Crowdsourced hardware maker Quirky ditches device manufacturing, is close to raising a new round of funding
Exclusive: Quirky ditches device manufacturing, preps for new investment — Quirky is just days away from raising a new round of venture capital funding, Fortune has learned …
Context & Ripple Effects
Quirky's February pitch was speed: a crowdsourcing model that promised to bring hardware products to market faster than traditional R&D. By April, the Verge's accounting showed the cost side of that promise — money-losing inventions pushed through production and a third of staff cut. Today's Fortune report is the strategic response: Quirky exits device manufacturing entirely while telling investors it is days from a new venture round, converting itself from a factory-backed product company into something closer to an invention-licensing shop.
The pivot did not hold. Months later Quirky filed for Chapter 11, selling off its Wink smart home platform to Flextronics for $15M, and the relaunched company of 2017 kept only the licensing focus. The through-line matters because the buyers kept coming back to the idea without the factories — GE Appliances' Haier-owned Giddy spinout in 2018 is a corporate re-attempt at the same crowdsourced development model.
First-order effects
- A new round raised under these terms would be funding an asset-light licensing business, not a manufacturer — investors are being asked to price Quirky's community and IP pipeline, not its inventory risk.
Second-order effects
- Exiting manufacturing makes Quirky's operating assets separable, which is exactly how the Wink smart home platform ended up as a discrete sale to Flextronics rather than part of any rescue of the whole company.
Third-order effects
- If the pattern holds, crowdsourced product development survives only decoupled from production: the community-and-IP layer gets funded or acquired (GE's Giddy), while the manufacturing layer gets discarded or sold — a structural split between invention sourcing and physical execution.
The trend: Crowdsourced hardware platforms are retreating from owning production toward licensing models, with their manufacturing assets carved off and their development pipelines absorbed by larger appliance and consumer-electronics players.