Planning, Startups, Stories


Tim Berry on business planning, starting and growing your business, and having a life in the meantime.

Q&A revisited: Really, How Do I Sell My Idea to a Big Company. Part 2.

Irony: This post from about a year ago explains why you can’t sell an idea to a large company, and recommends not even trying. And dozens of reader comments ask how to do exactly what the post itself says they shouldn’t even try. And I get more comments all the time, plus emails on my ask me form, asking how to sell the idea to the big company.

Pot of Gold shutterstock.com

So I give up: Please promise me you’ve read this post before you go on. Know what you’re up against. Don’t be naive. Selling an idea to a big company is a one-in-a-million shot. You are probably wasting your time. But if you insist, here are my suggestions.

Step 1: Develop idea ownership

  1. Drill down on whether or not your idea is patentable. Patents are for inventions, not ideas. You either consult an attorney or do the research yourself. It’s a tough subject because it’s not what you think it should be, it’s what the real world and the beaurocrats do. And having a patent isn’t enough; it has to be a good patent, that protects against work-arounds, and will hold up in court. And a patent is something you can own. And sell or license.
  2. If you can phrase your idea as a creative work then you can protect it with copywrite. That’s for books, songs, recorded performances, software products, films, television shows, paintings, and so forth. That’s protection, and ownership, but it doesn’t mean you can prevent people from copying you. If it’s good, they will.
  3. The other way to own an idea is to build a company over it. We call this general are one of trade secrets. It’s like the classic secret sauce. You bottle it, sell it, and hope imitators can’t reproduce it. So you can approach that target big company as a business already selling something, instead of just an individual with an idea to sell. Yes, that takes work; but your odds of success are much better.
  4. It won’t hurt to periodically write your idea down on paper, describe it as best you can, and mail it to yourself by certified mail. Do that whenever the idea changes. If you do, then at some future date, if you’re in a dispute, you can open that registered and sealed mail in front of a judge to prove what your idea was when. But don’t trust this protection very much: having an idea first doesn’t mean you own it.

Step 2: Get an attorney you trust

You need an attorney. (Note: I’m not an attorney; I can’t give you legal advice; I’m sharing my non-attorney experience as a business owner). Although non-disclosure (NDA) and confidentiality agreements are slim protection against big companies, it’s still better to have them than not to have the protection they offer. And an attorney you trust.

Step 3: Approaching the big company

I have to admit, I can’t tell you how to do this; I’ve never heard of anybody doing it successfully.

In theory, companies have some system for managing these contacts. Visit their website, call their main phone lines, investigate and explore. I do know that companies vary widely in how they deal with suggestions. Some have web forms. Some have employees. Some have a wall that’s hard to penetrate. And maybe there’s some that sift through ideas with interest and respect.

Often, finding the right person to talk to within a big company is like a reverse telephone tree. You start calling phone numbers available. With each call you make, you ask who’s the right person to talk to. With each new person who puts you off, you ask for another suggestion.

Step 4: The great beyond

If you find yourself actually dealing with that big company, pitching your idea, wow, I’m impressed; and you’ve already done the impossible. I hope you have a good attorney. I hope you succeed. My advice is be extremely skeptical and extremely cautious.

 

  • And now, three years later, what have you learned? Did asking someone else work? Did you find somebody to act on your idea? Did anybody pay you?

  • Marston St. John

    I have a question that goes past step 4. My husband invented a very cool manufacturing system and was able to have it reviewed by the giant company that would best produce it within 2 months of his patenting it. The company is in Switzerland and they translated the patent into German. Their R&D was clearly excited about it and told him (in writing) that it can be made. Then, suddenly, R&D went silent for 3 weeks (I’m assuming this is due to legal). They then replied that they were not interested in purchase at the moment, but would contact him in the future… wtf does that mean? We have the US patent since 6/16 and our lawyer has advised we file a PCT in March/ February… any thoughts? Thanks!

    • @Marston, Obviously I don’t know what’s really going on. I assume you’re worried that your giant company has decided to get around your patent, and I would worry about that too, if I were in your situation. I suppose they might have decided the business opportunity wasn’t worth it to them, not to work around your patent. Time might tell, but also you might never know. This is why my advice above includes have a good attorney and be skeptical. Giant companies don’t always operate ethically.

  • My idea will help home’s from burning down adjacent to other homes & forest fire’s…

    • ???????????????? WHAT,FORGET ABOUT IT I’LL ASK SOMEONE ELSE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!