Lovely article in the New York Times business section on Sunday. Rite-Solutions, a software company, has built an internal marketplace to allow everyone in the company to invest in good ideas.
At Rite-Solutions, the architecture of participation is both businesslike and playful. Fifty-five stocks are listed on the company’s internal market, which is called Mutual Fun. Each stock comes with a detailed description — called an expect-us, as opposed to a prospectus — and begins trading at a price of $10. Every employee gets $10,000 in “opinion money” to allocate among the offerings, and employees signal their enthusiasm by investing in a stock and, better yet, volunteering to work on the project. Volunteers share in the proceeds, in the form of real money, if the stock becomes a product or delivers savings.
This intrigues me both for its democracy and for the discipline of requiring people with ideas to write a clear, easy-to-read description of their project.
“We’re the founders, but we’re far from the smartest people here,” Mr. Lavoie, the chief executive, said during an interview at Rite-Solutions’ headquarters outside Newport, R.I. “At most companies, especially technology companies, the most brilliant insights tend to come from people other than senior management. So we created a marketplace to harvest collective genius.”
Great ideas are equally possible coming from the bottom up as the top down. In particular, those “bottom” people have a lot of hands on experience with the way things actually work.
“There’s nothing wrong with experience,” said Mr. Marino, the company’s president. “The problem is when experience gets in the way of innovation. As founders, the one thing we know is that we don’t know all the answers.”
I’ve worked at companies where a senior executive is vigorously pursuing an idea that most people know is doomed. No one person is willing to share the bad news, but what if he or she had to confront a slumping share price for their “expect-us”?