As I wrote on numerous occasions, in recent years crowdsourcing has become a popular topic in academic circles, business publications, and social media. Yet, its acceptance as a practical problem-solving tool has been relatively slow.
There are a few reasons for the slow adoption of this potentially powerful open innovation tool (see, for example, here and here). One of them is a huge number of different crowdsourcing platforms available in the marketplace, with some experts putting this number at 1,000 worldwide.
Obviously, navigating such an ocean of different options is challenging, to say the very least, especially for the organizations new to crowdsourcing. Mistakes are quite often in matching problems organizations want to crowdsource to platforms best suited to deal with each specific problem.
Do we really need a thousand different crowdsourcing platforms? Hardly. In fact, many of them appear and rapidly disappear without leaving any tangible record of performance. Besides, even the platforms that are still in business often do an awful job of differentiating themselves from others.
What is also puzzling is that there is almost no M&A activity in this space. As far as I remember, the only known M&A case involving a crowdsourcing platform was the 2018 Planview’s purchase of Spigit, a developer of innovation management software. And back in 2015, IdeaConnection, an open innovation service provider, and Brightidea, another developer of innovation management software, announced that they had formed a technology and services “partnership.”
The partnership between IdeaConnection and Brightidea, while no formal M&A, was a step in the right direction. Creating a one-stop-shop of innovation services could potentially help organizations launch their open innovation initiatives without the agony of going through an oversized toolbox of almost identical tools. Such partnerships could also emphasize the urgent need for consolidating internal corporate innovation programs with external (open) innovation activities.
It appears that the idea of forming “partnerships” between innovation service providers is gaining traction. Last December, a popular crowdsourcing platform HeroX signed a strategic partnership agreement with Ideanco to launch two challenges focused on climate change and food security. The partnership will also help develop startups incubated within the Ideanco Innovation Lab.
And just a few days ago, a veteran of the open innovation movement InnoCentive has signed a major partnership with the UK idea management company Wazoku with a purpose to create the world’s most comprehensive open innovation platform. The partnership is expected to integrate Wazoku’s Idea Spotlight innovation platform with InnoCentive’s global network of more than 400,000 expert problem “solvers.” Announcing the partnership, Alpheus Bingham, CEO and co-founder of InnoCentive, has specifically mentioned customer demand for “integrated offerings.”
It remains to be seen whether any of the established “partnerships” evolve in something more formal. However, the very trend of consolidating available open innovation services looks very attractive.
Check out my eBook, “We the People of the Crowd…,” a collection of stories about crowdsourcing reflecting my personal experience in working with corporate and nonprofit clients.