reflective response.
So in summary: Long Live the Potential of Ideas … but the Executioner’s Song is that Execution is Key … or Ideas are Powerless.
@ Michael
Nicely put!
Cambrian House is like every other start up that starts out with one vision in mind and follows another path. The main thing learned here that great ideas are useless unless there are enough great minds/hearts to follow them through to actualization-something very rare in this world. Most people have a great idea and sit on it until someday some else does it and they say, “hey, I thought of that years ago!” Really - whomever your Cambrian House spokesperson (a lofty title at that) is,obviously has some bone to pick b/c a lot of your details are one sided and fabricated to hurt and embarrass CH.
CH took on an idea that was maybe too big for it’s britches and is better off in a VC types’ hands.
Michael,
Sorry to see this outcome, and I don’t want to appear to be putting salt in the wound but the team/relationship aspect was the key weakness I identified when I wrote about you a year ago. Best of luck going forward.
http://jeffnolan.com/wp/2007/0.....gets-real/
Why do I get the feeling #33 and #34 are fanboys?
I agree with #19, the branding was a disaster.
so bad…
as a non-english speaker It is hard for me to remember the name,
I discovered their site a year ago and NEVER NEVER NEVER I’ve been able to type it correctly! I always have to google for crowdsorcing…
But I still have faith with crowdsorcing,
I specially believe in the http://www.pixish.com/ project from that ex-JPGMag guy.
@37 Nope, I’m just a big fan of Open Innovation and the potential of ideas, especially CGI (and employee generated as well). What and who are you? Hard to tell when hiding behind a non-link.
Kluster. haha ok, Let’ play Word Association:
Q: Coca…
A: Cola.
Q: Microsoft…
A: Windows.
Q: Kluster…
A: F#$k.
For comment
دردشة
شات
@ Michael, #31, Good for you to put the horse down in your own words.
For those of you interested in learning from the Deadpool, I thought I’d add some more history as CH wasn’t the first and won’t be the last. Here are some notables for the record as added history on the crowd sourcing space:
2000/2001 - InnoCentve and NineSigma kick off, though, these are really not crowd sourcing as much as they are crowd competition in parallel. Great models, very well executed by both companies for the arenas they serve.
[See: Wikipedia for InnoCentive, NineSigma home page]
2002 - Howard Rheingold writes Smart Mobs along with a great blog on the topic.
2003 - Henry Chesbrough writes Open Innovation: The New Imperative for Creating and Profiting from Technology
2004 - Anand Chhatpar started Brainreactions as a real life brain storming business serving a ton of Fortune 500’s. A different spin on InnoCentive and NineSigma in that they create a few hundred ideas around a need area in 3 hours (what I’d call the fuzzy front end) and give an analyzed, filtered as well as unfiltered list to the client. Great service that continues to do well.
2005 - Erik von Hippel publishes Democratizing Innovation which is free from his MIT site in PDF form.
2005 - Ken Thomson writes The Bioteaming Manifesto which can be found on ChangeThis. Ken has adopted his thoughts into his start up, Swarmteams.
2005/2006 - My company, Invequity, launches I4E as an ‘online collaborative invention network’ to foster networking to the ends of creating licensable ideas using social networking and profit sharing. While some larger clients, dedicated inventors and ideas came about, we needed to do much more to get ourselves ‘out there’ to target our core audience and in the end, we moved on to bigger problems that were easier to solve. The majority of our efforts are now rolled up into the bigger vision of Patents.com LLC. (@Michael/CH, we also got the shock value by being put in the deadpool even though we did a similar-style sale).
2005/2006 - Rob May headed up a concept called The Business Experiment (TBE) that started to get traction in early 2006 and ended when the final voted idea needed to get to execution. Rob addresses his learnings if you Google “The Business Experiment, BusinessPundit”
2007 - Dell Ideastorm deserves credit as being an early adopter of raw ideas being populated and discussed in a community setting.
2007 - Incuby launches as a showcase for inventors. No idea where this is at v. goals.
I’m sure I’ve missed some other important ones that Brendan has covered.
When we were formulating ideas around this arena back in 2004, only Yet2 was noted as a key player in idea transfer which didn’t have direct experience. Any current player [with funding] would be well served to connect with people that have spent time and capital into what worked and what didn’t.
@eve…
exactly where we wanted you.
Love,
Ben
We hear that Silicon Valley Hot Shots Decision Counsel were brought in to keep the VenCorps project on track. http://www.vencoprs.com
I’ve updated the post with Cambrian House CEO Michael Sikorsky’s comment. Thanks for the honest reflection. (I tried reaching out to Michael before I posted, but I learned later he was on a plane, so I’m glad he decided to add his perspective).
I also updated the post to include Mob4Hire as a surviving project, and identified the CH spokesperson I talked to, VP of Communications Jasmine Antonick:
http://www.linkedin.com/in/jasmineantonick
@jeremy, #28, I guess I’ll take Sikorsky’s word over yours. And if you go to the Vencorps link in the article, you will see that it is indeed hosted by Cambrian House.
-Good CEO
-Bad Company Name
-Bad Logo (what’s a viking got to do with anything?)
Ben Kaufman,
you and every other guy wanted me there.
show me the goods, big boy.
Crowdsourcing is an interesting concept… but saying CH is therefor a good company is a stretch.
the tech industry is littered with smoke and mirrors - companies being folded into each other for tax losses and then the owners/investors talking about it as if it were some sort ‘exit’ is just a fraud.
7.7M dollars could do a lot, but in this case did very little.
Pizza’s for google, sponsoring trade shows, give aways, stunts… PR galore but nothing substantive. I think if you have a private conversation with the investors you will find few who are happy with the management team and fewer happy with the results.
Crowdsourcing will go on, and CH will rightly be remembered as a company which pretended to know something about it, the webvan or etoys.com of web2.0.
@Perry: What makes a good CEO? Blowing through that much investment capital with nothing to show for it? Sounds more like a self promoting CEO to me.
I’d like to understand what the investors of Cambrian House are feeling right now and if a return from their $7.5 million will ever be realized. I’m not sure how a company that was supposedly built with a ‘great’ team can go out spending money on stunts and making noise when there was nothing to make noise about. Trying to get buy in and public attention through costly PR events on just an idea that kept evolving every week seems careless and bad leadership. If I were an investor at Cambrian House I’d be pulling out my hear out and screaming to get everyone together and demand accountability. I can’t assume that most investors were oil or tech rich VC that wouldn’t miss their $$. Sounds like there are a lot of investor either first time or friends and family members who’s money will be lost and won’t be happy, as I know of two investors that fit the later profile.
Sure I’ve had my share of investments and more then not they result in failure, however, the difference here is that all of the companies I’ve invested in have been frugal with their $$$ until they actually had something that generated at least some revenue and knew where they were going.
I guess my comments are really about offering my condolences to the shareholders and investors of Cambrian House. It seems like the CEO is quick to admit mistakes but seems to continue to press on as if nothing is wrong and that there is no need for worrying and that Cambrian House will still make money. Help me understand really how this will happen.
I’d love to hear from investors of the company on their take and how they feel about the recent posts and news. From what I’ve heard, there were a minimum of two rounds of investments and those in the first round who were essentially the ‘founders’ have disbanded and upset with the direction of the company. I’m pretty sure this is accurate but feel free to prove me wrong.
PS @46 - Good CEO? I’m not bashing the CEO but sounds like bad direction and leadership. I’d agree if it was bad company name, bad logo, good CEO at an investment of $1million or so, but $7.5 for what they’ve done… tough pill to swallow.
Sure I’ve had my share of investments and more then not they result in failure, however, the difference here is that all of the companies I’ve invested in have been frugal with their $$$ until they acutally had something that generated at least some revenue and knew where they were going.
I guess my comments are really about offering my condolences to the shareholders and investors of Cambrian House. It seems like the CEO is quick to admit mistakes but seems to continue to press on as if nothing is wrong and that there is no need for worrying.
I’d love to hear from investors of the company on their take and how they feel about the recent posts and news. From what I’ve heard, there were a minimum of two rounds of investments and those in the first round who were essentially the ‘founders’ have disbanded and upset with the direction of the company. I’m pretty sure this is accurate but feel free to prove me wrong.
PS @46 - Good CEO? I’m not bashing the CEO but sounds like bad direction and leadership. I’d agree if it was bad company name, bad logo, good CEO at an investment of $1million or so, but $7.5 for what they’ve done… tough pill to swallow.
@ Hey Perry - you hit the nail on the head - sounds exactly like a self promoting CEO. Sounds like Michael Sikorsky spent more time worrying about which magazine and forum he could be in than actually creating something that provided shareholder value. I’ve been following the Cambrian House story for some time now and from an outsider looking in, was always baffled how many times I kept reading the same thing over again but with a new spin and twist. I honestly was cheering for CH and thought that they’d find their way. You can only spin it so many ways until it catches up to you. Sikorsky - charismatic yes, good CEO - doesn’t look that way.
@50 Tech Investor - I wouldn’t be surprised if there are a lot of investors sharing your thoughts and demanding answers right now. Lot of s%*t has been thrown on the wall and seems to me like it’s all starting to come out.
Let me add another crowdsourcing site to the list mentioned in the article: FOSS Factory (www.fossfactory.org). We intend to aggregate the critical mass necessary to implement niche software needs that are ignored by large software corporations and are too expensive and complex to be developed by smaller companies. We do that by providing an online model that enables collaborative design, funding and development of any free/open source software idea.
So we are a crowdsourcing site that is focused on free/open source software only, and are truly collaborative in all aspects of development.
Check us out, we have recently launched. The source code of the site is free/open source as well (we believe in our product) and we are using the help of the community in developing the site itself (we eat our own dog food!). First successful submission happened yesterday, the project was to enable anyone to vote for multiple projects on our site.
Right now we’re working on finding a beach head; a project that is commercially attractive, is in a field that has a strong community base, and most importantly has a spear head or a dedicated person who wants to complete the project. Right now our potential beach head is a software project that enables a webcam to capture motion. That’s a niche software need for the homebrew video game development community. Let’s see how it goes!
John - love your post. I’m sure there are a lot of questions the investors have right now and hopefully they’ll get their answers. It would be a big win for Sikorsky if he would be able to at least monitize their products and be able to give something back to the investors.
I am Paul Poutanen and I am President of Mob4hire (Crowdsourced Mobile Application Testing).
Firstly, I would like to state that Mob4hire was launched entirely using members of the Cambrian House community but not with Cambrian House investment. Mob4Hire is not and has never been owned by Cambrian House in whole or in part. Mob4hire Inc. is a private corporation. I think it was a little unclear above.
Secondly, Mob4hire has been built using some amazing people from the Cambrian House community. Michael’s comments re having a great team are very true. I feel lucky to have the truly amazing people we have on our team. We are doing very well and we plan on continuing to do so with our particular version of crowdsourcing.
We would have not been able to launch without Cambrian House. However, it is important to realize that a startup is a startup. (with or without crowdsourcing). Nothing is magical. It takes hard work and long hours to achieve your dreams.
@Paul Poutanen #54
So are you saying that CH employees while on the CH payroll were moonlighting to help you build mob4hire? Were they using knowledge gained at CH at the expense of CH shareholders?
Or were these CH community members getting together on the CH website?
Either way if CH enabled this shouldn’t CH be sharing in this or were you able to find a way to avoid their royalty sharing program? Seems to me this is much more of a story of CH’s failure to create and retain value than any sort of success - perhaps CH’s sahreholders will want to share in the fruits of their investment?
@john #54
Mob4hire was built with community members from Cambrian House not staff.
The royality sharing program has to do with sharing with community members not Cambrian House.
Mob4hire owns 100% of its intellectual property.
I for one look forward to this change in a positive light. Sounds like a “rebirth” is a great opportunity to innovate based on first hand experience.
Just for the record, my first idea passed through the Cambrianhouse beehive. CH turned out to be an invaluable source to test and filter out the noise in your head.
/ooper
http://www.socialthumbs.com
@Tech Investor #50
I’m a CH investor. For the most part, this is not as bad as the article portrays it. But hey, that’s what media is about these days right? Shock value.
Regardless, it’s sad to see the state CH is in. It’s not so much the money as it is the relationship with former employees and its reputation locally. They managed to churn through a lot of people in a hack n’ slash sort of way. I don’t get a lot of positive feelings from former employees.
Furthermore, while I trust that Mr. Sikorsky wants to do the right thing, at this point it’s not about intention or trust. It’s about capability. I fully trust that Michael could lead a successful project or business toward a positive end, but its in these tough times where he’s untested as a CEO. He’s well read and applies a lot of effort, but I’m just not sure the capability is there. If there is a reason to replace him, it would simply be for a lack of experience in digging a company and a lot of potentially angry investors, ex-employees and a community out of a $7 million dollar hole.
Perhaps Sean Wise is up to that challenge. I look forward to seeing the new structure.
Here’s my view as a long time member of the CH community. For those who don’t actually know the different between a CH community member and a CH employee, maybe you should join up. It demonstrates a certain lack of credibility.
The CH model in recent years has intended to facilitate introducing people from different backgrounds (entrepreneurs, developers, marketers, managers etc.) and through using the collaborative features of the site, to create a mixing pot that along with the community members, you’d throw in some ideas and if the stars were all aligned, you’d end up with a valid business idea, committed participants and initiation of the next steps of business planning / execution.
No one said it would happen hourly, daily, weekly, yearly. No one can always pick a winner and it takes a lot of ideas and people to finally get a few runs on the board. Arguably cash incentives couldwould have increased momentum but without it, the signs have certainly been promising on a smaller scale.
This year it seems as though CH really has started to gain momentum. So from my perspective, I see the new model announced in the times as crowdsourcing evolution, continued innovation and a warning to sites that came along after CH that they’d better pay attention because these guys are moving closer and closer to mastering the wisdom of crowds and turning it into m00la for everyone involved.
To me, behind the scenes, VenCorps was always in existence. Sean Wise was available to provide guidance to popular ideas and I’m sure there would have been VC opportunities if he liked what he saw amongst the pool.
From the little information we’re reading, the new model is taking the approach above and making it a formal part of the Cambrian lifecycle. A new name helps to spice it up a little I guess but I’d be just as happy with it staying the same.
The thing that does annoy me, however, is that it appears that they’ve gone outside of the community to leak details of the new model first. This is a very minor issue and I’ll build my bridge as soon as I hit submit on this post.
I have been active on cambrianhouse.com for a while and throughout the journey I have and continue to, meet some amazing people and am also currently working (albeit slowly) on making a great idea a business reality. Amazingly, this is without either myself or my partner needing cash incentives up front, just like mob4hire.com. The community is great and I hope that the spirit continues within CH 3.0.
@ Paul #57
maybe this is why CH was destined to fail… if the CH members
- BUT not CH -
could share in the idea that was mob4hire, even though it was CH’s platform which allowed them to know about you AND participate in mob4hire THEN how does CH make money?
If you get the benfits of the CH community but the company and the shareholders that made the community possible don’t get anything then CH must be a charity?
As Sikorsky and you both agree that Mob4hire was built on the CH platform, and it was the shareholders of CH which made the platform possible, are they not being unfairly cut out?
I suspect CH’s investors did not finance it to create a charity, they invested to create a business.
Is it possible to use CH’s platform and community without CH participating in the upside? If so, then at best CH’s management is naive if not negligent.
Did you ever check out some of the ideas in the monthly idea section? My favorites last month were 1) Canope for Canoe (yes, they couldn’t even spell canopy correctly) 2) Crowdsourced Food Delivery - where customers would deliver food (and boogers) to other customers. Gross.
Given the quality of ideas and lack of proven Cambrian business models, maybe CH should have crowdsourced some standards for idea submission and publications (i.e. let’s screen some ideas before letting them go live).
I’m also unfortunately a CH investor (but fortunately only a small amount of $$$).
@#51 Tech Investor, you seem to have it dead on. A decent idea in the hands of weak leadership. I first got involved over a year ago. But shame on me, only after I invested did I dig deeper into Mr. Michael Sikorsky’s background and experience.
@#50 Hey Perry, you are right, Sikorsky first introduced himself to me by talking about all his multiple previous startups. But just check his LinkedIn profile and you see that a lack of real direct experience in running a company or even directing a management team. Also almost half of the professional listings under his professional experience are as him being an ‘angel investor’ for companies???? Is that really considered professional experience? I’ve never listed on my resume where I have invested $25k into some private venture……
Eric is right about execution being the important followup to a good idea. There has been a steady stream of experienced top-notch talent that came and went through the Cambrian company. That’s always a warning sign and I guess a leadership issue once again. You’d think that would have been a tipoff to the board of directors months and months ago about where the company was heading and where the problems were?
I would agree with what @#52 Right on the money said. Sikorsky obsesses alot about what interviews he’s done and articles he was quoted in, even listing them all on his LinkedIn. A lot of energy put towards self-promotion bluster instead of executing, building/retaining a strong team, and delivering revenue.
Yah, I feel a bit stupid for going in without better due diligence, but at least I didn’t bet my firstborn child on this gamble. And I’m not trying to slam Sikorsky because he sure has a knack for promoting ideas (and himself) and convincing people he knows what he’s doing. But he sure hasn’t proven himself as a CEO who can lay out a good strategy, execute on a plan, oversee operations, and get a company to revenue. My fault for buying in blindly.
@#63 Warren:
Sorry to hear about your loss. I have noticed over the past 2 years how many people have come and gone on the Cambrian House staff website. I always assumed they were contractors being brought in to help build something and then moved on.
@#55 Paul Poutanen
From your blog, it looks like you either work for Cambrian House or, in the very least, act as an advisor (is says as much in your blog and the Cambrian House People page has a ‘Paul’ listed as an advisor). Does that really make you a fair judge of whether this system works? Are you also a shareholder in Cambrian House?
@#64 Hey Perry:
What I have heard from a handful of people who used to work there is that every person at Cambrian House was brought on first as a contractor and also required to become an investor in the company. Some great people were badly matched to unsuitable roles/projects and there were lots of complaints about chaotic project requirements, control issues, lack of support, respect, etc. etc. Maybe it is a biased sample, but none of them aren’t happy to be out of there. The big complaint is that they felt the company was just randomly burning through the cash (and people) without having the discipline to complete any products.
@65 Warren
As an investor, were you given any indication that this Vencorp activity is in the works? Have they sent you anything?
@66 Hey Perry:
I know an investor email newsletter update was sent out to us 1-2 months ago. I can not recall if there was anything about Vencorp in it though. I had already given up on this investment by then so I only skimmed it.
My hope is that all of you will understand what actually happened someday down the road. None of you know the entire story.
Michael is committed to his shareholders and providing them with a return.
At this I’m sure Michael will succeed.
@ cookiemonster
Some of us DO know Michael and what sort of stuff he has pulled, lied about, done, and regardless of how ‘committed to his shareholders’ he is, he is NOT a good person. Quite far from it. Ask his old business partners, his friends, people he looked in the eye and swore he would be there for. Yeah ask THOSE people and you’ll find out a whole other side.
Cambrian House failed for a whole bunch of reasons. You just have to read all the comments here to know the challenges it faced. One thing I would like to add is that there still is a number of GREAT people still working for Cambrian House. I’ve heard it’s a great place to work regardless of the leadership from Michael. I wish all the best to them if Cambrian House closes.
@ Jeffery 69.
Like I said…you don’t know the whole story.
I know why CH failed. Lots of simple reasons and lots of complex reasons.
(No one here mentions that they were trying to build five companies at once-and not one of the employees of the past or present could push any of those sub-companies to the next level - some team!)
Sure, blame it all on Michael - it’s like blaming the entire problem the US is facing with the economy solely on George Bush…as if he is the only person running the country.
That’s pretty ruthless though, judging that someone is “NOT a good person.” Who are you, God? And who should he “be there for?” He’s still there (for Cambrian House), pressing forward.
Outta here.
@cookiemonster
So, I’m guessing you’re either MJ or one of his brain washed minions. Hijacking this thread with his own self-serving BS while his company is drowning is fairly representative of his narcissism.
I’ve heard it was mostly his fault. Lying to investors by stretching the truth to its limits, wasting valuable company resources at critical times on vanity projects, not even knowing/caring about what his company was building for months on end, abusing company funds for his own self-promotion, firing dozens of employees without a hint of real human emotion, betraying his closest friends, misrepresenting activities and opportunities to the board and the shareholders. Really swell human being.
After all that crap in the presentation about acting as if karma exists… I suppose that applies to everyone except him? You couldn’t name one friend he brought into that company that thinks the same of him today.
Hi All: Mike Sikorsky along with several other crowdsourcing company founders will be at a Stanford / MIT VLAB event on Tuesday May 20th. We’re crowdsourcing questions for the panel — this sounds like a great group to tap into. Please post any questions you think should be asked of CH and other companies to:
http://ask.metafilter.com/9127.....wdsourcing
Thanks!
Event Info:
http://www.vlab.org/article.html?aid=184
@70 cookiemonster
I worked there. I’m guessing you did not.
Prio CH models failed due to poor execution. Simple as that. Blame the team(s) if you want. The simple fact is MJ’s inability to distribute authority killed anyone’s ability to move an initiative forward. Robinhood Fund was an exception and when it gained initial traction, the writing was on the wall. Every member on that team was pulled and it was left to die.
A real shame.
All I know is I witnessed the chaos first hand and any attempt to exonerate MJ while stringing up his teams is wrong.
5 companies under 1 roof….MJ’s idea.
@ cookiemonster… why don’t you tell us the whole story then? I’m an investor in CH and after reading all the posts, including the last few ones by Google, Jeffery and Warren I couldn’t agree more. It’s sad that it’s come to all of this but it was only a matter of time before investors, past friends, and ex-CH workers started to share their thoughts and voice their opinions around what has happened in the past few years at CH. I personally am insulted by the way I had to hear about where the new turn of events through these posts and not directly through CH which leads me to believe the ship has already sunk. What happened to all the promises of a tight community, informing shareholders every step of the way… and a bigger question I have is - while we are all blaming MJ, where’s the accountability from the Board. We put our trust at the beginning in MJ and when that failed looked to the board to control the spending and MJ’s destructive ways. I still don’t understand how a company of less than 25 people can spend $7.5 million in only 2 years the way CH did. I really want answers.
And cookiemonster - just for the record, your post just validated everything everyone has said on this thread based on your remarks. Google- you’re probably right, either MJ or one of the few CH employees left still being manipulated by his ways (but honeslty - only MJ would bash the past and Present team publically like it’s their fault when they don’t do anything without his direction). At least if you’re going to try and defend MJ and CH, add some substance behind your defense.
I guess what I’m really looking for is for the investors of CH to really get together and have a serious and long discussion around what we do from here. I think it’s important to mention that I’m not pissed that my investment in CH may already be lost - that’s the nature of investing. I’m PISSED because of exactly what everyone on this thread has talked about because it’s true - so cookiemonster - we don’t know the whole story? Let me summarize - throughout the investment pitches, MJ talked about building a company around a great team, reached out to all his friends for investments to start a great company and sold the idea to investors that it wasn’t even just about an idea but about the founding team members and what they brought to the table. Oh, and yeah Google – you’re right about the “Whether Karma exists or not, act as if it does” crap MJ fed to everyone as his closer… So after all the money came in what happens? He destroys the team, tells everyone they’re crap, spits at Karma in the face and uses everyone in his path (wait a second, isn’t the CH logo a Viking? Hmmmm interesting).
The thing is all this info and opinions expressed by everyone on this thread is not new. In fact, people have been feeling it and thinking it for years, but for the sake of the company, we all kept our mouths shut and that’s just not going to happen anymore.
Here’s a message to Michael Sikorsky: While there are a lot of angry people out there right now in the CH community, why don’t you address the shareholders and at least face the music. If it’s not as bad as some people say it is, why are we not hearing from anyone?!?! I think a CH investor meeting would be in order within the next few weeks, whether MJ organizes one or the investors do. I just feel that a lot of crap has surfaced recently and every person deserves to defend their name and reputation so here’s your chance.
@73 Core Values
It sound about as bad as I had been hearing. When you look at the pedigrees of many of the people who passed through the Cambrian doors (veteran programmers, experienced project managers, previous company owners, people who have worked many years for large successful companies) it is hard to imagine they were not able to produce at least one decent product. It becomes hard to blame the individual team members after a while.
From what I understand, the only people still there day to day are really junior folks just out of school, I’m guessing all under 30. All of the senior people are long gone.
@74 Tech Warrior
You ask a great question, where was the board through all of this? You would think that anyone with the knowledge and background needed to serve on the board of an internet tech company would have seen the warning signs and pinpointed the root of the problem a long time ago.
@Warren
There was some all world talent all right. That said, all world talent doesn’t always make for a great team. In this case, it obviously didn’t. I suppose the group of us could have done a better job at confronting MJ and insisting he articulate the vision and get out of the way while it was being implemented.
That’s a regret I’ll always have.
I’m a little confused, perhaps someone here can help me.
where to start…
1st I am an investor in CH, but admittedly, and it is now more apparrent than ever, a novice at investing.
2 years ago I decided to invest in a ‘private’ company here in Calgary. I met with 3 CEO’s - Curve Dental, Shopster, and of course CH.
Curve - Matt, Dorey seems like a nice guy, pretty young though and dentistry…boring!
Shopster - Sarath Samer…? Obviously very smart, good experience, but kept talking about business model and revenue streams and how to make the company profitable for Shareholders and customers… too business like.
CH - MJ Sikorsky Crazy hair, jeans lot’s of big ideas and we’ll figure out the business plan as we go along… the stuff of dot-com wet dreams&