Unfortunately many founders are still reluctant to sharing their ideas with others. They are afraid that someone might copy their idea, be faster than them, outpace them and ultimately run away with all the revenue. Thinking about NDAs is a waste of time and simply useless. You don’t have to worry about someone copying your idea in an early stage and here is why:
1) No money, no copycats: No one will try to copy your idea before there is a proof-of-concept. If there is no proof-of-concept there is no revenue and no investors. Hence, there is no proven opportunity and no money involved. Where there is no money, there are no copycats. It’s as simple as that. Even the brightest idea has to be successfully tested on the market before someone might even think about copying it. Once you obtained your proof-of-concept, have investments from well known investors and have a significant amount of revenue under your belt you should start worrying about copycats. That’s why you should use your time to your proof wisely and try to build up barriers to entry. Barriers that will make it more difficult for competitors to copy your product and enter the market. Be it patents, trademarks, customer loyalty, a good partner or even “faking” your own product.
2) Lack of Resources: The second reason why you shouldn't be afraid of copycats in an early stage is that most companies have very limited resources. This is true for large as well as small corporations. Small companies having limited resources makes sense. They are a few people handling many different tasks. But when we think about large corporations on the other hand we usually have the image in our head that more employees equal more resources and more money. This holds partly true. Big corporations make a lot of revenue, but most of it is already allocated to existing operations. Moreover, large corporations are shrinking and firing employees instead of hiring. This results in an immense workload increase per employee. In my times at large corporations most employees I got to know were jumping from meeting to meeting, not having time to even think about what they were doing and if it actually made any sense at all. Working on their actual job was almost impossible. It was so bizarre. Summing up, if large or small corporations would want to copy an idea they would simply not have any resources to do so. Why do you think so many corporations started incubators and accelerators?
3) Forming a team: Think about your own startup. How long did it take you to recruit your founder team? Some people never find a suitable founder team. If you would want to build a startup it will most probably take you a couple of months to find a great team. Even copying an idea needs a brilliant team that perfectly works together with each other. A team randomly put together is no real competition for any serious founder team. I am absolutely sure that nowhere on this planet you have the perfect teams sitting around and waiting to copy ideas that a) don’t have significant revenue yet and/or b) don’t have any larger investors on board. They will either go and copy successful models that were proven to work. Models that already attracted a lot of revenue and investors.
4) Exit/Acquisition options: If you are still afraid and convinced that somewhere on this planet there might be a copycat waiting to copy your idea you should try to be a little bit more optimistic. Why would you care about a startup from let’s say India trying to steal your idea and build it up there? It’s a market you would probably only expand to in a couple of years or decades, if you’d ever achieve to come this far. There is really no need to be worry about it. Look at the bright side of it. There are two different scenarios. The company in India does so well and will buy your company once it plans to come to Europe. Brilliant! If you are more successful than they are and you plan to expand to India you can buy their company. This might save you many years of stress, disappointment and misunderstandings in a very different and unknown cultural environment. Even more brilliant!
As you can see there is really no danger from any kind of copycat in the early phase of your startup. So go out there, talk to people about your vision and plans, collect feedback, get supporters and let people participate in building your venture instead of working on your idea in stealth mode or in a dark and hidden place.
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