Good advice from crowdfunding site Seedrs on whether it’s worth trying to protect your idea.
At this early stage in its corporate life, with only a few bars on its platform, and a user base in the hundreds, Flowtab spent and invested scarce resources into something that would eventually yield it nothing.
You can’t, but confidentiality is the last thing a new startup should be worrying about. Sharing your idea is critical to raising funds, attracting collaborators and building your product. What about the risk that someone steals the idea in the process? Well, Eric Ries provides a very clear answer to this in The Lean Startup:
“The most common objection I have heard over the years to building a minimum viable product is fear of competitors – especially large established companies – stealing a startup’s idea. If only it were so easy to have a good idea stolen! Part of the special challenge of being a startup is the near impossibility of having your idea, company or product be noticed by anyone, let alone a competitor.
“In fact, I have often given entrepreneurs fearful of this issue the following assignment: take one of your ideas, find the name of the relevant product manager at an established company who has responsibility for that area, and try to get them to steal your idea. Call them up, write them a memo, send them a press release – go ahead, try it!
“The truth is that most managers in most companies are already overwhelmed with good ideas.Their challenge lies in prioritization and execution, and it is those challenges that gives a startup hope of surviving. If a competitor can out-execute a startup once the idea is known, the startup is doomed anyway…”
A notion reinforced by the example of bar ordering app Flowtab on the time they wasted on patent protection, which is one reason they failed eventually:
“You want to protect your IP, right? Well, maybe not. Flowtab filed a patent concerning the “ability for merchant sellers and servers in hospitality establishments to use point-of-sale applications to send one-click/one-touch order-status notifications to mobile devices of their customers.” It wasn’t a good move.
“Looking back, founders Hill and Townsend describe the effort as a waste of time, and a drain on their finances. It burned “lots of energy” and yielded nothing more than an “investor talking point,” they told me. Hill explained that the largest “value that [Flowtab] got out of the patent was convincing investors that it actually meant something.”