Are you about pitching an idea to investors in USA and you are scared of losing your idea? If YES, here are 10 best ways to protect your business idea in USA.
People happen on bright invention ideas everyday, and they believe that such ideas, when produced and taken to the market would yield enough profits to keep them comfortable for life. But one thing they have to guard against is idea theft as it is a fact that an unprotected idea can easily get stolen, and a good number of novice inventors have had issues with idea theft after a pitch. This is why the law requires anyone that has a product idea or invention to get it patented.
According to the law, any person who invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent from the United States Patent and Trademark Office.
This is one sure way to legally protect your invention or business idea from getting stolen by another savvier and moneyed entrepreneur. But the sad news with obtaining a patent for your product is that it costs quite a bunch, and it takes a long time to be concluded, say up to 24 months or more.
This may be a shocker to anyone who may wish to procure a patent but does not have the wherewithal or the time to wait for the bureaucracy that is normally encountered when getting a patent. If you fall into this category, there are still other ways you can protect your intellectual property, business idea or product without a patent. They include;
10 Iron-Clad Ways to Protect a Business idea from Being Stolen Without Patent in USA
- Use Non-Disclosure Agreements
A non-disclosure agreement (NDA) also commonly known as a confidentiality agreement is used to safeguard a business’s proprietary information especially when sharing nonpublic and/or proprietary information with another person or organization.
A non-disclosure agreement can be used to protect your idea before revealing it to workers or other associates, or even when making a pitch to an investor. Though most investors would shrink at the mere sight of a non-disclosure agreement, but you can at least give it a try.
However, it is important to note that many investors will balk at a non-disclosure agreement, so you can skip it altogether so as not to miss out on potential funding. An NDA can also work for potential clients. Instead of requiring a signature, consider simply printing a confidentiality statement on your business plan.
It is also possible for an employee to sign an NDA with an employer. In fact, some employment agreements will include a clause restricting employees’ use and dissemination of company-owned confidential information. A non-disclosure agreement does not take time to obtain neither does it cost an arm and a leg as you can simply download them online and get your lawyer to sign it.
- Non-compete agreement
A non-compete agreement is an agreement between two parties, typically an employee and employer, where the employee agrees not to use information learned during employment in subsequent business efforts for a set period of time.
A non-compete agreement prevents an individual or entity from starting a business that would compete or threaten yours within an established radius. A compete agreement kicks into action when an employee leaves his or her employer, and the employer wishes to prevent the employee from competing against them in their next employment, or even to use his business ideas to start a personal business and thus constituting competition.
So, if you had to hire help when developing your business or product idea and you do not have a patent yet to protect the product or business, then a non-compete agreement would have you covered.
- Work-for-hire agreement
A work for hire agreement is an agreement that allows the business, individual or organization that is doing the hiring to own the work that is created. If you hired an independent contractor to help you complete a project that is yet to be patented, you have to ensure the contractor has no rights of ownership over the work or product created by using this agreement.
This is an exception to the general rule in the United States that the author or creator of a work retains ownership rights to that work.
- Avoid the temptation of sharing too much
One of the best ways to secure your idea is to only reveal what is absolutely necessary. If you are pitching an idea to a potential client, give only the details necessary to convey the idea. It is not necessary to share every detail of how your product works.
With this, you can prevent your ideas from getting stolen since you are yet to have it patented. One exception to this rule however may be when you are pitching to investors or lenders, as they will likely want to know everything about your product before taking a financial risk on it.
- Apply for a Patent pending application (PPA)
It has been established that patents take too long to be completed, so in order to establish ownership of a product idea, inventors and manufacturers often place the words “Patent Pending” directly on the products until the official patent is issued. This term lets other inventors and marketers know that the USPTO application process has already begun.
If you only need to buy some time, say to pitch your invention idea, you can always file a PPA. If an inventor has a patent pending for an invention and a company begins to use that invention without his permission, the inventor can proceed to get the patent issued and sue the company for patent infringement.
- Trademark Your Name
A trademark is a recognizable insignia, phrase or other symbol that denotes a specific product or service and legally differentiates it from all other products. In the event that a product does not have a patent yet, taking out a trademark on the product name can prevent it from getting stolen.
Also, by establishing a trademark, you also have added protection in the event a legal issue should arise. The documentation required to register a trademark can serve as written proof that your business idea was in the works at a specified time. These dates are quite important in establishing the exact date the idea was in use in the event someone else tries to dispute this fact.
Ensure to put TM (for a product) or SM (for a service) by the name. That makes others aware that it is yours.
- Trade secret protection
In order to use this method, you have to first determine whether your idea qualifies for it. Trade secrets cover a much broader spectrum of inventions than patents. They can include formulas, patterns, compilations, programs, devices, methods, techniques and processes.
Although theft of trade secrets is generally difficult to prove and protections are weaker than those of patents, but you can seek protection for trade secrets using various legal theories including breach of confidence, breach of contract and industrial espionage.
- Know your competition
Sometimes your enemies are actually allies; if you can make your competitors contractors for part of your idea, they may be happy to do business with you and still respect your boundaries. Also, by being very familiar with your competition you still have a better idea of what their resources are and how to protect yourself from them.
- File for copyright
A copyright protects original works of authorship. If you have an original idea such as a premise for a screenplay that you have written into a summary, your work is copyrighted, but it pays to get it properly registered and copyrighted. Registration allows you to establish a public record of your copyright, which can help support any potential infringement claims.
The registration process differs according to the type of material produced, but always involves sending a copy of your work and a processing fee. This process is simple enough and it presents a good way to protect your written materials without a patent.
This can also be used for a product idea that is still in written form. If you are making a pitch to a company or individual, you may already have designs and paperwork describing your product or service, proposed operations and business plan. It is required that you should have a copyright warning at the bottom of every page. It shows your commitment to protecting your idea.
- Buy all URLs relevant to your business idea
Many unknowing inventors and entrepreneurs forget to buy the website addresses (or URLs) they will want to use for their business, and it can end up being a problem if someone gets wind of the idea and proceeds to acquire those website addresses. So, it is really necessary for entrepreneurs to acquire their business URLs as a way to protect their business.