DIY startups get funding

Source: VentureBeat

Companies that let customers design their own products are becoming the next big thing. Just three months ago, I wrote that this trend of “customer co-creation” was one to watch. But it may prove even hotter than I thought. Since publishing the story, I’ve seen quite a bit of new funding activity in the space.

Albert Wenger of Union Square Ventures:

“We’re pretty convinced that mass-market consumer products are now so cheap and widely available that they’ve lost a lot of their appeal. We think people are looking for something unique and customizable. We’re interested in the social fabric — bringing people together that design things, and people who want to buy them. Mass produced goods are dominated by a few large brands. But everywhere you look there are movements seeking to bypass those brands, whether it’s the locavore movement in food, or something such as NikeID, which has seen double-digit growth year over year.”

Mass customization ventures are attractive to VCs not just because they’re seeing tremendous growth. As it turns out, a scalable build-to-order supply chain model is also very cost-effective — sometimes even more so than a conventional mass production model. And because co-creation sites are seeing viral growth, they promise low customer-acquisition costs.

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