Investor pitch · Executive coaching

How to pitch an idea to employer execs without losing the ability to pursue it on my own?

Anonymous

July 23rd, 2015

I'm getting ready to pitch a white paper to some senior directors and VP level execs at a major tech company I currently work for (as a FTE). This is something I WANT to do, even if they choose not to pursue it. I'm probably going to be asking them to spend something on the order of 20-60 million to acquire an existing company as a development lab to solve specific issues.

The company is not a development lab, but a (sometimes) profitable company in a space that our company is not directly involved in (small data center environment), but closely related to work that our company is big in (large data center environment.) The company is not a development lab, but is working on a solution to problems that we have in common and are able to address the issues more agilely than we are (startup environment at small scale vs. big corporation politics and large scale multinational deployments.)

I'm looking for advice on how to pitch something to my existing management without losing the ability to pursue it later on my own if they reject it. Me doing this on my own will likely look like starting engineering on the solution from scratch and pursuing seed capital in parallel to engineering work and trying to build a team.

My concern is that by presenting to my employers executives, that I will give up rights to work the idea on my own. I suspect that there is a simple solution to this, such as leading with a statement that essentially says, "I'm doing this whether you are in or not.", but don't want to give an ultimatum or appear that heavy handed.

Am I right to be concerned about this?
How do I work around it?
Anyone ever pitched an idea to their employer like this and then launched the idea on their own?
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Rob Underwood Advisor and Entrepreneur

July 23rd, 2015

When I was with Deloitte and KPMG/BearingPoint I did a lot of work with big tech companies. It's very likely that there is a clause in your contract that says that all work and invention done during your employment becomes your employer's IP. I would be very wary of what you're proposing. If you really feel like this is a great idea and something you'd like to keep the option of doing outside (i.e., after) your employment, I'd strongly suggest you spend the money and review the idea and your employment contract with a lawyer. 

What might happen is they reject it, you leave, you build it, it's a wild success, and they come and ask for it back. There was a whole story line of "Silicon Valley" that, while not exactly identical, explored a similar situation. 

Definitely do not trust anyone at your employer who verbally tells you "it'll be ok."

Talk to a lawyer. Be very careful here. 

Michael Barnathan

July 23rd, 2015

This depends on your employment agreement. If they invest money in it, they'll probably consider it a work for hire. If they don't invest in it, they might *still* consider it theirs if it's within the scope of your IP transfer agreement with them. Make sure it's clear that it was all on your own time with your own resources, and check your agreement to see whether they'd own it anyway before proceeding. If it isn't in the scope of the agreement and isn't interfering with your job, whether you persue it in your own time shouldn't be something they can limit anyway.

EM

July 23rd, 2015

Lots of good advice on the employment law side (i.e. get professional advice and read your employment agreement).

On another note, instead of pitching your idea, you should present a range of different solutions to the problem being solved:
a) acquire the small data center company
b) dedicate an internal to team build it
c) they seed fund you and be your first customer
d) pay a development shop to build it

That way, you might get your seed money + your first customer and, if nothing else, you'll get a sense for what your company execs think of the idea.

Bill Wittmeyer CEO Electronic Sensor Technology INC

July 23rd, 2015

You should check your employment agreement.  You may have signed an invention and non-disclosure agreement upon being hired that can be understood as giving the company the rights to your idea.   Get legal advice before disclosing your idea your employer or to investors.  

John Seiffer Business Advisor to growing companies

July 23rd, 2015

I agree with Ron Underwood. If they reject the idea, you can ask their permission to pursue it on your own. It's a long shot but if the company really feels it's out of their comfort zone and they're OK losing you they might agree. If so be EXTRA SURE you have a lawyer who's got experience in this field write the agreement for you and review any changes they want to make. 

Dan Oblinger Founder at AnalyticsFire

July 26th, 2015

Ashwin,

I agree with Eoin.  If you have not done so you NEED to talk w. your lawyer before you say anything about this idea.  You contract will say something about the IP you product during this time.  I have been in exactly your position, and it may be that all related IP you produce is owned by them, or only IP you deliver, etc.  you need to understand what actions on your part cause them to own the IP.   

Quite possibly once they can prove you produced it while in their employ, they own it.  in that case you are risking never being able to do it, if you present it.

IF you can present it w/o them owning it, then I think there is little reason to be heavy handed when presenting it.  Simply say  "this is a great idea, and I definitely want to do it."   Later if they fail to make motion on the idea, you can start saying, "well this is a good idea, and I want to pursue it one way or another."  Ultimately you will not cause bad blood, if you gave them every option to move with it, before you took it elsewhere.

have you actually found that mythical AI idea that is actually marketable  (grin)

--dan