Ask HN: Don't want to steal an idea, but don't need 4 non-technical cofounders

17 points by mikeh1010 12 years ago | 16 comments

Basically here's the situation: I met this guy randomly at the bank, we discussed some business ideas we were each pursuing. He has an idea which I think is great, but requires a real web app - right now he has a website built with GoDaddy's website builder tools. That's about as far as he's gotten with the idea. No users, no working product yet.

I had a meeting with him where I told him that I had a ton of ideas for the business and I think I could build him the real web app he needs. I also found out more about how far he's gotten with the idea. He has 3 cofounders besides himself: 1 guy is in school for computer stuff, but not really ready for prime time yet. The other three (including the CEO who I talked to) are all undergrad business major types who work as tellers at a bank.

So HN, what is the smart AND ethical play here? I have the ability to execute this idea entirely by myself. These guys have zero ability to execute - no one on their team has any experience with web development, entrepreneurship, user acquisition, or anything.

I obviously don't want to just steal someone's idea, but I also don't want to split a company 5 ways when I'm the only one who is bringing any execution. What is a fair way to handle this? Even if the CEO drops the others and we split 50/50, I still feel like I'm bringing way more value than he is. I understand he could be valuable in non-tech ways, but I have no way to verify that until I see him in action. How can I structure a deal so that we both get what we really deserve out of it?

I know consulting a lawyer to set up a fair contract is key, and I plan to. Just wanted to hear if anyone else out there had any similar experiences and get some general feedback on ethics from a community of people who probably often hear business ideas they could execute better than the inventors.

tptacek 12 years ago |

Walk away. You'll have other ideas at least as good as the one you're looking at now, and a dispute over ownership is no way to start a successful company.

People will rush to tell you that ideas aren't worth anything and simply having an idea gives your erstwhile prospective cofounders little claim on it. That's true, but not dispositive. If you start your own venture based on an idea they believe they entrusted to you, there will be drama. You have no guarantee that the drama won't take a form that requires lawyers. Either way: it'll be ugly.

Life is too short. Do something else.

brudgers 12 years ago |

A few years ago, I was coaching my son's recreational soccer team. I wasn't involved in the all too common youth league shenanigans where coaches 'request' players and it was reflected in the average level of experience and athleticism of the children. Then again it didn't really occur to me to try. Anyway, against the odds the team advanced through the year end tournament and to all the way to the finals...of a U10 local rec league.

Because we were playing the most stacked team I decided that the best chance of winning would be to limit the playing time of the two weakest players - something I had not done all season. The kids lost 9-1, anyway.

Bad choices I made when I was young, don't bother me. Part of being young is not knowing better. This one was different. I went against being the kind of person I want to be, and asking myself "Is that action the sort of action that is consistent with the kind of person I want to be?" is for me the essence of ethical action.

I bring this up to point out that the idea you are thinking about isn't validated. If you're going to steal it, own the action. Don't pretend that bringing along the CEO guy with the website changes anything morally or ethically - injustice upon one person or two or three are all morally equivalent.

The worst case scenario isn't that the business fails, it's if you hurt people and it fails. You won't even have the ends justifying the means. It's fucking web app not a cure for cancer.

Keep a healthy perspective and good luck.

mynewwork 12 years ago | |

Off-topic to OP, but relevant to your story:

As a child, I was a very competitive soccer player. The only league available for me to play in was the local rec league, where everyone got roughly equal playing time and many referees, coaches and parents had a very indifferent "it's just kids playing a game" attitude.

I was constantly frustrated and frequently felt insulted that something I cared so much about (winning, and playing the game properly) was being held out of reach by the adults in charge. I wanted to play the game right and let the rightful team win, but was forced to lose games by well-meaning parents who apparently didn't believe 9 year olds had the same hopes, dreams and aspirations as everyone else.

So you may regret that the two weakest players on your team didn't get to play as much one game. But somewhere out there is a 10 year old who got to experience playing the game right, and even though his team lost the final 9-1, it was probably the best game of the year to him.

brudgers 12 years ago | | |

Locally, there's club ball, and that's where my son has been since that season. It was also the end of my coaching career. But a few months later I took up refereeing.and that experience has radically changed my perspective on the role of adults in youth sports, and in what you say about adult expectations making the game less fun is absolutely true. More typical these days is in the other direction - adults treating U10 game victory as worth a line on the tombstone.

But I see what you are talking about among referees. There's often a lack of presence for the kids. It's an ego thing. We all think we should be working the next level up and that it's ok to phone it in.

Anyway, some great youth sport resources are Bob Bigalow's book Just let the Kids Play, the Responsible Sports podcast and the positive coaching alliance.

http://www.bobbigelow.com/bobs-book-highights/http://www.bob...

https://responsible-sports.libertymutual.com/mediahttps://re...

http://positivecoach.org/http://positivecoach.org/

jesusmichael 12 years ago |

Picking good partners is key in business. I can't stress that too much. It is much more than a marriage, it's you're work and you'll put your blood and sweat into.

Call me ethically challenged, but if the idea is really so good that you believe in it. Go build the app.

Ideas are like farts... some stink some don't but they happen all the time.

If you build the app, you can go back to the group and say. Here I built it, I'm willing to share 25% with the 4 of you.

The notion that, because someone conceived a idea, it is his, is ridiculous. Lots of people wanted to fly with wings and a motor, but the Wright bros actually put in the hours to make it so. Ideas belong to the people who bring them to life.

You have more leverage here if you have the working prototype in your hand.

And no one is going to sue over an idea for a business that doesn't exist.

rholdy 12 years ago | |

'Ideas belong to the people who bring them to life.'

-- This. A million times. This.

throwaway420 12 years ago |

Unless you're planning on hiring the Inception people and literally erasing this idea out of their brains, you would never be stealing their idea - you'd be copying it. They still have their original idea and can build anything they want based on it.

You should probably talk to the founder about this issue first.

If you feel bad about this situation for any reason, you might consider hiring them to do some consulting work for you on this project, whether now or some point down the road. This provides just some of the following benefits...

* An extra learning experience for them where you can set them on the right road to performing some tasks they otherwise never would have thought of * some extra compensation that they would have otherwise never had an opportunity to get * an opportunity to really gauge their competency and see if they can have a major future role with you.

b_t_s 12 years ago |

Walk away. If you want to be a good guy, walk away and do something else. Besides, it sounds like the idea has zero validation. That means your gut feeling that you can connect with significant numbers of customers who want this thing and are willing to pay you meaningful sums of money for it has a pretty high chance of being completely wrong.

As far as having 4 idea guys as cofounders, that's my personal vision of hell. I've been in that situation with one designer and one idea guy just doing a couple of iphone apps on the side for fun. It quickly turned into general unpleasantness all round as our idea guy, having nothing useful to do, busied himself with being Chef Executive A$@hat. You've got 4 of them? shudder I'd probably turn that down even they had funding and paying customers.

CyberFonic 12 years ago |

Draw up a project plan with staged payments. Ask for an advance, etc.

Yup! Money NOT equity! Just charge market rates for your work. With 4 cofounders they should be able to finance "their idea" - hey they work in a bank ... dhuuh!

If they don't want to play on your terms, then it is better to find out now. One tech guy vs four biz types - just can't end well. No contract will totally protect you and good lawyers don't come cheap. Cheap lawyers end up costing even more in the long term.

dirktheman 12 years ago |

Be upfront. Tell him you like the idea, but you don't like to feed another three mouths who bring nothing to the table. Tell him you want to continue working on the idea, and make clear terms what he will do regarding getting users and doing bizdev. Don't split it 30/70 (since you're doing all the work now) but rather keep it 50/50 to eliminate friction.

akg_67 12 years ago | |

I second this idea. Just talk to the other three mouths. Ask them what they are bringing to the table, what their contribution will be, how they will add value and how they should be compensated.

User7198 12 years ago |

You take the idea and you execute it solo. If you succeed, and they fail, it's not because you stole the idea, it's because of your execution, and you pat yourself on the back for a job well done.

If you want to smooth things over, talk to him and say you like the idea, but see things a little differently, and are going to take a shot at the concept on your own.

The chances of succeeding are extremely slim, so don't lower your odds by carrying 4 people along as dead weight as you do all the work.

rholdy 12 years ago |

Build it yourself. If it takes off, hire that dude to work for you. If his buddies are worthwhile, hire them too.

Sitting around dreaming shit up in no way qualifies someone to run a company.

mirador 12 years ago |

Just be upfront about this situation. Come up with a cap table that includes everyone that brings in non-zero value, and fairly allocate equity based on what each individual brings to the team. There's no reason to split 50/50 if 2 people are not contributing equally, might be closer to 95/5. Make sure you can defend any equity amount based on objective reasons.

metaphorm 12 years ago |

ideas are a dime a dozen. execution is what matters.

if you think the guy you met will be signficant value add to your ability to execute on the idea, then obviously include him. it sounds like he and his team are not really going to be able to add a lot of value though. don't weigh yourself down.

adidash 12 years ago |

Sounds like a scene from "The Social Network". Your move!