Commentary

Today’s Entrepreneur, Crowdsourced


Elizabeth CullinanA couple of weeks ago, a team consisting of three Carnegie Mellon classmates and I participated in the Hult Global Case Challenge (HGCC). For those who are not familiar, the HGCC is the world’s largest crowdsourcing platform that pulls from top university graduate students around the globe to provide sustainable business solutions to help alleviate global poverty.  The challenge addressed three key global issues: education, energy or housing. The carrot was $1 million in seed money to the recipient non-profit to implement the winning solution. Over 1,000 student teams spent months participating in the challenge. The result was win-win; HGCC now had 1,000 sustainable business plans from the top universities and all student participants empowered as they harness their studies for social good.

So what is in this word “crowdsourcing” that can make new entrepreneurs, or make old entrepreneurs better? The Dictionary defines “crowdsource” as the ability “to utilize (labor, information, etc) contributed by the public often without compensation.”  If you type in “crowdsourcing” on Amazon.com, the result is over 236 books on how to leverage crowdsourcing in one’s business.  This all sounds like a lot of instructional text for something that is provided for free.

Though free, crowdsourcing has proven to be effective and several entrepreneurs literally bank on it. Some entrepreneurs creatively weave crowdsourcing into their business only when needed; while other entrepreneurs have crowdsourcing as their primary business and marketing model.  A perfect example of the latter is the t-shirt company Threadless.com.  Their business begins with crowdsourcing t-shirt designs by creating an on-line platform where any artist can submit a design.  Next Threadless.com crowdsources public demand by asking the public vote on-line for their favorite t-shirt designs.  The t-shirt designs with the most votes are produced and sold.  Kickstarter.com is another company which solely uses crowdsourcing as their business model.  Kickstarter is an on-line business which crowdsources capital for other entrepreneur’s new ventures. Kiva.org brings crowdsourcing to a higher social good by crowdsourcing microfinance loans around the globe.  And the list goes on and on….

Why does crowdsourcing work? NPR covered the crowdsourcing phenomenon back in 2008.  In the article, they interviewed innovation management expert, MIT professor Eric von Hippel who believes “online design is becoming a substitute for in-house research and development while voting takes the place of conventional market research.”  Hippel is quoted “This is really the biggest paradigm shift in innovation since the Industrial Revolution. For a couple hundred years or so, manufacturers have been really imperfect at understanding people’s needs. Now people get to decide what they want for themselves.”

But why do we, as individuals, freely participate in crowdsourcing? Maybe as individuals we all just want to be heard, feel empowered, or enjoy participating in an industry we care about.  I am not exactly certain as to why, though I know I will have the best answers if I crowdsource this question on-line to all of you

Hult Global Case Challenge Winners, CMUOh – as for the winning team from the Hult Global Case Competition, my team from Carnegie Mellon won.  We received great recognition for our achievement and, if I may add, a beautiful winner’s trophy.

Beth Cullinan is currently a Carnegie Mellon University Masters of Public Management student at Heinz College. She and her team will be partnering with One Laptop Per Child to implement the Hult Global Case Challenge winning business plan.

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