The Wisdom of Crowds

June 22, 2010

I wonder if James Surowiecki thought that crowdsourcing was poised to become an internet hot topic when he wrote The Wisdom of Crowds. Whether or not he knew, his book certainly got to the strategic core of the why’s and how’s of the power of the crowd. I read that book in 2004 and I was simply passionate about it. I wanted to understand how to better harness the concept of aggregate thinking (not crowd thinking) to make better decisions.

Throwing money into the abyss?

I was quite excited when Kiva first opened its (virtual) doors. Kiva harnessed the power of storytelling, as well as ease of online payment, to help online individuals make a difference they felt connected to. I was equally excited when I watched the rise of crowdsourced funding in the startup world. I believe there is value in this. I know some people who argue that it’s just like buying a lottery ticket; you’re putting in money with no real chance at return. I like the idea, however, of supporting projects that I see as having social value but are not in the non-profit sector.

Small money to big money

So I gave money to Diaspora, the damn-the-man Facebook rival that got some attention this spring. A small part of me wanted the t-shirt that came at the $25 donation level so I could sport it like an indie band shirt. A large part of me was simply excited by the fresh-thinking college boys who were going up against a giant. At $25, I wasn’t in for much, so I¬†committed. It turns out that 6,478 other people felt the same way. The project came it at 2006% of its original goal.

Let the crowd decide

Diaspora utilized Kickstarter, a website that allows startups to raise funding through micro-payments. Here’s why I think Kickstarter has it right: The model is set up so that, if a startup hits its goal, donors are charged. If it doesn’t hit its goal, the assumption is that the idea isn’t strong enough to fund, and no donors are charged. Neat. It takes the wisdom of the crowd and applies it to projects.

So now this idea is hitting public radio. Why is this so incredibly cool? Because individuals can pitch stories, multiple individuals can provide funding, and then a professional produces it. Many ideas are pitched, only the good ones get funded, and we all enjoy a better public radio. To me, this is huge incentive to fund. I’d certainly prefer to give money for a story than to give money for an NPR tote bag.

About Room 214

Room 214 is a social media agency focused on social media and digital marketing solutions for iconic brands. Our services include business intelligence, social strategy, application development and video production.

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