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Beyond the balance sheet

How to protect your idea for a business

Ercan Demiralay 29/11/2019 5 minute read

Ercan Demiralay FCCA writes about the necessary steps to take to ensure your business ideas are less at risk of being stolen.

You've had a lightbulb moment and gone through all the excitement of brainstorming an idea, and then... its lost!

In a society characterized by connectivity, it is no surprise that business ideas are stolen, both accidentally and intentionally. This can happen inside the workplace or even among trusted friends and family, either way, it can be crippling to both the young and seasoned entrepreneur.

In this post we look at how to protect your idea for a business through careful planning. We also explore ways to respond should your concept be swiped.

How to test your business ideas to see if they will work

Prevention is better than cure! Plan and protect yourself

Better to prepare and protect than react after the event right? Safeguards you can put in place include trademarks, patents, or copyrights. By using any three of these, you arm yourself with sufficient ways to fight against those that may be looking to steal your concept.

Though none will guarantee complete safety, they will act as a security net in case your idea is stolen. In the case of patents they also come with potential tax benefits in the form of the patent box.

Unfortunately getting these things in place can be quite a long, legal process. So what are you to do while waiting on the approval of a patent which can potentially take years? The reality is that to turn your ideas or vision into a viable business will often require the help of others but thankfully the following tools can help protect your intellectual property:

 

1. Non-compete agreement 

Have your employees sign a non-compete agreement whereby they are prevented from starting a business that would compete or threaten yours within a specific area or boundary.

 

2. Non-disclosure agreement (NDA)

If anyone works with you on your idea, service or product then you can get them to sign a non-disclosure agreement whereby they are bound by confidentiality. This prevents them from sharing any relevant information with third parties, it doesn't have to be one way either, you might also get it to apply to you which could help put them at ease. Be wary of an expiry date, not having one might just be preferable.

 

3. Work-for-hire agreement

If you hire someone to help enhance your product, be sure to have it in writing that all improvements are owned by you. That way any further ideas they come up with will still come under your ownership. You may need to detail that person as a co-inventor in any patent, but they won't have any ownership rights.

What if you're a victim? Stay calm and get to know the situation

If you haven't got any of the above in place, stay away from immediately confronting the person or group of people that have adopted your idea as their own. After a couple of hours, many suggest calmly sending an email to the necessary persons discussing the issue at hand.

Sometimes they will have unknowingly taken your idea and thus the problem can be resolved. If that is not the case, this can be a fruitless effort and thus legal steps may be required. While the latter is an available option, it will cost not only money but precious time, two resources that are often somewhat limited to the modern day entrepreneur.

Depending on the circumstances, this might be necessary, but weigh the options up carefully.

Learn from the experience

Sure, there are people who knowingly go about stealing business ideas. However, in some instances it's accidental. As ideas are talked about a lot, they become familiar and it is easy to forget that an idea belongs to a specific person.

What can we learn from this? In some ways talking less about your idea may be the surest way to keep it safe. Though it is tempting to share your unique concept with anyone willing to listen, this might be a case where you share only with those you trust or those you're willing to invite into your idea. 

Ask yourself, have you've ever accidentally used a friend's idea as a kickstart for your own? Chances are that at one point you may have at least "borrowed" a bit of someone's concept without giving them full credit. We can now begin to view our idea's theft through a different lens, one that shifts responsibility onto not only the thief, but also ourselves.

Keep your idea?

Though your idea may now seem useless to you, this is far from the truth. The only thing that has been taken is the actual idea itself, not the actions or plans you were going to put it into place to establish a successful business.

As these 3 great business ideas demonstrate, having the vision (or even stealing it) is one matter but the execution into a successful business is entirely another. Because of this, there is no reason to permanently discard your concept.

Sure, your idea may now have a few more competitors than before. However, this could force you to innovate or differentiate in a highly effective manner. That in turn could help you eventually stifle any competition.

Alternatively, move on?

If you feel less passionate towards your vision should it be stolen, then move on and consider new ventures.

It might be discouraging to start over completely, but this may in turn produce a new concept or innovation that is more useful to a market and potential customer base. Not only this, but it's extremely easy to become comfortable with an old idea, that makes new concept generation/product development difficult.

With your old idea taken, you will not be tempted to put off innovation, but instead be forced to create new ones that trump the old.

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This post was created on 11/08/2017 and updated on 29/11/2019.

Please be aware that information provided by this blog is subject to regular legal and regulatory change. We recommend that you do not take any information held within our website or guides (eBooks) as a definitive guide to the law on the relevant matter being discussed. We suggest your course of action should be to seek legal or professional advice where necessary rather than relying on the content supplied by the author(s) of this blog.

 

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