Ercan Demiralay, Partner at Wellers, one of the UK’s leading accountancy firms, looks at why prevention is better than cure when it comes to protecting your business ideas and explains how to ensure they stay safe.
Perhaps it is a reflection on how easily connected we are nowadays, making us unguarded and more open than ever, but it no longer comes as a surprise to hear that the act of stealing business ideas occurs. No matter whether it happens intentionally or accidently, it can have a huge impact on even the most established of businesses.
So, how can businesses protect, plan, and respond?
In its most simplistic form, it is always better to be proactive and plan ahead, so that your business concept is protected, rather than react to a situation once it has happened. Playing catch up after the event is much harder than setting plans in motion when things are operating smoothly.
For those that want to follow the prevention line, there are some established ‘safety measures’ that can be put in place to stop business ideas being stolen, for example, trademarks, patents, and/or copyrights. If a business uses any of these solutions, they are in an incredibly strong position from which to fight against anyone looking to steal their concept.
However, the process of actually putting these measures in place can be lengthy, so in the meantime, I would suggest taking three steps to protect your intellectual property:
Non-compete agreement – It is important that you ask all employees to sign a non-compete contract. This prevents them from starting any business that might rival or impede yours.
Non-disclosure agreement – Similar to the non-compete, asking everyone who has worked/is working on your idea to sign an NDA is an absolute must. By doing this, they are bound by confidentiality, and are therefore not able to talk to third parties about your idea. Do be wary of an expiry date, because not having one might be preferable.
Work-for-hire agreement – If you have people helping you improve your idea or product, then make sure that you have it in writing that all improvements are owned by you. Doing
this means that any advancements that are made during their work will still come under your ownership.
Cure not prevention
I have discussed why prevention is better than cure, but in some instances you might not have been aware it was necessary, or never got around to doing it because you were so carried away with your fantastic idea. So, if no protection measures have been put in place and your idea is stolen, there are some important things to remember.
Firstly, do not confront the person/s involved. Wait for an hour or two, making sure you are thinking rationally about the situation. Thinking with your head over your heart in these situations will always have a more desired outcome. Then, calmly contact them and ask to discuss the issue in person.
At this stage, you might find that it has all been a simple mistake, in which case the problem can be resolved amicably. If it is not, then it is likely that legal steps will be required. Approaching the situation calmly makes the most business sense at this stage, because if the issue can be settled without involving third parties, it is a much cheaper and quicker option, which for many entrepreneurs is always a preferred route.
Once the dispute has been settled, in person or in court, there are three things that need to be considered – learn from the experience, keep your idea and then move on.
Learn from it – Put plans in place to stop it happening again in the future. This is fundamental, and is certainly a case of ‘fool me once, shame on you, fool me twice, shame on me’. Though it is incredibly tempting to share your concept with anyone willing to listen, it might be better to only share it with those you implicitly trust.
Useful idea – Although the process and concept may seem useless to you now, this isn’t the case. The only thing that has been taken is the actual idea itself, not the strategy or plans you were going to put it place in order to establish a successful business. Having the vision is only one part of creating a successful business, so keep your strategy and implementation to yourself for next time around.
Also, having your idea stolen does not mean you can’t launch it to market. It is still your creation, so you know it better than anyone else. Just make sure you are clear on how you are going to launch and ignore the disturbance that has taken place beforehand. You had
plans, stick to them, and innovate wherever possible to affirm your position as the leading product/service available.
Leave it – Your other option is to move on. If the process has left you feeling uninspired about the idea or less passionate about your initial vision, you can just walk away. Starting again isn’t for everyone, so don’t feel embarrassed if this is the avenue you take. Don’t give up though. You can start a new project, or find a different market to operate within, but don’t give up. The entrepreneurial spirit is not in everybody, so don’t waste your talents feeling sorry for yourself, pick yourself up and be an improved version second time around.
Stealing someone’s idea is underhand and unethical, but it does mean that someone thought your idea was worth taking. No matter if you are just starting out, looking to grow, or have had your idea stolen in the past, the same rules apply. Protect your concepts and plan against them being taken. If you have all the appropriate protocols and systems in place, it minimises the risk of them being taken, and helps you rest slightly easier at night.
For more information and insight into how to asses and implement your business idea visit: https://www.wellersaccountants.co.uk/blog/how-to-assess-and-implement-your-business-idea.