How do you avoid getting Zuckerberg-ed?
I'm helping some non-technical people start their startup and the question is a common one,"How do I prevent my technical lead from stealing my idea and creating their own version?" I've struggled with a good answer. Is there any standard contract for this kind of thing?
7 comments
[ 38.8 ms ] story [ 1056 ms ] threadOther people can chime in on the legal aspects, but I suspect there's not a whole lot you can do. Ideas are only protectable to the extent that you can patent them, which costs money and gives you only a very limited monopoly. If all you have is a general idea for "I'm going to enter this market," you haven't actually added any value.
Honestly Facebook was far from the first social website — in fact during the web 1.0 era theglobe.com went public and once upon a time there was a great site called SixDegrees.com which lasted from '97 until 2001 and used the same formula that facebook did. But the difference was execution, execution and execution.
On a side note techies get screwed over by business people more than the other way around. For every Gates there are dozens of inventors who lost out on their patents and the like. So your real question should be "How to avoid be Winklevossed?"
If you are not valuable equal to your equity share, reduce your equity share to a more appropriate value or GTFO.
I calculate equity split on my startups using an auction format and it just works: http://nerdr.com/hacking-the-50-50-equity-split-using-shak/
1) the idea is sufficiently novel that it would be difficult for an average person to conceive without suggestions
2) the idea is commonplace, but the value-add is something that is not obvious
3) the idea is a clone.
In the third case, there's really nothing you can do to protect yourself.
The second case is what happened to the Winklevosses. Their value-add, the idea of exclusivity, is something that a lot of people write off as obvious. However, and a poster correctly pointed out, the idea of social networking is commonplace. The cachet was an idea that the Winklevosses figured out, and that essentially was what propelled the entire project (had that been commonplace, someone else would have tried a long time ago)
Again, its difficult to protect nontechnical people in this circumstance, but the idea would be to let the technical people build the standard stuff first and then reveal the value-add after trust has been established (the winklevosses made the mistake of revealing the value-add way too quickly, before establishing trust)
In the first case, you definitely want to learn the technical stuff yourself. Especially if the idea is really good, in which case any developer would try to zuckerpunch you. You don't really have any protection, other than potentially trying to patent.