Embaggen the cat, or let it out? (to NDA or not to NDA)


When first conceiving of a new startup idea, lots of entrepreneurs experience a measure of paranoia about it and start demanding that everyone with whom they discuss it sign a nondisclosure agreement (NDA).

My opinion is: Don’t use an NDA until you must in order to protect highly sensitive, non-public information. NDA’s protect actual secrets, not things anyone can just look up online or read about in the news. Once you’ve written some key code or developed a secret sauce that no one else has thought of, then consider assaulting people with an NDA, but not before. It turns people off. “Hey you important person, please come meet with me about this vague idea I’ve got for a startup, but first, sign here…”

The value of any company is not in the idea, it’s in the execution. Most people who learn of your idea will: 1. think you’re nuts; 2. not get it; 3. not care about it; or, at worst, 4. think to themselves, “wow that’s a great idea, I should steal it… hey look, a squirrel!” and do you no harm because they will not have your passion or commitment to executing on it.

I’d like to see more startups socializing or blogging or vlogging everything they do and think in the early stages of the company’s formation — every eureka moment and every crisis — and invite the crowd to comment and thereby build a community of devotees. Way more valuable and fun than a file full of NDAs that are useless to protect an inchoate idea.

As with most legal issues, your mileage may vary. Consult with competent legal counsel before deciding what intellectual property you should be protecting, and how.

The Company You Keep


With few exceptions, all business should be conducted from within a company that is properly formed and organized as a corporation, a limited liability company (LLC), a limited partnership (LP) or the like. Why? Four basic reasons:

a. Asset Protection. Deservedly or not, almost all businesses get sued. Forming a company around the business can shield the owners’ personal assets (and other business interests) from being attached to satisfy the company’s liabilities.

b. Asset Creation. A “d/b/a” does not a company make. If you’re doing business without a company, you’ve got an undifferentiated line of business that is difficult to quantify or encapsulate as a meaningful thing. Ownership of an informal company such as this means simply personally owning the personal assets used in the business. Since most assets depreciate over time, owning them has limited upside potential. And since you don’t really have everything tied up in a nice package, you don’t really have anything to sell to investors or acquirers. Once a company is formed, however, the company itself becomes a separate asset, which can appreciate in value over time and all or part of which can be sold to investors and acquirers.

c. Taxation. A company can be taxed in a number of flexible ways depending on the preferences of its owners. Without a company, all earnings are taxed as personal income.

d. Prediction. If you do not take the time to organize a company before engaging in business activities, the law may dictate that those activities have, in fact, caused a company to be formed for you! Unfortunately, it is quite unlikely to be the kind of company you would prefer. Get these things in order so you know what to expect and can command the results.

Forming a company is not just a conservative business practice. It is the first conservative business practice. Without it, none of the others really matter.

Corporate formation. Do it early. Do it often.

Bi-polar IP Strategy for Startups: Protect What You Can, then Tell Everyone


If you’re starting a company, you may wish to begin in stealth mode, keeping your business idea and plans secret for a little while. During this stealth phase, consider doing the following to protect your intellectual property:

  1. Think of a name for the company. Do a trademark search before you form a company. If it’s clean, form your company with that name and file a federal trademark application at the USPTO. Also file a state trademark application in your state.
  2. If you think you’ve invented something that’s never been done before, file a provisional patent on your inventions.
  3. Make everyone sign an NDA if they’re seeing your source code or learning your bona fine trade secrets (methods, or tricks, or other information that truly gives you a competitive advantage because you know it and no one else does).
  4. Make sure everyone — including you — who has contributed to your company’s inventions, know-how, brands, works of authorship, and confidential information signs an agreement transferring ownership to the company.

    THEN…

  5. Get the hell out of stealth mode! Go tell the world. Go public. Go social. Go everywhere. Tell everyone what you’re up to and invite their honest feedback. Crowdsource criticism.

It is true that only the paranoid survive. It is also true that the best way to keep something a secret is not to tell anyone else. No doubt about that.

But if secrecy of the business concept is your company’s only competitive advantage, then your business probably isn’t worth pursuing. If it’s a good idea, others will hit on it — in fact they probably already have — so your secrecy strategy is likely to be next to useless.

In the vast majority of cases, you can’t pitch investors while keeping the business idea a secret. Except in very rare situations, you can’t launch in stealth mode. On the other hand, an authentic revelation of your business idea to the public combined with a willingness to integrate their response into your plans, almost never fails to dramatically increase the value of your ideas.

So protect the IP you’ve got to protect, then give up the basic business concept and let the world help you make it better.

Copyright Duration: How Disney Moved the Finish Line


This post is excerpted from Ownability – How Intellectual Property Works, now available for pre-order at a 20% discount at myownability.com.


In 2002, Steam Boat Willy, the first major film in which the venerable Mickey Mouse character appears, was about to celebrate the 75th anniversary of its release. Under the copyright law in force at that time, which dictated a 75-year duration for copyrights held by companies, the copyright for Steam Boat Willy was set to expire on the 75th anniversary of its release.This would have thrust the movie into the public domain for all to copy and enjoy.

The copyright to Steam Boat Willy was (and is) of course held by the Walt Disney company. It is probably safe to say that the folks at Disney were troubled by the prospect of Steam Boat Willy’s entering the public domain. It could be argued that when Steam Boat Willy enters the public domain, the copyright on the Mickey Mouse character could be considerably weakened. Once the movie enters the public domain, it is possible that all imagery from the movie, including still shots of Mickey himself, could be freely copied without threat of infringement claims. In 2002, Mickey Mouse was threatening to join the ranks of Lady MacBeth, Robin Hood, and Count Dracula as characters in the public commons, and would thereby become freely available for anyone to use for just about any purpose.

The folks at Disney lobbied their local congressperson, who incidentally was (the now late) Sonny Bono of Sonny and Cher fame, to prevail upon him to prevent Mickey Mouse, an American national treasure, from entering the public domain. Congressman Bono thereupon presented legislation to the U.S. congress to lengthen by 20 years the statutory duration of copyright protection for works like Steam Boat Willy. And that legislation, now known as the Sonny Bono Copyright Extension Act of 2002, easily passed, extending the duration of copyright on works for hire from 75 years to 95 years.

Amid accusations that the U.S. had dipped from capitalist democracy into oligarchic plutocracy, Disney, a wealthy and powerful organization, commiserated with one of its own brethren, Rep. Bono, to cause the rules that govern us all to be changed to its considerable financial favor. Mickey Mouse was saved from the hands of the public for another 20 years. We shall see what happens when Mickey’s first film reaches its 95th anniversary in 2022.

One thing is certain: While there are those who dislike IP, few of them work in Hollywood or Washington D.C.

The Light Within


The word “namaste” roughly translates to “the light within me honors the light within you.” Beautiful, right? A really awesome way to view the world and everyone in it.

But what is this light within? Can we find it? Can we become the light within?

There are voices in your head, incessantly chattering at you. They narrate your day; they have an opinion about everything. Your parents are in there somewhere, I bet. And your exes. But mostly the voices are yours.

There are Oscar the Grouches in there too, always threatening to drag you into their garbage cans. They are the refuse from your life’s prior painful events. They are just about the opposite of the light within.

Your head is like the NASA control room at Houston, a roiling hive of frenetic activity replete with shrill, peripatetic voices competing for your attention.

You spend far too much time listening to the ravings of these lunatics. It is time to tune them out.

Somewhere way in the back of the control room, way in the back of your head, is the part of your mind that does not participate in these frenetic conversations, but merely observes them. Find that person. The one who truly isn’t part of the show, but merely watches it.

The light within you is the part of you that watches the show. The one who is aware. That’s the real you. The true self. The light.

You are not your thinking mind. You are the one who is aware of your thinking mind.

You are not defined by your emotions. You are the one who observes them.

At your purest essence, detached from the garbage in your mind, you are a bright shining light full of energy and peace and love and happiness. You are the one who observes with joy. You are the light within.

The true you, the light within, is the one with the power to objectify and detach from your thoughts and emotions. To become the light within, focus on leaving the show for a while. Don’t participate; just watch. Shed your thoughts and emotions and look at them from a distance. They are not you. They are some separate thing you can observe.

Cultivate the light within. Attend to it. Visualize it. Become it.

If you have never found the light within before, welcome to the new center of your universe! If you choose to, you can reside here for the rest of your life.

Hey thanks


The happiest people on earth have remarkably few things in common. One of them, however, is gratitude.

If you want to be happier, try being more thankful.

Your life is an amazing miracle, which, truth be told, you did absolutely nothing to deserve. It’s a gift, a daily birthday present, a sumptuous banquet set before you absolutely free of charge. Your only job is to accept the gift, to take the seat that’s been offered, and, well… eat, man!

The people in your life are all volunteers. Thank them for choosing you to spend their time with.

“When you’re born, you don’t come into this world, you come out of it,” noted the late Zen philosopher, Alan Watts. The universe made itself into you like an apple tree makes apples. That alone is worthy of worship, in my view. No deity required.

Your bad self is just a tarted-up dollop of the slime that grew on a rock adrift in the inky blackness of space some 4 billion years ago. Be thankful the universe is the kind of place that turns rock slime into you. Each day, be thankful that you get to spend another 24 hours on top of the rock instead of 6 feet under it.

You Don’t Need Anyone’s Permission


If you are considering entrepreneurship, nobody is going to come along and suggest to you that it might be a good idea. Certainly, nobody is going to give you permission. If you are married, your spouse is unlikely to say, “Hey, I know what you should do today. You should quit your full time job, take from our savings, and put it in a start-up company at great risk to us and our children’s future! Where do I sign up?”

Nobody who cares about your well being is going to suggest that entrepreneurship is a good idea. Because they know that chances are as an entrepreneur you are going to be worse off than you are now.

Financially, entrepreneurship is a lousy idea. Do it anyway.

Entrepreneurship is not easy. Nothing worth doing is altogether easy when you really think about it. No interesting questions are terribly easy to answer. No juicy problems are easy to solve. But the rewards are plentiful.

Entrepreneurship is tough. It requires energy, devotion, grit, gusto, and an enormous amount of work. Nobody is going to come by your office and suggest that you ought to do it, and if you ask, nobody is going to suggest that they approve, for the most part.

But, remember the choice is yours and yours alone. It’s your life. This is not a dress rehearsal. This is the show. It’s YOUR show. Only yours. You’re on!

You don’t need anyone’s permission to become an entrepreneur. Only you can write the script of your life; don’t let anyone else hold the pen.

Intellectual Property is the Ownability of your Own Ability


Excerpt from chapter 1 of Ownability – How Intellectual Property Works now available for pre-order at a 20% discount.

Intellectual property is everywhere. You can hardly exist in the modern world, let alone on the internet, without accessing or using someone’s intellectual property.

The rules of intellectual property help you turn ideas into money, which, at its essence, is pretty much the goal of any creative or innovative business. Most productive companies can be thought of as little machines that take ideas in one end and pump money out of the other end by turning those ideas into tangible assets that can be owned, protected, and ultimately sold for profit — a process enabled and governed almost entirely by intellectual property law.

Today’s so-called knowledge economy veritably demands a working knowledge of IP. In developed economies, the owners of a company – its shareholders – generally expect the company’s management to seize every lawful opportunity to increase the company’s valuation and reduce the company’s risks. Intellectual property law provides an array of options for achieving these goals. The wise entrepreneur should therefore obtain an understanding of IP basics and treat IP as an important component of efforts to maximize both company valuation and shareholder wealth.

Thankfully, of course, not all artistic endeavors have a business or money-making focus; plenty of IP is created every day that is never intended for sale or profit. But even these non-commercial creations are governed by the rules of intellectual property, so it’s a good idea for creators across the spectrum to become familiar with how IP works.

IP is the ROI on R&D – it’s the reward you get for investing in innovation and design. Effective use of IP can create substantial value. Any enterprise that creates, innovates, designs, invents, or advances the state of the art in any technology should consider protecting its creations, innovations, designs, inventions, and advancements by obtaining all available IP rights.

Aggressive, consistent attention to IP should be a core practice for businesses and solo artists alike. Creators of every size and flavor can use IP to fatten their valuation and thin their risk profile. Assets as prosaic as a brand name and a customer list can be protected by IP. Nearly every company and working artist owns such items and can use IP to protect them.

Of course, it may or may not turn out to intelligent or ethical decision for you to assert your IP rights against other people (by suing them) once those rights are obtained. But that should not stop you obtaining all the IP rights to which you are entitled. You can always opt not to sue people. But you never have a chance to decide whether or not to sue them if you neglect to obtain IP rights in the first place.

Ownability


Holy cow, I wrote a book. Check out Ownability and pre-order for a 20% discount!

Be a rockstar


I am a lawyer. I help people start companies and do deals. I try to be really good at this. In fact, I try to be a big effing rockstar.

Like they say, “Go big, or go home.”

Life is way too short not to supersize it.

My clients and friends know this. They’re all rockstars, too. And that ain’t easy.

We humans are stuck with some evolutionary baggage. We come from schools of fish and herds of animals for whom sameness is a survival skill and standing out from the crowd gets you eaten. So we have evolved a pleasure response to our own conformity. Fitting in to our peer group evokes a sense of comfort. Somewhere deep within our brains lies machinery that makes us really dig being part of the flock.

Choosing to be a rockstar requires unflocking. You need to overcome the visceral desire to just sit down, shut up, and accept the status quo like everyone else. You need to get up, stand up, scream and shout.

Be prepared for some criticism. Evolutionary disdain for radical behavior works outwardly too; we instinctively fear and loathe the behavior of our peers when it runs too far afield of the norm. And we have no qualms about letting them know it. This kinship-based weirdness suppressor is an evolutionary backup to keep us in line if we can’t self regulate as individuals. When people have too many different ideas, we think they’re crazy and we tell them so. Witness the very epithet “mad scientist.” Heck, witness how any group of teens treats a nonconforming peer. When Fulton proposed the steamboat, they called it Fulton’s Folly and they said it would never work. After all, why put a steam engine on boats when we’ve got reliable, centuries-old sails and oars? I have no doubt that when the first caveman tried rubbing two sticks together in an effort to make fire, the rest of us stood around making fun of him and suggesting he was the Devil. We have trouble conceiving of our own place in a world that is populated by too many crazy rockstars. Just ask the 19th century oarsmen that Fulton’s incredibly useful steam engine put out of work.

To become a rockstar, you’ve got to get used to haters and cultivate a certain pleasure in flipping them off. You’ve got to get yourself spending time around people who appreciate weirdness and smartness and boldness, who value your ideas because they are crazy and new. You’ve got to remember that pretty much everyone who ever said it couldn’t be done, about anything, was wrong.

Step 1 to becoming a rockstar is overcoming fear. It’s also step 2-10. So that means fishbrain avoidance from here on out, right?

You want to be a rockstar, but you’ve got this paleocortex in the back of your head insistently pumping out the signal that you are a fearful little ball of nerves just desperately trying to avoid getting eaten (because your paleocortex knows that you are crunchy and good with soy sauce) and pressuring you to stay inside the comfort of home and avoid the whole hornet’s nest.

Not much of a rockstar, your paleocortex. Best to move north.

‘Cause you’re also gifted with these highly organized electrochemical potentials in your cerebral cortex, the very newest part of your brain, which paves the way for all sorts of useful skills, such as choice. Such as choosing whether to supersize it.

You control the horizontal; you control the vertical. Let yourself become the star you are, star. Choose to be a rockstar.

Always go for the longshot, kids. Always go for the Hail Mary. If you miss it, that’ll suck, but everyone will forgive you because hey, it was a longshot.

But if you make it, well man you’re a freakin rockstar.