Got An Idea That Could Make You Rich?

Fortune Small Business:

A lot of businesses wisely secure partnerships with large corporations to help them refine, expand and properly market intellectual property. But it’s best to be cautious when you pitch your idea.

Just this week a woman sued Victoria’s Secret for rejecting a product she pitched them and then putting the product on the market.

“I’ve seen cases where small business owners without much money turn to large companies for help and then lose it all,” says attorney Ian Stock, of Entreprelaw in California.

But fear not! You can follow the many who have secured successful partnerships, so long as you legally prep yourself and learn to recognize the good and bad signs.

From a legal standpoint, you can protect yourself with a nondisclosure agreement. Ask the company you are approaching to sign it before talking to you.

“This is a relatively simple contract to protect the confidentiality of each side’s IP,” Stock says. “It states that you will not use any information you learn about the other party unless you are doing business together.”

Stock also suggests that when you do meet with the company, you present them with some of your technology as a first step, but not all of it: “Wanting it all at once can be a bad sign. The partner should understand that you want to establish a trust first.”

Still worried? “Sometimes it takes a leap of faith, but at the very least, look at the company’s history,” says Stock. “To a degree, large companies’ reputations precede them and indicate whether they play fairly.”

Finally, keep in mind that big companies often have the same fears that you do.

Photo by lclark.edu.

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