Shhhh - Keeping Great Business Ideas Secret

"How do I keep my business plan idea secret?"  That's the just of an email we received recently.  It is an issue common to a lot of entrepreneurs, so here are some recommendations.

NON DISCLOSURE AGREEMENTS.  Forget them.  No banker or venture capitalist or angel investor will sign them.  If you don't trust the person you are seeing, just don't see them -- go somewhere else.  The only time you will use a NDA is if you are presenting your idea to a large company in your field.  In that case be as protected as you can possibly be before stepping in their door.

PATENTS AND TRADEMARKS.  Not cheap, but if your idea is truly original, this is they way to go.  Do it before people start talking about your product/idea -- afterwards is too late.


THE PROPRIETARY ANGLE.  This is taking something ordinary, like jeans, and putting your logo on it, then selling it as "your style".  You will likely change something in the common design, and for that you will want a trademark.

Those are all fine and dandy, but what if your great business idea is putting a donut shop in a town that has none?  There is little in that that can, or should, be trademarked or patented.  Your logo can be trademarked (if you deal in interstate commerce), and your name can be protected.  But the basic idea -- a donut shop -- doesn't get much protection. 

But there are still some things you CAN do, such as ...

Capture the market before anyone else has a chance.  Get your start up business plan in place, be ready to move, and move fast, when the business financing is in order.  Capture the market fast.  You can't prevent another donut store from opening, but you can give them cause to question if they want to compete with you.

Out perform any one else.  Don't just do a donut shop.  Provide delivery service, customization, and customer service that none can match.  This makes your business a very formidable competitor, no matter how many copy cats there are.

Remember, too, that competition isn't necessarily bad.  One company alone would not have brought the world into stereophonic sound or social marketing.  It takes a lot of companies to bring attention to a new idea.  It is a truism that the first company has to spend gazillions of dollars to tell people about a new idea;  the second company just needs to have a product a sell.  So consider whether or not it might be helpful to have other companies in field to help split up those initial promotional costs.

The bottom line is that there is no way to prevent competition.  The best defense is to be THE best business in the field, no matter what the field is, from potato farming to biotech development.

And be very comfortable with the people you are working with.