What are the disadvantages of stealth technology

Confidentiality vs. Intellectual Property Rights

How should start-ups deal with their business idea? Test the market as early as possible and reveal the competition? Or keep it secret and thus protect against imitation? What are the pros and cons of the two methods?

Confidentiality Agreement

Why is an employee confidentiality agreement required and what information can be protected? The following article provides answers about the protection of sensitive data in the company. Confidentiality agreements can be concluded with employees as well as with suppliers and beta testers, for example for software developments. Lawyer Alexander Bach, who specializes in confidentiality agreements for IT projects, therefore advises that you always precisely define the scope of confidential information. For certain information, such as that which has to be disclosed to a court or which is accessible to the general public or from third parties, exceptions must always be agreed. If an employee leaves the company, it is also necessary to agree on a subsequent non-competition clause in order to continue to protect the information from competition. The employer must make a compensation payment to the employee for the entire duration of the non-competition clause (maximum two years). Although the confidentiality agreement should always include contractual penalties, an actual violation is often difficult to prove in practice.

You can find the full article here.

Nobody cares about your secrets

The following article explains why start-ups should communicate their ideas early and not wait until the final launch of the product to involve the public. Most start-ups hesitate to show an imperfect and preliminary version of the product and fear that their idea could be copied. According to the article, however, many companies are missing the chance to get early feedback from potential investors, experts, etc. The needs and expectations of customers who can improve the product are also not taken into account in this way. The fear of start-ups that their business idea could be copied is unfounded, as the success of the product depends much more on the correct execution, good management and the right investors, etc. than on the unique business idea. In addition, large companies in particular are usually a lot slower in driving innovations and so do not pose a great threat to the start-up's business idea. It is also important for the company's public relations work to seek intensive contact with journalists at an early stage and to inspire them with as much information as possible for the idea. In some special cases, however, confidentiality can make sense, for example if a patent is to be applied for for a technology but it has not yet been fully developed.

You can find the full article here.

Pros and cons of stealth mode

Should startups keep their business idea a secret in order to surprise the competition or is it better to do a reality check early to detect reactions from the public and customers? The article presented weighs the advantages and disadvantages of the so-called "stealth mode". The main argument against secrecy is that recruiting is much more difficult, valuable input from customers is missing and coaching from experts is more difficult to get. In addition, important contacts are difficult to make Industry experts, such as Dharmesh Shah from Onstartups, are of the opinion that many companies only use secrecy as an excuse if they have doubts about their business idea. Main reasons in favor of secrecy are: The start-up can concentrate entirely on developing the idea and there are no costs for communication and service infrastructure before the actual launch. In addition, the public is only included when one has the convincing arguments and course corrections are also easier and easier more flexible, depending on the industry and business model l Basically, the costs and benefits of early communication to the public must always be weighed up.

You can find the full article here.

Looking for the patent recipe

The following article explains the points to be considered when applying for a patent and provides tips for patent applications for start-ups. The Munich patent attorney Ulrich Benedum emphasizes that a patent is indispensable insurance for inventors and entrepreneurs and can help start-ups to calmly let their ideas mature into a good product and business model. According to Benedum, the main problem for start-ups is timing: Many start-ups cannot afford legal fees at the beginning, but still have to protect the idea as early as possible. As soon as the innovation is publicly known, it is considered state of the art and can therefore no longer be protected exclusively. An alternative to the expensive application of the patent is only the secrecy (described in Articles two and three), which however often does not work in practice. It is also worth registering patents as a signal for potential investors, confirms High-Tech Gründerfond Managing Director Michael Brandkamp. Using the example of the fuel cell entrepreneur Sascha Kühn, it becomes clear which difficulties in particular founders with a technical background and without previous legal knowledge have. In 2003 he applied for the first patent as part of his doctoral thesis, but a process patent instead of a product patent. A decision that he would have made differently in retrospect, since process patents are easier to circumvent and abuse can only be recognized by looking at production.

More information can be found here.

With the kind support of the LMU Entrepreneurship Center

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