Ideo Just Sold Part of Itself to Join a 'Creative Collective'

Ideo, the big-name Silicon Valley design consultancy and propagator of "design thinking," has sold part of its business and joined the Kyu collective. Kyu is part of Tokyo's Hakuhodo DY Holdings, and includes other agencies like Sid Lee, Red Peak Group, and Digital Kitchen. The dollar value of the partial acquisition, and the fraction of Ideo's business that it constitutes, have not been made public.

In a post on Medium, Ideo's CEO Tim Brown explains:

The rate of change has been dizzying, and today’s advanced technologies — AI, genomics, robotics, data science, the Internet of Things — have so outpaced our industrial-era organizations and infrastructure, they end up hitting institutional cul-de-sacs. The technologies don’t come to a halt, of course, they simply move on, seeking out other places where they race ahead. If our institutions are to survive, they’ll have to create new roadways.

That’s a design problem — one that requires new rules of engagement with a broad set of collaborators. We’re excited to have found those collaborators in a few like-minded design firms.

In the same post, Brown quickly dismisses the idea that Ideo is "caught in the much ballyhooed death spiral of the independent design firm." Instead, he says the decision to sell a stake in Ideo's business and join a collective is part of a larger mission to "apply our collective design practice to greater challenges." Whatever the reason, the business deal fits the larger trend of big firms buying up smaller design studios. McKinsey bought Lunar; Yves Béhar sold a majority stake in fuseproject to the Chinese holding company BlueFocus. In many ways, these transitions aren't new. There's a long history of commingling between design and business (more on that here). Ideo is just the latest—and most high-profile—firm to make such a move.