I have this idea where i can possibly and hopefully change the game in e-commerce and social media at once . So i approached this investor and he told me to forward the plan so he can think of it. As it is only in idea stage and i don't have enough capital for marketing and development of the idea into products , i am thinking of giving him the project idea .
How can i make sure that this idea does not get used by him or any other as this is a game changer ?
Hope i get help from my co-founders
Feel free to message me !
That is a classic problem. In inventions field we see that fear alot. Some inventors think that talking about their idea could screw them hard. The opposite is true. You have to keep in mind that the process you went through to have this wonderful idea is accessible to alot of others thinkers or inventors, it may already be in the hand of others with better skills and finance. The success of an idea is not the process that produce the idea, but the quality of the team skills and the execution.
For what I understand your idea is very good from your point of view, but it is at the same time worthless if you cant execute it.
How to increase your idea value by opening up and minimized the divulgation risk by showing just enough to attract but yet not too much with the "short skirt strategy"
In inventions field, you can have a temporary patent for 100$ that would protect your idea while you talk with investors, the low cost permit you to change the design to better respect the requirements of the investors if needed, then ask for another temporary patent. This strategy require that your idea is protectable by patent, which is probably not the case for web applications.
In case of ideas that are not protected by patent, you still can follow a similar divulgation structure. When you patent an idea you have to make it public, but the patent content is crafted in a way that it is convincing enough to met the originality and innovative criterias and at the same time incomplete so that the others cant reproduce it without R&D. I would advice that you require a non-disclosure agreement and also that you keep any secret that require work overtime hidden.
As an addition here: I am not talking about hiding anything, but any core business is not deliverable in a presentation time frame. Its more about selective divulgation.
If you dont have anything of value that can be kept secret, you probably don't have a core business yet and your concept is probably not mature enough for divulgation.
If all you have is an idea with no ability to implement it, then it is highly unlikely that any investor will agree to give you money. Moreover, if your idea is so simple that it can be stolen from its description, then it's worthless, if only because thousands of people have already thought of it. So, it doesn't really matter what you do - tell him the idea, not tell him, ask for NDA, not ask for NDA - the result will be the same. Although, I should note that no serious investor will ever agree to sign an NDA, and asking him to sign one is a sure way to convince him to never speak to you again.
I'm going to give you three increasingly detailed answers.
1. Yes, give this person your plan. Unless your investor is extremely naïve, he or she will demand to know what your idea is before being willing to invest. And on the odd chance that he or she is that naïve, you don't want him or her as an investor.
2. Yes, give this person your plan, and keep in mind that no one's idea is that good. Basic rule of thumb of entrepreneurship: any idea you have, others are likely to have as well. On the idea-vs-execution spectrum, it's 1% idea, 99% execution.
3. Take a step back and get some education on entrepreneurship before you strike out. Your question isn't atypical of brand-new, completely inexperienced entrepreneurs, but that inexperience means you may not be not well equipped to do what you're about to do. When people worry about their idea being stolen, or think that their idea is going to "change the game" in a market segment (let alone two at once), that sets off all sorts of neophyte warning flags for me—and it should for an experienced, useful investor as well. Find a successful local entrepreneur who can mentor you. Take some entrepreneurship classes. Participate in local groups that offer learning experiences. Don't worry. You'll always have plenty of new ideas.
Update: I've seen a number of responses here suggesting that you have the investor sign an NDA. I've been part of angel- and venture-funded startups for decades, all software but in different market segments, and in various geographies (CA, NC, WA, and BC), and I've never seen an investor sign an NDA. Ever. Again, a naïve investor might do so, but the kind of investor you want—someone with tons of experience, who can provide business and money connections, and who can mentor you to the extent you both desire—won't sign such a thing. They can't. They see too many plans to do so. If they started sharing details between startups, word would spread quickly and they'd be frozen out of investing. Honestly, with a seasoned investor, an entrepreneur requesting an NDA is a warning flag of inexperience.
If you think this person will invest in your app without knowing EXACTLY the opportunity and knowing all the ramifications I believe you are very mistaken. Anyone who wants me to invest with out giving the FULL story just makse me want to say no.
I agree with what most of the people said here.
Agree to sign a NDA with him, and explain your reasons for doing so. If he is a true investor, he or she will understand your standing point.
However, he is the caveat..one which I heard none of this people tell you:
IDEAS ARE JUST IDEAS, EVERYONE HAS THEM.
Very few investors put in money in untested ideas. My advice would be, find a way of prototyping your idea and testing the market response. Get valid data about it, it gives you an upper hand when approaching investors because then you have figures to back you up. You can say we tried A and we are certain with a seed funding of X amount we can move to point B. Investors take you a bit more seriously when they know your idea is tested, and you know what you want to do with their money. For now, BOOTSTRAP.
Is your idea To create a ecomerce social network ? From the sound of it. instagram buy button , Facebook store, google buy what you see, Pinterest shoppable content, the video shopping button already exist. amazon and Facebook discussing a collaboration. not to discourage but just highlighten the overcrowded space you ideas belongs to. If not, excellent have you validated your idea? Investor are hearing ideas by a dozen everyday now. Most of them would not sign a NDCA. do not get attached to the idea. Focus on execution. bootstrap, develop, validate.then goto investor you will get a better valuation as well. try incubators they might Be more helpful.
You can always use a NDA.
I had the same situation as you. My advice is you can go about it in two ways. I did the first and my investor understood and respected my wishes.
1. You can email him and ask to meet again in person saying that you don't want to email your idea because your concern about the idea ending up in to many hands. When you meet in person you can have him sign in NDA (non-disclosure Agreemen) you can create one for free at rocketlawyer.com
2. You can just tell him, most people are to busy with what they have going on in their life that they won't stop to take your idea and run with it.
Those are just my two sense, do what you feel comfortable with and I wish you the best of luck.
No... I don't agree with you. It's usually the other way round. You give yourself a chance to improve your idea further when you discuss it with others... It's not usually the idea but your efforts that matter more.
Its a complicated question that doesn't have a good answer. But here are some things to consider. 1 once you publish an idea the clock starts on IP, if you think you have a valuable idea consult with one or more attorneys an get advise specific to your situation. 2 almost all ideas are awful. This doesn't mean it won't work. Terrible stupid blunders achieve total success all the time. Its a competitive marketplace out there which doesn't produce good ideas. 3 trust, trust, trust, at the end of the day and the beginning of your journey you need to decide what your life will contain. Who is in it and on what terms is top five easy on that scale. Examine yourself and why you are doing this as well as why you want to be doing this. That internal clarity will guide you more than any specific advice any of us could ever give you.