Crowd Sourced Software?

Man, what a loaded term . . . almost smacks of trying too hard . . . :)

Cambrian House had previously been best known for their ill fated attempt at bringing Google employees a taste of life outside of Cordon Bleu Googlex. But lately they have been making some noise with a cute little website called the RobinHood Fund . . . its a combination of and

Intriqued, I finally took a look and is facinated with their approach to website development and idea sourcing. I cant say that I’m impressed since that would connote full fledged “bet my money on the idea” kind of support. (I’ve only done that to SpotRunner, Meebo, Lala, and oDesk) BUT I will say that I’m facinated enough to spend about 5 hours this week on the site playing, contributing, and even discussing a few ideas . . . and to say the least, I’m a little addicted. I even submitted one of my crazy ideas to get the full exprience. (shameless plug, please vote for it)

So what is Cambrian House? Taking away the ultra marketing speak . . . it is essentially trying to extend the open source (sourceforge) model into ideation and marketing while attempting to create an incentive and selection system that encourages participation through out the software development and venture startup cycle. Its an open incubator on stanlozolol. Or American Idol for web based businesses.

As much as I like the idea . . . there are a few things I wish to improve

- Make it more explicit what is in it for Cambrian House. Each project has about 1500 royalty points which essentially equate to shares. Gross Margin of each of the project is split between point holders. I’m unsure if Cambrian House is trying to make money between Gross revenue and gross profit or if they are taking royalty points as well.

-Even more mind bending are the terms and conditions.

Its essentially saying that you are giving exclusive rights of your idea to CH and forgo any commercialization rights for the next year (or more if it builds it) . . . Legally I understand why the lawyers would want to formulate their Ts&Cs in this manner. However, in the spirit of “crowd sourcing,” ownership should belong to the community (and the submitter) not CH. If I were CH, I would give equity in CH ITSELF as well as royalty points in ideas to the entire community.

- Another more strategic issue is that I’m unsure how more complicated ideas can get their proper vetting. Anything that has more long-term implication with no revenue or negative profitability implications in its early lifecycle (like Google) will not be approved since the royalty system is revenue driven (another reason for giving out equity). Today, most of the ideas are features or products rather than a full fledge company. It will be really hard for the “next big” thing to come out of the CH vetting process if it has a serious “investment” period. Probably even harder is the fact that each “idea” only gets 1000 words. I’m pretty sure not all business plans can be distilled into 1000 words (a lot can but not all).

- In a similar vein, once an idea has proved to be successfull, does CH intend to “spin out” the project so it can get the proper resources it needs to succeed? The initial idea for youTube would be very much executable under CH’s model. However, the business of running youTube and the current functionality available requires a full-time team to implement.

- Another question for me is that every open source project or business usually has a “visionary” or a “project manager” . . . essentially someone that acts as the heart, soul, and conscience of the project. CH seems to promote specialization to the point that the sense of ownership might become very dilluted and coordination become disjointed.

In the end, these are just superficial warts I believe the community model will rectify collectively (as long as CH listens to its community). I like CH very much. At the very least, it is a deserved social experiment on revamping the current venture capital/entrepreneurship process.