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Trusting Venture Capitalists (and Angels)

A reader once asked you a legitimate question about how an entrepreneur can protect an idea from being copied or stolen. You gave a very brief, even flippant, answer: "You could discuss it with no investors, show it to no customers and never hire employees…." [see: "Striving For Great Products"]. But what stops someone who has money from taking an idea from saying: "Great idea. I’ll do it myself. Thanks!"? This has to be one of the most fundamental problems someone with a new idea that isn’t patented faces. And every time it makes your column, you answer it in a sidestepping way. Is there a way to force a nondiscosure/noncompete agreement prior to presenting an idea or not?

Do you realize how hard it is to be flip? If it was easy, there would be more stand-up comedians. If you want a long answer, call a lawyer. If you want a real-world response, then read on.

What stops someone who already has the money from implementing your idea? Time, expertise and passion to name three factors. Venture capitalists don’t want to be entrepreneurs. They want to invest in entrepreneurs. They don’t want to do the work, they want to find people to do the work. The deal they want is: I give you money, you create something great.

By: Guy Kawasaki

Guy Kawasaki is an entrepreneur, author and the chief executive of Garage Technology Ventures, a venture capital investment bank for tech firms. He will provide expert answers to all your questions about starting a business.

Full Column: http://www.forbes.com/work/entrepreneurs/2005/06/16/entrepreneur-venture-capital-kawasaki-cx_gk_0616artofthestart.html?partner=moreover

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