Garages are so 1990s. Today’s startup is much more likely to get its start in an incubator, accelerator, or co-working space (such as WeWork). Getting cozy with other innovators may mean increased business opportunities, collaboration, and a whole lot more fun. The downside is you never know who’s listening to your plans for world domination. So when you’re sharing space with other startups how can you protect your intellectual property and ideas?
The Walls Have Ears
Incubators, accelerators, and co-working spaces are known for their open working environments – shared work tables and open cubicles rather than closed-door offices.
The openness is part of the attraction – people can bounce ideas off each other or find co-workers or vendors in the line for the espresso machine.
One problem is that people may forget that they’re not all working for the same company and may share information that would better be kept confidential.
Another problem is that the informality of business relationships formed in an incubator environment can lead to litigation when one or more “partners” don’t benefit equally from what turns out to be a billion-dollar idea.
So what can you do to protect yourself in an incubator or co-sharing space?
First of all, be aware that it’s very hard to protect a bare “idea.” You don’t own it just because you thought of it first.
The two best ways to protect an idea are via:
- Filing a patent
- Keeping the idea confidential as a trade secret
We discuss how to protect and make money from your great ideas in this three-part blog.
You can try to get someone to sign an NDA before you disclose your idea, but they may refuse. They may have already had the same idea – or they may come up with it on their own tomorrow – and they don’t want to risk a dispute.
Also, an NDA may not help you. NDAs aren’t like the magical protective spells some people seem to think they are. For one thing, people can – and do — violate NDAs. They aren’t scared off by the threat of litigation, because they know it’s often an empty threat.
Keep It Quiet
Here are some tips for keeping your confidential information private:
- Don’t have confidential meetings and phone conversations in public spaces. The person at the next table in Starbucks could be a potential competitor.
- Don’t leave your computer, tablet, or smartphone unattended, and make sure all your devices are password-protected.
- If you store your data in the cloud, use two-factor authentication and take other data protection precautions.
When you’re beyond the brainstorming stage and are ready to put together your startup’s founding team, it’s vital to have intellectual property assignment agreements in place with each member.
An IP assignment is a document transferring a founder’s intellectual property (copyrights, patents, and trade secrets) to the company. You can find a form here.
You don’t have to pay exorbitant legal fees to protect yourself, your ideas, and your startup. Some incubators offer legal services at a heavily discounted price or you can upload your contracts online to get them reviewed within 24 hours at a fraction of the cost of using a lawyer.