Q: How to avoid my new business model or concept being copycat by our potential competitors? Particularly our competitors have more resources and they want to copy our model to launch a consumer App product.
Is it a wrong strategy to pitch our idea to other people when it is still at a very early stage?
A: Copycat is a fact of life. The Swiss pharmaceutical industry, for instance, can be traced back as copycats of the German’s and the whole Chinese ‘Shanzai’ industry are essentially copycats.
Now, what you are talking about here, in my view, is a bit tricky. If I understood correctly, you are specifically referring to business model or concept. Therefore, the very big question you should ask in the first place is whether your business model/concept is really patentable. It is especially the case if it is at a very early stage of development.
There are essentially three ways of dealing with the challenge here:
- Keep it as a trade secret to yourself. This way, you may be able to keep it safe. Yet, as an entrepreneur, you may seriously constraint yourself from seeking external resources or other development opportunities.
- Maximize the legal protection as much as you can, such as get it as a patented invention. The upsides may be obvious if you choose to go down to this path. However, there are also some downsides. For instance, it may be a costly process to go through as an entrepreneur, or you may even run the risk of being ‘disclosed’ and therefore ‘copied’ during the patent process. Not to mention that the legal proceedings and enforcement costs are really high in case of any breaches.
- The ultimate solution, in my view, is to make sure that you always stay ahead of the curve, whether it is development or execution.
Having said that, always be careful who you are pitching or presenting the idea to. There is no wrong or right strategy to go about it. It really depends on the audience and your own understanding/grasp of the situation or ‘gut feeling.’ It is essentially a judgment call that you’d have to make. When in doubt, use your common sense.