So many of us start the new year bursting with new product and business ideas.
Yet, after asking my personal network if they’d share their ideas publicly, one question kept coming up: How will I protect my idea from being stolen?
Why does everyone think their ideas will be stolen?
I’ve spent hours researching this online, asking:
The results were a bit of a mixed bag, but as I dug deeper patterns began to emerge.
If your business idea is in its infancy, or you’re in the process of looking for funding, here are some insights I’ve discovered on how (and when) to hold your ideas close toy our chest.
The first thing I discovered when researching idea theft is a slew of blog posts from tech entrepreneurs, investors, and venture capitalists, all shouting how unimportant your idea is.
Entrepreneur Penelope Trunk said to get over yourself. If someone steals your idea, let them. Take it as a compliment.
While venture capitalist Paul Graham said that people overvalue ideas:
“Actually, startup ideas are not million dollar ideas, and here’s an experiment you can try to prove it: just try to sell one… The fact that there’s no market for startup ideas suggests there’s no demand. Which means, in the narrow sense of the word, that startup ideas are worthless.”
Linguist David Rosson, one of Quora’s most read writers, became so annoyed that he posted:
“Since this topic comes up so often in the feeds, I feel it’s time for someone with a few spare hours (and skill) to put up a website called stealmyidea.com where non-fussed creative people can post their ideas for free and other people can like or upvote them to show how much f*** they give.”
I’ll save you the tab. There’s nothing at stealmyidea.com.
The popular opinion is that your idea is worthless. It’s how you make those ideas happen that matters.
David Sivers, founder of CD Baby, the largest seller of independent music online, says he doesn’t want to hear about any idea until execution has taken place. In fact, he went so far as to say:
“The most brilliant idea, with no execution, is worth $20. The most brilliant idea takes great execution to be worth $20,000,000.”
Execution is what makes the greatest difference between successful people and idea-squatters. Ramit Sethi, author of I Will Teach You to Be Rich, calls it the Myth of the Great Idea: success comes from doing, not from a great idea.
Yet there must still be examples of ideas being stolen to the detriment of the original inventor (or at least, someone who believes they were the originator). I wanted to see how often this actually happens by targeting hard data—the stories and accounts of real ideas being stolen and executed on—and seeing what the outcomes were.
Silicon Valley serial entrepreneur Steve Blank wrote about his experience of having his startup idea stolen by someone posing as a potential customer. The ‘thief’ allegedly took a hard copy of Steve’s slide deck, slapped a different logo on it, and raised a seed round.
He even scheduled his launch a day before Steve’s company could.
Yet despite the potential negative outcomes, Steve realized that it wasn’t just his idea that was valuable, but the entire process of taking it from idea to final product:
“Our competitor was executing on hypotheses we had developed 9 months ago and their strategy remained static. We on the other hand, had moved on. We had discovered detailed information about what customers really needed and wanted and turned our original hypotheses into facts.
We had validated our new assumptions by a set of orders, and we had pivoted our business model. Our original idea had been nothing more than an untested set of hypotheses. Truth be told, we were no longer the company in those stolen slides.”
The competitor eventually shut down after a few months.
Timo Rein, president and co-founder of Pipedrive, a sales pipeline management software, had his company idea copied pixel-for-pixel by one of his customers in another country. The software, UX, design, and large parts of the front-end code were copied exactly. Even the local domain was bought, redirecting to the competitor’s site.
Instead of pursuing legal action, Timo reached out to one of their investors who had strong ties in the ‘thief’s’ country, who wrote a scathing Facebook post pointing out the similarities. The competitor denied any wrongdoings (of course), but still made several concessions.
Rein said: “Looking back, signups from that country have not slowed down, and the only tangible loss is our relevant domain.”
His advice to people who have their startup ideas stolen:
“Get back to work and try not to worry about it too much. Swearing also helps, but is not critical.”
Both of these stories seem to reinforce that ideas are worthless and action makes the difference.
If your idea gets stolen, just work harder, right?
But what happens when it’s not so much of a theft, but rather (as is most the case), a ‘borrowing’ of ideas?
Inspiration can strike at any time, especially when someone gives you something worth working on.
One of the most famous and known stories of ‘idea borrowing’ is that of the Winklevoss Twins—a pair of idea-guys without any technical expertise. Needing programmatic talent, they found Mark Zuckerburg to build their idea for a Harvard social network.
While working on the twins’ project, Zuckerberg ‘got’ the idea for Facebook and delayed sending updates to the twins until he launched thefacebook.com. The twins sued Zuckerberg for stealing their idea, but lost the case, settling for only $160 million.
From these stories (and a few more I omitted), I found two lessons about how ideas are most likely to be stolen:
Ideas are most likely to be stolen from someone with competency in the field. The risk is in the details. If you reveal all your work to someone who fully understands and has the skill to create your vision, then your idea may be at risk.
Ideas are most likely to be stolen when action has already taken place—there is a vision and plan on paper. Several examples showed ideas being stolen when a plan-of-action, proof-of-concept, and research were attached to it. If you give someone a treasure map don’t be mad when they follow it.
With the risk established, the question now becomes: to share or not to share?
Maybe there’s a middle ground we can find. A safe place where you can get feedback and input on your idea without the risk of it being stolen. On the path from mere thought to executed idea, where should you share?
From my research, the safest place to share your idea is closer to the beginning stages, before the meat of the work takes place.
Sharing is okay at this stage because your idea is still unproven and impulsive.It truly is ‘worthless’ in the sense that it’s unresearched, un-Googled, and unwritten.
In your head it may be worth $1b, but in reality? You won’t even get a cup of coffee for it.
These impulses need to come out. Write your idea down on paper so you can communicate it succinctly. Then, search the Internet to see if it already exists. You want to find something similar but not exact.
If you find absolutely nothing, be careful. This could be a red flag that you’ve found a dead market with little to no buyers. Ideally you’ll find something similar but that’s lacking in a key way. You want something you know you can do better.
Now, once you have a clear, concise idea that has passed the research phase, you can share it with your personal networks. You’ve put little to no work into it, it’s not making any money, and it has no physical design. There’s no proof that this is a viable business idea so go ahead and share the heck out of it.
As you let it out of the box you’ll receive feedback, which will either fan the flame or douse the fire. If it douses the fire, then consider yourself saving years of time, energy, and cash. If it fans the flame, then move on to the planning stage.
As you build out your business plan, your idea will become more and more real.
If you are a non-technical founder, the time will come when you need to find someone to build your product, like a manufacturer or programmer.
At this point, things change once again. Your idea is now vetted and solid, meaning that it’s at risk of being snatched.
Here are a few ways to share your ideas with potential makers without exposing yourself to too much risk:
As your business develops you might reach the point where you need to bring in some extra cash through courting investors. At this point you’re in the danger zone of having a solid, executable idea without any real protection or credibility.
Again, how you share your idea will change. Here are tips for sharing your pitch deck with investors:
“My suggestion is don’t worry about your idea being stolen by the VC, but make sure you either are OK with any collateral or materials you give them being forwarded on to your competitor — or if you aren’t, try to encrypt PDF copies in some format (e.g. a simple password) that inhibits a basic email forward. That’s at least a basic if not fundamental protection. A better option is to forward on materials as a link to a limited-access Google Doc or something similar where you can later cancel access rights.”
In the end, there’s no real, bulletproof way to stop someone from copying your idea. And the closer you get to making your product a reality, the more risk there is that someone will co-opt your hard work.
This is the nature of a free market economy. Competition ultimately serves the customer best. So how do you protect yourself from copycats after execution?
Hustle. Action. Bury the competition.
There will always be the fear that someone will take your idea. Heck, there’s even documented stories of ideas being stolen with no consequences. So why share your idea at all until you’re ready?
Ultimately, your idea is your idea. Only you can execute on it in the way that you will.
Stolen ideas are just plans. And as Jason Fried, founder of Basecamp says:
“Let’s just call plans what they are: guesses”
Share your plans freely, but when it comes time to turn them into a reality, keep your cards close to your chest.
To sum it all up, remember this:
Share your whims, not your decks.
Dave Schools is a writer and entrepreneur. His latest idea, Business Brewers, helps the startup community share whims (over coffee and beer) through the mobile Brew app and the Brew Book journal. Sign up to become a Business Brewer or tweet him to find out more.