funding, idea, non-disclosure-agreement, business-proposalMe and my brother have an idea of the brand new product that would solve one widespread problem among the smartphone users. But due to the fact that we don’t have required resources and opportunities to make that idea come to life, I’ve contacted the company that might be interested in my idea and would be able to realize that project. I described them the problem and explained how my product would be able to solve it and have provided its advantages over devices that perform the same function. The COO of the company has replied me and wants to discuss that idea together and ensured me that it would be under NDA. Since I don’t have any prototype of my device but only the pictures of its appearance and full explanation of the mechanism, what can I ask in exchange of my idea to them? I don’t have experience in such things. As a graduate I want to offer them my idea in exchange for a chance for me and my brother to work for their company and some percentage from the sales in case they decide to produce it. Does it sound possible? Should I include my conditions in the NDA? And what type of NDA should I use then? I don’t know what steps should I make now? I can’t afford attorney to help me with my occasion, but I hope that I will be able to get advice from you guys.
Thank you in advance!
Yes, I think in a way you can “sell” your idea in exchange for a position at the company and I have seen variants of this approach done several times. This is a form of what is generally called Intrapreneurship (https://en.wikipedia.org/wiki/Internal_entrepreneur.
If its your specialty then this should be a relatively senior position. In terms of profit sharing this is possible, however there may be other ways you can get additional compensation such as management by objective, bonus, commission on sales, overrides are a few examples. Do not get too stuck on what the compensation is called as this varies in what is allowed, just make sure you understand how and when you get paid when it succeeds.
There are some changes in approach I suggest based on experience that you should consider before you meet with the COO.
Firstly an NDA is needed, however what you must also have is a non-compete agreement so when you disclose your solution they cannot just do it on their own without you and your brother. If you search online you can get NDAs and non-compete agreements at a service such as LegalZoom.com or alternately you can get a freelance attorney on sites such as freelancer.com or guru.com. I strongly suggest you get at least basic professional input and that does not have to be very expensive.
Organize yourself, your brother and the idea so that you have a polished team presentation that is very clear in its value proposition to the company that includes financial impact, market detail and benefits for the company and the COO themselves. Examples would be quantifying the market value, size and potential revenue in solid verifiable terms, market research even number of google searches for the solution.
Additionally you need to be clear what is expected from you and your brother in exchange. A job can be mopping the floor, so you need to be specific including salary and employment level, term and negotiate what occurs should you be terminated for any reason within a given period. Becoming a VP of the division is pointless if you are fired in 3 weeks because they don’t need you anymore to complete the project. Be ready to negotiate this in detail when you give your presentation. This must be done in a written signed contract from the company.
I have also seen cases where the company does not want or need the individuals and instead makes a cash offer. Recently a peer trying to gain a position with a top app company brought them an idea and they declined to hire him and instead paid him $100,000 for rights and release of the idea.
I suggest you take the solution as far along as you possibly can before you see the COO. The closer you are to the solution the more valuable and lower risk your proposition will appear to the company. Screenshots, prototypes, written code all would help in establishing viability and value.
Have other options or alternatives besides this company. Research the competitors to your targeted employer, get the names of their COOs so that in your presentation you can say that you could take it to the COO at XYZ inc but wanted to give them the first chance at the solution. This is not a threat you are just making it clear that you have other options.
Finally as added insurance and a huge increase in negotiating leverage and value is i suggest you file for patent-pending on the solution.( http://www.uspto.gov/patents-getting-started/patent-basics/types-patent-applications/provisional-application-patent )
This is not that expensive, you can write it yourself and just pay the filing fee and it is sealed, filed for up to one year and the USPO does not review these whatsoever, so you will not be rejected. Do this even if you do not have the intent or means to file a full patent during the year.
When you present to the COO you can say that you have a patent-pending solution you want to give him in exchange for your participation. This is a very powerful approach and also discourages potential idea theft on the company’s part.
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