Had A Great Startup Idea? Don’t Keep It A Secret

According to the most recent data around a million new startups form every year. Startups are a booming industry if you can call them an “industry,” and everyone is trying to seek out new value in the market place.

 

But there’s a problem. With so many people around competing for limited sales, there’s no enough room for every idea. In fact, only around 10 percent of start-ups make it out of the first 10 years alive. That’s pretty small odds.

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One of the reasons for this might have something to do with the consensus around intellectual property – or IP. There’s a belief in many sectors that the best defense against competition is to keep your ideas to yourself and not to discuss them with anybody else, just in case your competitors copy you. But this is a fallacy. The strength of IP law, especially in places like the US, is actually stronger than ever, You can get patents if you’re willing to wait, copyright your work and get trademarks. Some quotes have even been trademarked. Thus, the problem isn’t lack of legal protection. In fact, the protection is now so good that it rarely pays to try to be the “first mover.”

 

So what’s the logical course of action? Well, it turns out that networking is probably a better idea than trying to keep an idea under wraps. Yes, there’s a risk that somebody might do the dirty on you, steal your idea, and set up their own business, but there are some pretty strong headwinds that act against that sort of thing. For starters, most people don’t want to set up their own businesses. They’d rather have safe careers and plod through life with minimal disruption to their day to day activities.

 

Secondly, the majority of established companies probably can’t steal your ideas, even if they wanted to. The reasons for this aren’t well understood by most entrepreneurs who imagine that thanks to their massive revenues, large enterprises can copy their ideas in a flash. It turns out that big business, with some notable exceptions, are bad at adapting to new situations. Most big businesses would rather go out of business than do the hard internal work that needs to be done restructuring a business to prepare it for disruptive technologies. That’s why so many startups make it big. Large companies simply don’t have the management tools. Skills or leadership capacities in place to turn their organizations around. Startups are lean and a lot nimbler, making it easy for them to offer consumers services when companies can’t.

Flickr

 

Sharing your idea has distinct advantages too. We’re moving beyond a traditional business model in which companies take input from outside of the enterprise, combine them in some way, and then churn out the outputs. Instead, today’s market is more like a lattice of interdependent nodes, each of which adds value to customers. Today’s businesses need to network, to provide the full experience expected by the customer, and they can’t do that if they keep their ideas to themselves.

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