4 Tips on How to Protect Your Business Idea from Being Stolen
Knog is a bike light manufacturer based in Melbourne, Australia.
They developed a unique, well-known line of bike lights. When Knog was developing their lights, they had a patent and current design registration.
Though, a Chinese manufacturer copied Knog’s lights. Luckily, Knog took legal action and stopped the manufacturer from selling the stolen design.
As illustrated, idea theft is a concern for business owners. Put into context, most of the people you interact with during an idea’s development are not out to steal your ideas. Still, you should know how to protect your idea.
Here are four suggestions for how to protect a business idea as you share it with others like investors and colleagues.
1. Non-Disclosure Agreements and Confidentiality Statements
A non-disclosure agreement (NDA) is one way to protect your idea before you present it to associates. Though, potential investors and clients may not want to sign an NDA.
In these cases, you may have to forgo the NDA for the sake of gaining investors or clients. You may want to print a confidentiality statement onto your business plan and presentation materials.
2. Apply for a Patent
Applying for a patent is a way of protecting a business idea. Though, you can’t patent an idea. But, you can patent a method of doing business if it meets specific criteria.
You can apply for one of three types of patents: utility patents, plant patents, or design patents. The one you apply for depends on the nature of your idea or invention.
If your business idea that is more or less abstract, you can apply for a utility patent. A utility patent is for any new and useful process, machine, or article of manufacture. It’s also for any new composition of matter.
The U.S Patent and Trademark Office (USPTO) has specific requirements for these patents. Your idea must be novel, non-obvious, and clearly documented.
Non-obvious means that someone with the same skills could not have come up with your idea. A patent is often the first recommendation for how to legally protect an idea.
3. Trademark Your Company Name
A trademark is another way of protecting a business idea. It serves as an added layer of protection because a company’s name is tied to its ideas. Establishing a trademark also gives you extra protection should a legal issue arise.
The documentation for registering a trademark serves as written proof that the business idea was under development at a specified time. Dates are essential to pinpointing an exact date your idea came to be should someone else dispute this.
4. Document Everything
As you develop your idea, put as much in writing as you can. Then save all that documentation. You are essentially creating a paper trail documenting proof of concept.
Should you ever need to go to court to defend your intellectual property, you will have a detailed history of your idea’s development.
How to Protect a Business Idea
The odds that someone will steal your business idea is minimal. It could happen, though the threat shouldn’t keep you awake at night. Don’t let a fear of idea theft keep you from pitching your ideas or reaching out to potential investors.
You need feedback from other to grow your concept. If you never discuss your ideas with new people, you miss your chance to gather that feedback.
Taking the four steps mentioned in this article should give you some peace of mind. You should feel free to share your ideas with those who can help you turn your vision into a reality.
If you have questions about how to protect a business idea, please contact us.