SWIFT Design Group helps entrepreneurs take their start-ups to the next level. Often the primary fear of our clients with innovative new products is: how will they be able to compete with wealthier copy cat competitors after their innovative product is introduced to market. Lacking a satisfactory answer, they delay on coming to market at all, ensuring that they never lose the market, by never creating the market in the first place. This kind of procrastination is not driven by laziness, but by fear. But procrastination still threatens their future.
But FEAR = False Expectations Appearing Real.
How secrecy can doom your start-up to everlasting purgatory
As a result of their fears, one of our clients had filed a 3 patent applications and waited 3 years for them to issue, before asking our help to build a company that would write software that could take advantage of them. And yet, even with issued patents — which means the technology has been published online by the US Patent and Trademark Office for everyone to see — our client refused to allow us to contract with anyone to develop the technology until we could raise over a half million dollars in investment.
The problem is that venture investors don’t invest in a ideas — they invest in a team – a team that is able to create measurable business objectives and achieve them. For the investor, the test of how good an idea isn’t dependent on how difficult the science is, etc. The measure of how good the idea is how well the team is able to exploit it to achieve business objectives they promised they would reach.
Unfortunately it is hard to achieve any significant objectives without involving other people. But if at each meeting with investors all you can say is that you haven’t achieved any of your objectives because you are still looking or money, all you confirm for them is that you are a team that can’t get things done — and not a “can do” team worth an investment.
Try as we might, we could not convince our client to let us contract with people who could develop the applications or the market. But without progress on either of those two fronts we were unable to recruit the investors he sought, and neither of us achieved the goals we had set for the engagement.
Secrecy has it’s place in business, and when you are the 600 lb gorilla in the market, all eyes are watching to see where you’ll step next, But the stakes are different for start-up companies. The tradeoffs are different, in most cases, you’ll lose more by keeping secrets rather than you’ll gain by including more people in your idea.
Consider for a moment, you’ve got the idea that turns you on about your business. Lets says that someone tells you about another start-up, with a different idea than you. Would you give up on your idea and try to steal theirs. Most likely not. There are things about your idea that make it more appealing to you than most. And your background makes you uniquely qualified to pursue it. This is the reason you can feel free to discuss your idea with others entrepreneurs.
But what about big companies don’t you have to worry they will steal your idea?
In most cases, by artfully positioning yourself, you can make choices that will protect you from them as well. And this will be the focus of our next post.
Upaya Services would like to thank Scott McGregor of SWIFT Design Group for his guest blog!