Kluster's Ben Kaufman: On to "Quirky"

Posted by: Stephen Baker on April 10

Ben Kaufman came in today. He’s the 22-year-old entrepreneur I profiled a year ago when he was launching a startup called Kluster. Some would call Kaufman a serial entrepreneur. (He missed much of his senior year in high school while getting his first manufacturing line running in China.) I might call him hyperkinetic.

Anyway, he told me he had something new. So I thought it would be a good time to catch up. Last I saw him, he was setting up Kluster. It’s a software system that creates virtual communities to solve problems, design products, come up with ideas. It involve an economy, and contributors build up equity in projects they contribute to.

He spent nearly all of his startup capital developing the product and then promoting it at the TED conference, where attendees used Kluster to create a new board game. He returned with a ton of brand equity and some interesting software, but no real business and a host of extremely uneasy investors. “I was getting extreme pressure,” he says.

He and his small team went without pay for a few months and put together a business that worked. But instead of the original vision, in which a global community would collaborate on all sorts of projects, they found that companies simply wanted to use the software to engage their own teams. Now Kluster is in the black, he says. He has doubled his team in the last couple months to 14. But it’s not exactly the kind of business he envisioned…

So he's off to the next thing. It's a Quirky. Here's how it works. Let's say you have a killer idea for a business, but really don't have the time, or money or know-how to launch the thing. You send your business plan to Quirky along with $99. Each week, Quirky, working with tens of thousands of people in Kluster's network, will select one project to develop and prototype. It could be tent. It could be a new type of pencil, a pogo stick. Anything goes, he says, with the exception of consumer electronics--which might come later.

Quirky manufactures the product in the United States (There's lots of idle capacity, Kaufman notes.) and hopefully sells enough in the first tranche to establish the market and make back its costs. Then, if the product is successful, it continues to manufacture, splitting the take with the founder and other idea contributors. (And all those unchosen inventors, who sent in product ideas and $99? Their consolation prize is a load of market information, including demographics, detailing the community's response to the product.

This type of open-source manufacturing on the go might sound crazy, but you have to remember that Kaufman is a guy whose team created a design studio at a trade show. He and his team solicited ideas, and over the course of a sleep-deprived three days, they built a prototype of an iPod accessory, later selling hundreds of thousands of the so-called Bevy in global markets.

The other lesson from Kluster is this. If Quirky doesn't pan out as envisioned, it might evolve into something that does. By that point, Ben Kaufman will likely have another idea or two.

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