The Big Idea
A handful of entrepreneurs are building marketplaces designed to hook up creative thinkers with businesses that need them. Is the world ready for an eBay of ideas?
Anyone who has spent time hunting for his glasses only to discover them on the bridge of his nose can relate to Sanjay Goel's feelings when he finally came up with the business idea for which he had been searching for half a year. The idea was this: to build a Web site for ideas.
Ideas are now widely regarded as the lifeblood of the economy. By some measures the market for the transfer of intellectual property has hit $100 billion. Increasingly, organizations are looking outside the ranks of employees to find these ideas. Last year, for example, mining company Goldcorp Inc. offered a total of $500,000 for the best ideas for getting 6 million ounces of gold out from under a lake in Ontario. The incentive paid off so well that the Canadian company upped the ante in March, offering a total of $2 million for other stellar gold-mining ideas. You can't even say it's not rocket science: NASA recently called on the world at large to come up with a scheme for launching a probe to Pluto for less than $500 million, having scrapped its own, more expensive plans.
Meanwhile, hundreds of thousands, and possibly millions, of people routinely generate ideas that could conceivably make someone a lot of money or otherwise improve the lot of some subset of humankind, but they're clueless about what to do with them. Send them uninvited to a company? Call a patent lawyer? Hire an intellectual-property agent? Start a company? Take out an ad? All are avenues conventionally taken by those imaginative thinkers who don't simply let their ideas die on the vine. But maybe a better notion is to bring the Internet's aggre- gating capabilities to bear on idea matchmaking, in much the same way that eBay has brought together buyers and sellers of collectible goods.
And so it was that the company Goel and Sharat Singh founded, called Ideas.com, along with a small pack of competing Web sites, intended to pull in orphaned ideas and funnel them to businesses willing to pay cold, hard cash for the best of them. "We're creating a marketplace of ideas," says Goel. "The ideas that are now being wasted are extremely valuable to companies."
Trafficking in ideas, of course, entails complexities that Beanie Baby traders never had to worry about, including the daunting difficulties in determining and valuing ownership of ideas. But, as with so many dot-coms, the biggest barrier faced by Ideas.com and its competitors has been having to struggle with unproved revenue models in an investment market that has turned its back on Internet companies unlikely to turn a quick profit. Indeed, time may have run out on Ideas.com. On July 31, Goel and Singh were seriously considering shutting down the company. But in bringing his company as far as he did, Goel managed to raise a question that may continue to beguile companies and individuals for years to come: can the Internet help transport ideas across organizational boundaries and in doing so render obsolete the entire notion of corporate boundaries?
HIDDEN JEWELS: "The ideas that are now being wasted are extremely valuable to companies," says Sanjay Goel, founder of Ideas.com.
Sanjay Goel was born in Delhi, India, to parents who expected him to become an engineer or a doctor. But Goel was fascinated with business and by age 12 had cofounded a thriving neighborhood magazine-rental stand. He dutifully trudged off to the Indian Institute of Technology in 1984, where he studied electrical engineering and secretly planned to start a business when he graduated. But, like many of his classmates, he felt obligated to first grab a master's degree in the United States, and he ventured to UCLA.
After a stint as a robotics researcher in Japan, Goel returned to California in 1990 and reinvented himself as a programmer specializing in finance. "I had zero background," he says. "My whole thing is I'd rather fail doing something very ambitious than succeed doing something that's not ambitious." After a year of programming, Goel decided it was Wall Street or bust, so he loaded up his aging Honda Civic and headed cross-country.
In New York City he had several interviews, to no avail. His credit cards were maxed out, so Goel decided he'd drive a taxi to make ends meet -- only to learn that a taxi driver's license would cost $300 -- $290 more than he had. Still, he wouldn't budge from his goal. "I'm either going to do what I want or nothing," he says. "There's nothing in the middle." He was counting his change to see if he had enough money for a meal when Citibank called and offered him a position in its investment-banking division.
By 1998 Goel had already been named the division's managing director -- a career rise of unheard-of velocity in the staid world of big-time investment banking. Despite the success and his indulgence in on-the-edge hobbies -- he carried his parachute with him on business trips, began flying airplanes and helicopters, climbed Mount McKinley, and started motorcycling and windsurfing -- Goel became increasingly restless. In 1999 he realized that, for all his daring exploits, he had been keeping his back turned on the biggest adventure of all: building a company from scratch.
Goel came up with a sensible course of action: develop a business plan, get funding, and then resign from his position. He then promptly rejected his own advice and quit on the spot. "It had to be a clean break," he says. "I have enough confidence in myself to know that for the second time in my life I was going to restart my career."
Goel had already come up with what he thought was a golden business idea: an innovation marketplace. Now he had to figure out how to make such a thing work. He took to spending his days at the New York University Law Library, reading about innovation. "The books were telling me that companies understand the value of innovation, but that they haven't found an optimal way to deal with it," he says. But what sort of business could close that gap? For months Goel researched the problem and couldn't nail down an answer. Then, as if in tribute to the adventitious nature of idea generation, the solution came to him in his sleep. "I woke up and said, 'Now I'm ready for this," he recalls.
