When an entrepreneur develops an innovative idea, the risk of idea theft can be troubling. Use this article to learn how you can keep an idea safe from competitors and other threats.
Many entrepreneurs share the same fear: that someone else might steal their idea for the next big invention.
Imagine the moment when you see that someone has founded a company on a concept that was actually yours. In addition to financial losses, experiencing idea theft can be emotionally devastating.
You can use this article to learn how to determine if your idea was stolen by a competitor and how to protect yourself from idea theft in the future.
Idea Theft Takes Many Forms
Many entrepreneurs, venture capitalists, and influencers claim that people overvalue ideas and even encourage people to pitch their ideas for free. There are many case studies, however, where famous business ideas were stolen.
In general, these instances fall into two categories: theft of concepts, and theft of visual design and branding.
Steve Blank, a well-known entrepreneur and author, claims that he has been a victim of idea theft twice during his career, specifically related to business concepts.
During the first instance, Blank was launching his own video company. While in Japan for the business, he alleges that he saw his Japanese client presenting slides that were actually his.
On another occasion, Blank presented an idea to the vice president of a reputed company. Later, Blank alleges that the same vice president used his slides to to raise his own funds.
In addition to the theft of concepts, another common form of idea theft is when visual design and branding are copied or stolen.
For example, the visual design of Pipedrive, a sales pipeline management software, was ripped off point-to-point by another company.
The other company’s interface is nearly identical to Pipedrive’s interface. The only difference is that Pipedrive uses a grey background, while the website that copied it used a black background. Even the fonts are pretty similar.
Idea theft happens often enough that entrepreneurs must take steps to protect themselves.
How to Protect Yourself From Idea Theft
There is an age-old saying: Prevention is better than cure.
Instead of having regrets later, it’s better to take precautionary measures to protect your ideas.
You should take 4 key steps to protect your ideas:
- Learn when to share your ideas.
- Require a non-disclosure agreement.
- Limit what information you share.
- Keep a written record of all conversations.
Step 1: Learn When to Share Your Ideas
To ensure that your idea won’t be stolen, you should only share ideas that are in an early stage. Avoid sharing ideas that are close to execution.
The risk of idea theft increases when:
- You share every detail about your idea
- You share information with someone who has enough expertise and resources to execute your idea
- You write down your vision, plan, proof-of-concept, and layout but fail to store them securely
To minimize the risk of idea theft, you should wait to share information about your idea until you’re ready to receive formal feedback. In this phase, others can help you identify weak points or potential challenges, but you won’t need to reveal the solutions that will make your idea novel or profitable.
If you’re wondering how to ask for feedback without actually revealing your business idea, you can use a simple customer feedback framework and suggestions for how to take action on feedback by David Cancel, the CEO of Drift, a B2B marketing platform.
By learning when to share information and when to hold back, you can decrease the chance that your idea will be stolen.
Step 2: Require a Non-Disclosure Agreement
You should require anyone with access to your idea to sign a non-disclosure agreement (NDA).
An NDA is a formal agreement that prevents someone from sharing your idea with anyone else. If someone violates your NDA, you can take legal action against him or her.
You can find boilerplate for a standard NDA online:
You should also contact a lawyer who can help you set the specific terms of your NDA.
Blank says that his biggest regret was viewing NDAs as an impediment rather than protection against theft. Had Blank obtained a signed NDA, he would have had the option of taking legal action against the person he accused of stealing his idea.
An NDA gives you the option of taking legal action if your idea is stolen, which discourages theft.
Step 3: Limit What Information You Share
Many entrepreneurs share too many details about their ideas. Often, they think that explaining compelling details about the idea will convince others to invest in it.
However, this greatly increases the risk of theft. Instead, you should only discuss the most persuasive aspects of your ideas with investors – not every detail about how you plan to execute your strategy.
Examples of information you should refrain from sharing include:
- The core concept of your business idea
- Your blueprint
- The business model
Instead, focus on sharing:
- Your vision
- How your idea will benefit people
- What change your idea can bring to society
As an entrepreneur, you need to sell people dreams – but don’t tell how to achieve them, since that’s what your business will do once it launches.
By keeping these guidelines in mind, you can protect your idea.
Step 4: Keep Everything in Writing
Entrepreneurs should keep a written and dated record of everything. If you don’t keep a record of your conversations, you won’t have any proof if you later suspect someone of stealing your idea.
As you pitch your idea to potential collaborators or investors, you should keep a written record of your:
- Plan of action
- Vision for the project
- Conversations with anyone you hire to build out your idea
- Feedback on the idea
You should also keep track of how your idea changes over time.
Additionally, you must password protect these notes so that no one can access them without your permission. In iOS, there is a simple method for doing so.
Careful note-taking will allow you to build a record of how your idea developed, and how you shared it – preventing you from doubting your memory of events. Storing these notes securely will ensure that no one can access or tamper with them.
All Entrepreneurs Should Limit the Risk of Idea Theft
Idea theft doesn’t exist in novels and movies alone. In fact, incidents of idea theft are real and can have devastating impact on entrepreneurs.
Tactics, such as knowing when to share information, limiting what information you share, and keeping written documentation, can all reduce the risk that your idea will be stolen.
Finally, in the event that your idea is stolen, requiring NDAs will ensure that you have the legal protection necessary to take action.
About the Author
Neeraj Sharma is an avid reader and writer with an undying passion for making people aware of the latest tech with his blogs. He has written a myriad of articles related to tech, apps, games, social media, and entrepreneurship. At present, Neeraj is contributing articles on applify.co.