how secure is sharing business idea for investment


I've a simple idea which I believe will definitely yield good returns.

Now how I can share such simple idea with multiple potential investors. I fear they may say no to me but implement my idea on their own.

In this case how can I communicate with investors and explain my idea.

How this would be If I say "I'll legally bond to you but not reveal the idea. Just release the funds on submission of bills to you and when it is implemented you may enjoy the fruits"

Can we register such ideas as intellectual property(in India).

Ideas Business Model

asked Mar 25 '13 at 23:13
The Lucky Goof
113 points
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  • Investors want to invest, not steal ideas, so don't worry about that. No sophisticated investor will sign an NDA or similar, so don't waste your time on that. – Steve Jones 10 years ago

1 Answer


Most people will tell you "ideas are a dime a dozen" , or "share it with the world and get feedback", or "it's not about the idea, it's all about the execution". I totally disagree with these perspectives; these are just dogmas, things that people believe and repeat because that's what everybody else is saying and who wants to take the risk of going against mainstream? Every dogma has some truth to it, as well as limits.

Now let me clarify my point of view: I think that many business ideas are actually worthless, that some ideas are good and that really really great game-changing ideas are very rare. So if you think you have a really great idea, that's awesome. Now move on to the execution phase.

First: investors that can actually help you won't sign any NDA: it just doesn't make sense for them because they expose themselves to future lawsuits.

Second: if you have a great idea but you don't have the resources to put it together, I'd recommend against meeting with investors when you're just at the idea stage. Startup investors know other entrepreneurs and if they really like your idea, they'll probably share it with people they know to discuss its validity, and that's when you'll be at risk of seeing someone else execute on your idea. Investing in a startup is about trusting the founders and if an investor doesn't know you but knows other entrepreneurs, then he's more likely to fund people he knows than to fund you when you're just at the idea stage because he'll most likely think "ideas are a dime dozen and it's all about the execution anyway". Third: let me tell you a story. At the end of 2011, I applied to a startup incubator that was vetted by Silicon Valley entrepreneur/investors/mentors. At that point, I wasn't at the idea stage anymore but still had some way to go to get to a finished working product (I'm actually still working on it.) I had the concept, the UI and the coding was about half-way done. Part of the application included an NDA, so I thought there'd be some kind of protection and I applied, but wasn't selected. Then, a few months ago, I just discovered a startup that released a product with the exact same idea: out of nowhere (actually, out of a totally unrelated product and unrelated personal experience), the founders had somehow pivoted into the space I'm in, with the same innovation, and yet their background just didn't seem to fit the story. In fact, their website read so similar to my application that I felt sick to my stomach reading it. But of course, a) I know I'll probably never be able to prove that the founders were connected to the incubator or that they saw or heard about my application and b) I might actually be wrong about this, even thought my intuition tells me otherwise. Like you, I think my idea is truly game-changing and addresses a very large target market, and so did some VCs who ended up investing over 20 million into it (at least I know I'm onto something!). But at the time of that application, I had just the idea and a half-way finished product. Now I'm not suggesting that all investors and incubators look for innovative ideas to execute on, but I'm sure that it happened, even though of course no one will ever say they've ever taken part in such practice. So don't be naive and when doing business, be aware of other people's interests, not just yours. So, based on my personal experience, here's my recommendation to you. You say that the idea is simple so may be you can put it together yourself, or may be you need a co-founder to help you code it. In any case, I recommend that you build the product first, before talking to investors. To address your concern about how secure sharing a business idea is, just assume that you're sharing it with the entire world. Then, when you've got the product finished or nearly finished, go talk to investors to get the funds you need to launch and scale. And keep in mind that there's some truth to every dogma and I really do think that execution is the second side of the coin: you need both a great idea AND great execution to succeed. If you only have one side, then you're missing out: great execution on a bad idea or great idea but no execution both lead to nothing. So in terms of executing your idea, I recommend putting the product together, testing it with a few people who aren't into the startup world but who are part of your target market, and then talk to investors when you reach that stage. Of course, all this assumes that you actually have a great idea.

Ideas and imagination are the most valuable ingredients of entrepreneurship and while your ideas might be copied, no one can take away your imagination. For sure, some people will disagree with me about this answer, but I don't care about being politically correct.

Good luck on putting your business together: now that you've got the idea, focus on the execution.

answered Mar 26 '13 at 00:50
4,166 points
  • In mycase investor is already a player of the same sector. Now how can I approach him with out presenting the idea but asking him to invest with trust in me on account of the profits it will return. How if I say "I'm ready to legally bond with you for the amount I take/you invest in, but I cant expose the naked idea"? I'm thinking to ask to release funds step by step on submission of the respective bills – The Lucky Goof 10 years ago
  • "how can I approach him with out presenting the idea but asking him to invest": think from the point of view of an investor instead of yours. Would you invest in a company without knowing what it's about? – Frenchie 10 years ago
  • thanks for the timely reply, then what I'm supposed to do! Understand that the investor is already a reputed player in the same sector. what would yo do if you are in my situation. – The Lucky Goof 10 years ago
  • In your situation, I'd focus on building the product; you shouldn't need an investor for that. May be you need a co-founder if you need help coding it. Take a look here: If you say "the investor is already a reputed player in the same sector" then doesn't that make him a competitor? – Frenchie 10 years ago
  • the hardware establishment, licence cost is really big, so I should take this ahead only with an established player at the same time I cant share the naked idea in the fear of idea theft – The Lucky Goof 10 years ago
  • What kind of "hardware establishment, licence cost" are you talking about? Are you building a web-based or hardware-based startup? – Frenchie 10 years ago
  • a web based software service which needs towers to pump the signals, spectrum licences and hardware that supports it – The Lucky Goof 10 years ago
  • Then you're in a tough spot because you're building a capital intensive business. If you're just at the idea stage, you're not likely to get funded unless you have already demonstrated entrepreneurial experience. May be you can use your imagination to come up with another idea that you can bootstrap, scale and sell. Heard of serial entrepreneurs? If you just have the idea, you probably won't get funded and your idea will probably be taken if it's simple, poweful and has market potential. – Frenchie 10 years ago
  • thanks alot for your time and expertise. good day ahead :) – The Lucky Goof 10 years ago

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