Launching a Product - How do I protect my idea while selling it?

Hello, my name is Ian Peterman. I'm CEO and founder of the Peterman Design Firm, and on today's episode we're going to talk about how to sell your idea to a company without them stealing it. And that's, you know, whether you're going to sell it, license it, or even work with the company to co-develop a product. What the first thing, and I know we talked about it in other videos, is get an NDA. Always have an NDA. Now, the caveat to that is that when you're pitching to companies, quite often they will not, you know, depending on who you're talking to, they may not actually sign an NDA because they expect that if you are pitching to them, your product is patented or it's in the market already and you already have market ownership. So think about how you're pitching, think about who you're pitching to. And if an NDA is not possible, the next level that you can do is, and even if it is, get an NDA. I always recommend to my clients, if you are in the physical product development world, And it's something that you don't need to keep everything proprietary. So if you're, you know, if you're wanting to develop it further and wanting to work on it more and really don't— you can't share to anyone, and that's, you know, whether it's because your product, you believe that if you were to share it, there's competitors, if you are in a highly competitive space, you probably don't want to do anything until you're ready to launch. That means you don't even file a provisional patent, you don't file a patent, you don't do anything until you're ready to launch. Make sure you do all the research, make sure that you're going to be able to file a patent, make sure you're in a good position, do all the development, prep all the manufacturing, use NDAs for everything and everyone. But then it also means you're not pitching. So if you're trying to sell the idea then you need to have it protected in some way, shape, or form. And that comes in either NDA, if company is willing to, and, you know, some brands, they don't. They're not gonna really do an NDA with you because they literally get pitched ideas for free. People send them ideas all the time. They don't need— they're not gonna sign an NDA just for you. An idea isn't that special to them because there's billions of ideas, billions of people, billions of ideas, and they're submitted constantly. So you got to think about where you're at and who you're talking to. And the way you can protect that is by getting a provisional patent. That's something that a lot of my clients have used before. They get a provisional patent, they start that process. That way they show that they're serious And then they show, you know, the prototype or packaging or mockups or whatever it is, and they sell. And that's how you pitch, and that's how you protect. Those are really the 2 ways. You know, this is going to be a really short video because it's really the only 2 ways that you can protect your idea that way. The other way, which isn't legally as much protecting, but it is in a way, is that If you launch the product, if you actually go take it to market and you just get it to market, you're first to market, then that gives you a competitive edge and it'll give you something. So you're already selling a product, then you probably don't need protection. You're not going to need to protect it from being stolen because you are first. And so you'll be able to show whether somebody rips off your design or not. In that case, you can look at like design patents or other kinds of things. Even depending on what you're trying to protect, trademarks can be helpful, things like that. You know, and this is all— once you get into the legal side of things, get a patent attorney, get a trademark attorney, talk to them, at least talk to them and make sure that you are— they're aware and can— of what you're doing. And so they can advise you in an exact strategy. But if you're already producing the product, that's a great place to be in because it's gonna cost more at that point for the company to try to steal your idea than it is for them to just buy or license it from you. And so, and the reason for that is in order to steal the idea, they have to reverse engineer what you're doing, create an identical But a little bit different so that they can try to avoid any potential litigation, right? And you can still start a legal battle with them, but they may change it, especially if they're, if they're smart. They'll change some pieces of it, but then they have to go through the design process, then they have to get their own tooling, then they have to produce the product. And they have to hope to sell. And now they're actually behind because you have the customers. You may not have all the customers. You probably don't have all the customers. That's why you're trying to sell it. But you do have some customers and the value you bring, like you, you have just done 2 years of work, you know, or 6 months, whatever you spent, but you spent time in developing, securing customers, proving that the market wants it. And selling the product. And that is a package. When you get to that point, that is the perfect place to go try to sell your product, because you're not just selling a product, you're selling a brand, and you're selling a customer list. You know, another— you're selling their contact information. Don't sell that. Don't be one of those people. But when another brand buys your product If you aren't producing it still, then you aren't a competitor, which means all of your customers are going to have to go to this company that's buying your product to buy it. And so what you've done is just collapsed their R&D time, which at a company they would estimate it, you know, 12 to 24 months is a pretty normal R&D period in order to get a product development and get it to market. And then you're adding on however long you've been selling it for. Which putting all that together into a nice little package for them, you don't need to protect it. I mean, you can try to, but if you're already selling it, you're already out there, which means anybody can steal it. So you need less protection because your protection is the fact that you have a customer base, you have a product that's in production, you have tooling, you have hard assets that are actually valuable. And to a potential buyer or licensor, when they're going to save all the money, that's the reason that they offer to buy products. And there's a reason that they offer to license products often, and it's the highest chance that they're going to do that is because you've done all the work for them. You've done the hard work, you've proved that it's worth a worthwhile product, and they're going to buy it. So, you know, in that, in that format, You don't even need an NDA. You don't need anything. You can say, here's my product, here's my sales, here's, here's where this is at, this is what I want for it. And you're, you know, from there, negotiation details, probably get an attorney, especially if you're dealing with a larger company. Make sure that you still have a good deal at the end of the day. But you have such a valuable package, and it's going to take months and months and months of work. If not years of work to duplicate what you're doing. Even with a big company, they can move fast when they want to, but it doesn't make for a good name if they just constantly steal everybody's ideas. And it's a lot of work to do that, more work than just writing a check saying, I will purchase this, and then they'll blow it up. You know, that's why Disney didn't try to create a new Star Wars. They bought Star Wars and then they dumped tons of money into it and are making a lot more money now from it. So that whole like purchasing something and acquiring products and IP. So the other way to make that extremely valuable, and I know we're digressing a little bit, but have IP, make it more valuable, make it a sweeter deal, and they'll want it. So I hope that helps and gives you some information on how you can sell your product to a company with, you know, and keep it protected and not have it just stolen.