There’s an article in the February issue of this magazine that so perfectly captures why I believe it is crucial not to give anyone reason to work around you, I had to write about it. Every inventor’s worst fear is having his idea stolen from him. I don’t think ideas are stolen very often, actually. I do think they’re worked around. That distinction is important. Let me explain.
As the author of the article effectively clarifies, there’s a significant difference between simply having an idea and actually executing on that idea. “It’s not the idea others covet so much as what you make of it. An idea is a spark. No one wants your spark. They want your flame,” Inc. editor-at-large David Whitford writes. I agree. If you want your flame to stay yours, or at least profit from it, adopting the right attitude is a must.
I’ve experienced more or less the exact scenario the article describes, which is this: You come up with a great idea. You work hard to develop it. And just when success is right around the corner, a more powerful and established company swoops in to take the market right out from underneath you. The injustice!
What caught my eye was this. Like me, Doug DeAngelis, founder of Lynx, had an opportunity to sell. In fact he had many opportunities. But he chose to wait for a bigger payoff. “You don’t want to sell your business until you’ve proven the value in what you’re doing,” he is quoted in the article. I felt the same way.
Many years ago, I licensed my technology to a powerful company. That company then sublicensed the technology to another company located outside the United States. A customer with enormous potential was intrigued and got in touch with the sublicensee, but ultimately negotiations were called off because the price was too high. A year and a half later, what was once a potential customer started selling a similar product around the world. I chose to go to Federal Court to defend my patents.
I would choose differently today. In fact, if I could do it over, I would make every effort possible to understand potential clients’ desires and supply them. Why? Although we eventually settled, the process was extremely lengthy and taxing. In hindsight, I was too far removed from what was going on.
The advice I give my students today is, don’t give a company reason to work around you. Sometimes it really is that simple. Focus on the big picture. Have a great attitude. Be extremely flexible. In short, make it easy for them to work with you. Make it desirable. Make it so the obvious choice is to work with you. If an offer is too low, there are things you can do to add value.
As Dennis Ceru, founder of the CEOs Group executive leadership program and an adjunct professor at Babson College, is quoted, entrepreneurs often ignore the “nuisance factor, which comes into play when a potential buyer is big enough to enter the market without you.” If buying you is more of a nuisance, he warns, the value calculation changes to your disadvantage. I think that bears repeating. The nuisance factor is real — very real. Recognize it for what it is. When you’re a smaller player, you can’t afford to forget it. The fairness of it all isn’t relevant.
Of course, Lynx has sued. Who knows what will happen in court? Years will pass before we find out. In the meantime, Lynx’s former partner has surged ahead with a partnership with the NFL.
Sometimes we’re too close to our projects to see the writing on the wall. I could have benefited from bringing in an independent third party to give me good advice. I should have stayed in closer touch. But I also learned a priceless lesson, which is that not every deal is going to be perfect — that there’s value in lowering your expectations, cutting your losses, and moving on. The art of negotiation takes many forms.