TIP: Safeguarding Your Business “Pitch” Ideas

Tip of the Month

August 2007

TIP: Safeguarding Your Business “Pitch” Ideas

Any business owner who has to “pitch” ideas— whether it’s for an advertising campaign to a prospective client, or a new product to a possible business partner— knows the problem. A dilemma to which there is no easy answer. Clients want to see something tangible and get a taste of what your firm is offering. How much should you disclose to demonstrate your firm’s expertise, or how do you give them enough to appreciate your idea(s) and expertise without giving away the farm? There is no fail-safe answer, but here are a few ideas. As always, these are general suggestions and are no substitute for specific recommendations from your lawyer:

If your new idea can be patent-protected, then file a provisional patent application and get “patent pending” status. To fully protect your product idea, you will need to file a full patent application within 12 months.

If your concern is for an idea or intellectual property, perhaps your best bet is to have the company or individual you’re meeting sign a non-compete or a confidentiality document before you arrange your presentation. These documents vary based on what they are designed to protect. If “pitching” is a key part of your business, you might want to ask your attorney to develop a template that can be easily adapted for future “pitching” efforts. Most include (at a minimum):
1. A clarification of what constitutes “confidential”. You can’t protect ideas or information that existed before your “pitch” or whose creation did not involve your firm.
2. A defined time frame within which the information is protected by the agreement. Only you can determine what a reasonable timeframe might be. In some cases it might be years or, in other fast-moving industries, it may be a matter of months.
3. A requirement that the person or company you’re pitching agrees to keep your information in confidence. It may be that your prospective client (or business partner) needs to share certain information with you in order that your firm has vital information needed to shape the final “pitch”. If this is the case, it should be relatively easy to get your prospective business partner to sign a confidentiality agreement that protects both parties.

If your request for a confidentiality agreement is turned down, you probably will have to decide based on your knowledge of the other party. Ask around, talk to industry associations and vendors discreetly to determine if the people you plan to meet have a reputation for integrity and honesty. The Internet is your friend when it comes to gathering information.

If your information and instincts suggest there might be a problem, pay attention. Better to lose out on a business pitch opportunity than to see your best ideas stolen.

These articles are intended to provide general resources for the tax and accounting needs of small businesses and individuals. Service2Client LLC is the author, but is not engaged in rendering specific legal, accounting, financial or professional advice. Service2Client LLC makes no representation that the recommendations of Service2Client LLC will achieve any result. The NSAD has not reviewed any of the Service2Client LLC content. Readers are encouraged to contact their CPA regarding the topics in these articles.