When a modest startup begins to thrive, the urge to bring in more investments to foster further growth becomes increasingly difficult to resist. If you’re an entrepreneur under this circumstance, your options are limited to actively seeking more investors to help finance your business.
One of the immediate outcomes of business partnerships is having to share your ideas with strangers that are probably wealthier than you and have more resources to start a venture..
One of the biggest fears business owners struggle with is having their ideas stolen by an entity that is more financially sufficient. It is the principal reason most startups remain small and fail to consolidate on their growth.
There are, however, ways a business owner can avoid losing his or her startup idea to a foreign party. Here, we review five of them. Ensure your business is protected by all legal means available
This is a fundamental step that must be taken when making the decision to bring investors on board a business project. From securing non-disclosure agreements (NDAs) to signing non-compete forms and even insuring your business to protect it from external factors, these legal steps can immensely help in protecting your ideas from theft as well as prevent the consequences of idea theft.
Research the investor
This is common practice because it is simply irresponsible to not perform a background check on a prospective investor looking to invest in your business. While this isn’t an excellent step since the motive of every investor can’t always be ascertained, it does shed more light on an investor’s investment history, pointing out, if it exists, circumstances where the individual engaged in idea theft.
It is just smart to be sufficiently knowledgeable about a would-be investor because it helps to oil the relationship between you and your future business partner.
Don’t reveal your business’ operations
Unless you’re pitching to a corporate entity that intends to invest in your business, it is best to avoid disclosing certain details of your business’ operation. It is okay to share an overview of your startup’s services and even include certain functions that it performs; however, you should know when to draw the line and keep certain things to yourself.
Corporate operations like the inner workings of your business should not be divulged unless the audience is a corporate entity that has proven its commitment to your company.
Apply for a patent
Patents are now common in the corporate world with corporate espionage on a soaring rise. Companies use this tool to exert authority over their ideas and innovative developments. They are quite expensive though, which is why most startups settle for the more affordable provisional patent.
Trademark your company name
Since it is possible to tie a company’s name to an idea and there is legal precedence to back this claim, trademarking your business name may be an option for you to consider as it ensures that you have some sort of evidence available if a legal issue arises.
With successful business idea being far and few nowadays, it is important that you protect your startup from being swallowed by the jaws of corporate greed; so make sure to stick with proven guidelines like the ones highlighted in this article.
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