Crowdsourcing and crowdfunding meets mass customization – Innovative investment model for startups

InnovestmentA group of entrepreneurs from RWTH Aachen university have developed an interesting model of crowdfunding in the early / seed financing sector — and one of their first projects is a mass customization start-up in the game market.

The start-up, Innovestment, is a crowdinvesting platform for startup-investments. It is not a micro-financing site, but more one that allows people with a real demand for investing money the opportunity to participate in innovative conceots with low risk.

The model is based on "silent partnerships" (a well established legal form in Europe),  and the pricing/valuation will be done through an innovative auction mechanism.

The first auctions start at the end of October, and the first three profiles of participating ventures are online. Investing is possible with amounts starting from approx. Euro 2,000.

One of the first ventures in the Innovestment line-up is a mass customization project called Ludufactur. Drawing on the Germans’ fondness for board games (think of "Siedler"), Ludufactur will exclusively personalize many best-selling games using technologies like 3D modeling and printing (e.g. modeling a pawn after a fotograph), thereby mainly catering to the market for gifts.  Their website is not yet online, but a few promising examples can be viewed on their profile at innovestment.

So if this is successful, a new way also for other mass customization sites may be open!

More info at www.innovestment.de.

About the Author:

Frank T. Piller is a Co-Director of the MIT Smart Customization Group at the MIT Media Lab, Massachusetts Institute of Technology, USA, and a chair professor of management at the Technology & Innovation Management Group of RWTH Aachen University, Germany, one of Europe’s leading institutes of technology. Before entering his recent position in Aachen, he worked at the MIT Sloan School of Management (2004-2007) and has been an associate professor of management at TUM Business School, Technische Universitaet Muenchen. Frequently quoted in The New York Times, The Economist, and Business Week, amongst others, Frank is regarded as one of the leading experts on strategies for customer-centric value creation, like mass customization, personalization, and innovation co-creation. His recent analysis of the crowdsourcing business model “Threadless” (co-authored with Susumu Ogawa), an innovative crowdsourcing business model in the fashion industry, has been elected as one of the Top-20 articles in MIT Sloan Management Review.