Entrepreneurship · Side project

Sharing side project w/ current employer?

Mike Preuss Growing Visible & helping other early stage co's

March 4th, 2013

At FounderDating we really champion starting a side project. I want to hear back from the FD community with your experiences of starting a side project while still employed. 

Did you share you were working on a side project with your employer? If so, how did you do it? How was it received? etc...


A great idea is 1% of the work. Execution is the other 99%. In this course, we’ll teach you how to conduct market analysis, create an MVP and pivot (if needed), launch your business, survey customers, iterate your product/service based on feedback, and gain traction quickly.

Daniel Lo

March 4th, 2013

IMHO a very bad idea.

1. This lets them know you have "free" time or excess capacity. Obviously, you need more work.
2. You are signalling them and forewarning them that you are developing new IP that they may want to claim in the future, since you did it while employed by them.
3. If this project takes off, you will leave.
4. Some bosses are not accepting of competition.
5. Don't use work resources (in the slightest) for this.

Only in the very BEST of companies, the 1% best companies, will this go over well and they will be supportive. This is probably an optimistic number too.

Kirsten Minshall Founder of UVD and CTO at Limpid Markets

November 25th, 2014

Side projects are an indication that your employee has an enthusiasm outside of their day job for technology - it's such an important part of my employment strategy. You'd be insane as an employer to try to stifle that enthusiasm when you can harness its unbelievable benefit. I actively seek such individuals and it's a specific part of the interview process.

Employers cannot have their cake and eat it...

Compare those who work on side projects in their own time; playing with new technology, solving problems basically doing homework and becoming better developers as a result, with those who do nothing outside of their day job. It's a no brainer.

Employment contracts should always contain clauses to make the position clear - in ours, if it's done outside office hours the company has no claim on the IP. This is a 101 for employment contracts along with all the other basics such as non-competing and so on. If you're not familiar with these and you're employing people then you're asking for trouble.

One word of caution: when I say 'side projects' I don't mean a second job. In my experience, those working as regular freelancers outside of their permanent positions can detrimentally impact their performance at work - if they are doing it just for the additional cash or to hedge their career then there are warning signs flashing. If it's about innovating, trying out new things and building stuff they are passionate about then it's a wonderful employer benefit at no extra cost.


Jimmy Jacobson Full Stack Developer and Cofounder at Wedgies.com

March 4th, 2013

I think I have had a very unique and fortunate experience sharing my side project with my employer. Not only did Zappos not mind, it was a great place for beta testing and eventually the CEO led a seed round for us and now we are working full time on Wedgies.

I probably wouldn't recommend this course of action for anyone not working at Zappos, Follow Daniel's advice for all other cases.

Mike Preuss Growing Visible & helping other early stage co's

March 4th, 2013

To stir the pot a little bit.

 I had a chat with a startup lawyer last week and he said you should absolutely let your employer know because they could potentially lay claims to your side project if they find out you were working on it while still employed. 

Jimmy Jacobson Full Stack Developer and Cofounder at Wedgies.com

March 4th, 2013

Yeah, he's right. But you should also be prepared after that conversation to either give up your side project or quit your job if you are passionate enough about the side project.  Those are worst case scenarios.  The outcome you are hoping for is some kind of legal document from your current employer saying they aren't interested in your project and that they lay no claim to it. 

dp

March 4th, 2013

I also would recommend telling the employer.  You want a nice letter from HR / Legal that says "do it on your own time & equipment and don't compete with our core business".  

Michael Brill Technology startup exec focused on AI-driven products

March 4th, 2013

Jimmy, it sounds like Zappos was in Daniel's 1%.  Mike, so why couldn't they still lay claim to the IP if you notified them?  Would you require them to sign some release?  To Daniel's earlier point, 99% of employers will either write off an employee or try really, really hard to get them to be 100% focused on the business.  

Michael Brill Technology startup exec focused on AI-driven products

March 4th, 2013

Not sure I understand the self-interest rationale for informing employer.  Unless you actually need guidance on whether your activities may breach your fiduciary responsibility (if it's borderline you probably shouldn't be doing it anyway), why does it benefit you?

Daniel Lo

March 4th, 2013

There is no benefit for them to sign it and an possible upside if they don't.  Keep in mind, the state your in will definitely decide ownership.  In some states, employees are whole owned serfs and in others such as California there are some laws protecting employees.  Your lawyer will have to advise you on this.

Sean Brookes Founder and Principal at Green Grow Tech

March 7th, 2013

I was fortunate with my last employer: they had language in the employment agreement that they accepted people might have side projects and made it clear the IP claims focused on the employers specific technology field.  

I never felt compelled to officially declare any side projects but the subject occasionally came up with colleagues.  I definitely avoided doing any side project related work on company time/equipment.  And also ensured there was similar language in my new agreement.