Innovations stemming from tiny markets can have huge effects. Dartmouth's Vijay Govindarajan made what's called "edge" innovation famous in a 2009 study outlining General Electric's need to look to developing world for simple medical innovations to bring to the United States. Today, innovators look to small businesses and entrepreneurs that find success in niche markets for better ways to solve problems on a larger scale. "Edge conditions, whether in Brooklyn or India, can be right outside your front door," says Fred Dust, head of IDEO's System at Scale. "And their solutions can change how the masses do business." Here's a look at a few small businesses on the edge and how they are making waves in big ways.
When Brooklyn doctor Jay Parkinson didn't want to deal with all the headaches of starting a private practice, he put his schedule on Google Calendars, advertised that he would do neighborhood-only house calls, and let patients pay via PayPal. He soon conquered his market, and the idea spawned a larger company called HelloHealth, which helps other doctors do that same thing—nationwide. "This is a story of innovation on the edge that is fundamentally changing the way an industry is working, and I love that he used big-company mass technology to do it," Dust says.
Non-profit IAVA provides veteran services structured around social media. It was started in 2004 by soldier named Paul Rieckhoff, who was returning from serving in Iraq. He found that the U.S. vet services weren't relating to him the way he related to his fellow returning troops, which was primarily through social media. Now large companies, from banks to donation services, are looking to partner with IAVA. "This company is getting a lot of attention because it's working," says Dust. "Say you have a vet going back to a rural town of 500 people, social media becomes a very powerful tool to reach that person."
Founded in 2001, Voxiva has recently adopted a simple concept more often seen in the third world: Using text messages to relay information. One of its U.S. services, Text4baby, uses text messages to educate pregnant women about what prenatal care they may need. The company uses the same technology to help people quit smoking with a service called Text2quit. "The idea here was that this technology is working wonders in smaller countries," says Dust. "Why not use it here?"
Launched in 2009 by serial entrepreneur Ben Kaufman, Quirky is a social online platform to connect inventors with developers, manufacturers, and investors. The company has successfully facilitated the creation of thousands of products and now has earned corporate America's attention. Some of the products created using this platform, such as iPod cases and electronic accessories, have been featured on HSN and even national retailer Bed, Bath, and Beyond.
Started in China as a simple manufacturer of affordable appliances such as refrigerators, Haier is now a major global player. "For example, every air conditioner at Dartmouth is an Haier because it is inexpensive but reliable," says Govindarajan. "This company found a way to do it better, and other countries responded." Haier is now a billion-dollar company that serves North America, Asia, and Europe.
In 1969, Brazil was not exactly a dominating force in the global economy, says Govindarajan. But a small aviation company called Embraer launched and eventually got the world's attention by manufacturing quality aircrafts in niche fields, such as agricultural aviation and defense planes. Today, the company is one of the world's largest aircraft manufacturers, with planes of up to 120 seats covering five continents. —Nicole Carter