Ideally, entrepreneurs will be talking to people right away—sharing their ideas from the get-go and gathering valuable feedback.
You need to gauge how the world reacts to your ideas and plans, and adjust as necessary.
Stealth mode: yes or no?
There are pros and cons. Going full stealth mode means you definitely miss out on building some buzz and anticipation around your offering. And as part of this you miss out on how you can best pitch and position the offering as you gather momentum.
Also, there is the broader feedback that you go without. There are ways to make up for this, but how do you even know you’re asking the right questions? Feedback is most valuable when it’s answering questions you didn’t even think to ask.
This makes sense when you’re building something quite new in the market and you’re already far enough on your way that others would be discouraged from following. So much for the cons.
On the pros side, these is certainly upside to going stealth. Some form of secrecy has long been the norm. Perhaps you already have a very clear vision, and you just don’t need the branding and PR distraction. There could be more premium in building capability before going live.
The most common justification for secrecy if you don’t want to give up your direction to the competition. There is a reason secrecy is still notoriously the case, say new car models, or consumer electronics releases.
The justification is that you don’t alert the competition to your. plans or direction ahead of time. You build things being closed doors until you’re ready for prime time.
And so a major dilemma arises — how much to say to who, and when.
One issue is commercial sensitivity.
The other issue is the IP situation.
The situation is framed as a need to ''defend'' your commercial interests and IP position. That language downplays what you’re really doing. Truthfully, you’re amplifying your interests and position if you get it right.
You probably have a good read on commercial sensitivity. It’s familiar terrain, and most people are confident to make decisions on this front.
The IP issue is a whole different landscape, and so it’s the focus here. The purpose of this rough and ready overview is to get you equipped and confident to make informed progress. You will be able to ask the right questions of yourself, and work on any areas you remain unsure.
One perennial issue facing tech startups is that the founders are concerned about disclosing critical or sensitive technical information before they’re ready.
As most people appreciate, there is an intersection with IP here, and it’s important to get it right first time.
Poor decisions made in haste up front can be very destructive of startup value.
Your patent position in particular can be easily compromised by an ill-timed disclosure made outside an obligation of confidence.
The usual recommended way to ensure an obligation of confidence is through an NDA—namely a non-disclosure agreement. Sometimes called a confidentiality agreement.
The idea is that the parties agree that the confidential information shared by the other party is to be kept confidential.
There are two critical reasons for NDAs. First, to restrict the circulation of commercially sensitive information. Second, to avoid potentially invalidating IP rights, especially later patents rights.
Seasoned entrepreneurs tend to pour a lot of cold water on NDAs. Black letter lawyers will insist that NDAs are an essential safeguard. What to think?
There’s a good case for a reasoned middle ground — biased to sharing as much as you can as freely as you can.
Let me explain.
You need a plan and some preparation.
The plan is simple, and here it is:
1. Divide your information into General Information and Sensitive Information.
2. Share General Information, Guard Sensitive Information
It’s as simple as that.
The preparation is working through what can be shared, because having that information in circulation does not represent risk.
General Information you share will vary for everybody but will typically include
• Elevator pitch
• Addressable market
• General strategy
• Short form plan and projections
• Team and network
Sensitive Information you guard more carefully will typically embrace:
• Detailed commercial strategy
• Detailed financial statements, and projections
• Unannounced technology developments or partnerships
• Other proprietary details best held back for now
This approach doesn’t mean you can’t share Sensitive Information when it’s necessary.
Just that you don’t share Sensitive Information automatically, unselectively or without a thought.
When you do share that Sensitive Information, ideally it’s with somebody you trust, and who is under an obligation of confidence.
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