I've got an idea for a product and I want to get funding. How do I go about looking for funding without telling too many people, or the wrong person, about my idea?
I don't want it to be stolen.
You could go for an NDA but the truth is that its unlikely to be stolen. So I suggest go through the business planning process which is first to look for a market for the product or service your idea covers. Validate it by asking potential customers that they would be willing to pay and get an idea of price. Best case is get people to commit to ordering your product. Now you have evidence that the idea is viable. Then estimate the costs it will take to create the business. So the truth is talking about the idea and selling it is normaly the best way to get funding. Normally people steal an idea after its been proven to be viable not prior to that. So worrying about it this early is normally off.
Of course you could just tell me your idea and then I'll tell you if you should or shouldn't have kept it to yourself. ;)
If the idea is more than just a notion but something that you've got a working model and clearly has profit that's when you begin to worry about it. But let's say you were creating a search engine. You can talk about what it is that your solving without going into the algorthims that solve it.
Your fear is a common mistake by new entrepreneurs. Check out my detailed blog post on the topic: http://blog.foundrs.com/2009/03/11/the-great-startup-idea-that-i-cant-reveal-yet/
No one funds ideas. If I invested $100,000 in your idea today, what would you do? Often, the answer is: hire a developer. Ok, so now try to find a co-founder who believes in your idea. Whatever you plan on using the money for, you can always take one more step on your own.
As you start executing, also start getting in touch with business angels. It will take time, but the sure way to fail is to not make progress and go from idea to prototype.
At this stage you should not be worry about having your idea being stolen because if you don't share with people, you won't be able to get the founding team and the more people know the better chances you have in getting funding. The best advice I can give you is about my own self. I came up with a idea about few months ago. So I wanted to make sure I can achieve what I have thought, I did the following things to make sure I could launch my venture and be successful at it:
Once you get all that in place, you need to find out (should be in your business plan) how much money you need for your startup. Once you could figure that out, you need to decide if you want to approach Venture Capital firms or Angel Investors for funding. (Very important you know the difference between these two because VC always want more share of the company but can offer great support and more funding in near future where AI are some who is successful entrepreneur).
Angel.Co (not .com but .co) is the site where Angel Investors look at the pitch from startup entrepreneur and if they like your idea, you will get the money funding. But remember, you are require to post your idea (you don't have to give out all the detail) but my personal advice to you is even if you cannot share your idea with anyone than you will have hard time truest anyone. If you get the chance watch, Social Network (Facebook movie) and you might think what the heck I am saying but if you are a entrepreneur than you should watch that movie. Will give you many good tips.
Rest, good luck with your venture and hope I could help to solve your problem. But remember one thing and it will really help in long run; you can come up with trillion dollar idea and it has huge market but it you who know how to implement that idea. Without right implementation strategy your idea worth nothing but a penny. Once you succeed in that process watch hundreds or even thousand new companies born from your idea but will not succeed because you master the Implementation Strategy that made your business successful.
John gave good advice. Ideas are a dime a dozen, it's all about implementation. The best thing you can do for yourself is share your idea with as many people as possible, and start validating that you have an idea worth investing in. From my little experience in the VC world, they aren't in the idea-funding business, but are looking for ideas with traction (e.g. customers). Good luck!
VC's have other ways of screwing you. But, if you are really worried about it, dry to get as much done without taking money as you can. Even if it is just wire frames. The other route is a friends and family round.
I tend to agree with the board. The word would quickly get out that a VC is stealing ideas. Another thing you can do is find out what investments the VC already has in their portfolio. If they have one that competes with you head to head, they are likely not going to be interested unless you have a better mouse trap. If you do, then I would still pass on that VC because it will make it to your competitor.
We are going through that now with a series B round. A VC has a business that loosely competes in their portfolio. Ours is a relationship business that uses software to service our clients so we are not worried about it. That said, we track the other company hitting our site and our profiles and any public data they can about us. Prior to our presentation, we were not on their radar.
all a crap shoot. I wouldn't sweat it. They are buying the management team as much as the idea
Lots of startups try doing "stealth mode," which frankly is a load of crap. If you're doing something that CAN easily be replicated, then you're either going to win on quality or speed; and if it can't easily be replicated, then you don't have much to worry about, do you?
As John said, don't give away the "secret sauce," but when investors hear the words, "NDA," "Proprietary _," or "Trade secret," they tend to run for the hills unless it's patented and/or the company is already profitable.