inventing & intellectual property

Discussion in 'Off-Topic' started by strantor, Sep 23, 2013.

  1. strantor

    Thread Starter AAC Fanatic!

    Oct 3, 2010
    I have some ideas for products that I think would sell in my industry, but I haven't tried selling them because, well, I guess I don't have a valid excuse, but the excuse I most often cite to myself is that I don't have a customer base, nor do I have the salesmen or marketing gurus needed to create a customer base.

    But the company that I now work for, does have the customer base, the salesmen, and the marketing gurus. I've talked with the president of the company enough to have a pretty good handle on the type of guy he is. I think he's the type of guy that sees potential, and acts on it. He makes educated gambles and has a very good track record of betting on the right horse.

    The company that I work for does not manufacture their own goods. We sell and service goods from manufacturers which we have contracts with. But we dabble in all kinds of areas. There really isn't a direction that we aren't expanding in, except for selling our own branded products. If I am any good at predicting the future, I suspect that that is the next step that the president would logically pursue, even though he hasn't announced any intention to do so.

    I am thinking that if I presented some of my ideas to him, he might actually consider them.

    I don't know if this is good news or bad news. On the one hand, I want to be the one who capitalizes on my ideas, but on the other hand, I don't think I have the resources to do so. So if I keep my ideas to myself, I might as well take them to the grave.

    BTW I signed the standard employment agreement that states that anything you invent while employed at XYZ corporation becomes intellectual property of said corporation.

    I will be spending some time with the president this week, and the course of action that I have tentatively decided to follow, is to first ask him if he has any interest in one day branching out into manufacture of goods. If he says no, then I will ask for his blessing to attempt design, manufacture, and sale of my ideas independent of the company. If he says yes, then I will pitch my ideas to him, and if he isn't interested, then, again, I will ask for his blessing to attempt design, manufacture, and sale of my ideas independent of the company. If he says yes, and I pitch my ideas to him, and he does seem interested, then I will proceed to ask how I would be compensated for the ideas. ....but here lies the stressful issue for me! What if he says I won't be compensated? I don't really think that would be the answer, but what if it is? I've already spilled the beans! How do I recover? What if he says he's not interested, AND I'm not allowed to pursue it on the outside?

    What advice could you give? should I just keep it to myself? How should I handle this? I'm not content to sit on my ideas any longer. I feel like in the future I will regret not acting on this.
  2. MaxHeadRoom


    Jul 18, 2013
    But this is only if you develop something while paid in the course of your employment.
    Anything you develop in your own time especially if not allied to any of the companies present products do not apply.

    I was in a similar position, I developed a product in my own time, the Company was not interested in manufacturing this anyway.
    As to protecting the invention or development, it could be lucrative for you to produce small numbers that may be a limited market, whereas a Large company is not usually interested in R&D and producing a product that does not have a sufficient sales potential.
    If you at all suspect he is not interested, I would persue it outside of work.
    You could always feel him out tentatively without releasing any details maybe?
  3. killivolt

    Active Member

    Jan 10, 2010
    I am an Inventor, you poses the skills knowledge and ability, like many that are in our country and abroad.

    Not all, not even some become a product. We want them to be but, still somehow we are to early or to late.

    Then some are just right, when in the employ of a company. You are there intellectual property and as such fall under their rights and possession. Many lawyers will argue, without the company you would not have come to, knowledge to create something of importance.

    e.g. So, if they can show your intellectual property and say you collected your intellectual knowledge, from the company and it's. So, call property.

    What happens in Vegas, stay's in Vegas.

    Once you sign off, thats it.

    It belongs to them, without competition.

    FYI, just my opinion.

    I really hope someone can say different. But, I made a company over 50 million and got the boot.

    I can go on, but it's to unbelievable.

    Just saying, if it's to good to be true. Don't fall for it.

    My trusting Father improved on a design, it was mechanical defuser. The company and the rep, gained a product from my fathers intellectual property.

    A handshake deal was lost to the company. They exploited and built the company around it.

    Just saying, be watchful and alert.

    Last edited: Sep 24, 2013
  4. bountyhunter

    Well-Known Member

    Sep 7, 2009
    Not necessarily. In some cases, it's anything similar to what is made there or could compete with their products. Ask any designer who ever worked for a semi company. When they leave a semi company and start their own, the previous company would sue claiming the ideas for the new devices were thought up previously while they worked at their former company.:(

    In many cases, there is a time period that has to expire before allowing new competing ideas to be brought to market.... and somebody always sues anyway.
  5. sirch2

    Well-Known Member

    Jan 21, 2013
    You are better off with 30% (or 20% or 10%) of something than 100% of nothing. I think you are doing the right thing in talking to him. A lot of inventors overlook the cost and value of sales and marketing that you have rightly identified this as critical.

    The guy would have to be a real schmuck to just take your ideas and give you nothing in return but expect the return to be sales based and expect to work hard to get it.
  6. JoeJester

    AAC Fanatic!

    Apr 26, 2005
    I'll assume you have some contemporaneous records of your inventions dated before your meeting.

    If your boss doesn't have a plan in place, help him write one, where the "inventors" are compensated for their inventions. If the company is going to assume all the risk, marketing, and liability for your invention, you might not want a large piece of the pie. Maybe you can share in the risk by taking a percentage of the profits, or you can give all your rights for some compensation.

    Don't sell yourself short on the compensation. After all, you should know what your hourly rate is ... or would like it to be. Even if you multiplied the company's hourly rate by the time you put into the design and prototyping, would that be a fair price?

    Don't leave out any time you've thought about that project ... even if you were multi-tasking in the shower.

    You have a substantial investment of sweat equity in your invention. If the owner can't recoup his expenses (including your compensation) within a reasonable time, he might not want your product. So, hopefully you will have figured out enough sales for the idea from the existing customer base, to make it worthwhile.

    Good luck and keep on inventing.
    killivolt likes this.
  7. Sensacell

    Senior Member

    Jun 19, 2012
    Make a deal with your boss that circumvents your employment contract beforehand, get it in writing, then tell him all about it.

    Just because you work there doesn't mean you cannot cut a new deal, it depends on how good of a negotiator you are.

    The hardest part is convincing them that you have something good enough to bother before giving the idea away.

    Don't be greedy.
  8. THE_RB

    AAC Fanatic!

    Feb 11, 2008
    I think you just described a company president pretty well? :)

    Strantor, you need to remember that a CEO's job is to make the absolute max for the company, and maximise company profits, while paying you the minimum possible. It's his JOB to screw you on this, and he would be negligent to pay you handsomely (and could even be forced to resign etc). His job responsibility is to maximise company profits, not to be a nice guy to you...

    I would develop the product on your own time, in secret, under some new little company name. Then when you have a nice working product you bring their attention to it; "Hey, there's this new product which I think we can benefit from adding to our sales line!"

    Then your little company can negotiate whatever best price it can get (as CEO, YOUR job now is to maximise YOUR company profits) so you get your product added to their line in a way that pays you max return.

    You are not morally or legally obligated to tell them you are associated with that little company, frankly it's none of their damn business. :)

    I've seen this done a few times in industry. Someone identifies a need, makes a product, starts selling it back to the industry, and usually makes so much money they very quickly quit working for a wage and focus on their new business.

    One example; a guy was working in the small electrical motor rewinding shop, that was struggling to keep up with their own repairs for a large industrial operation, and the management did their job and refused to employ more people or pay good overtime, instead they demanded the few guys there worked like slaves on the (low) fixed wage. Some motors started to be sent out for expensive repair by private shops.

    One guy left, started a "motor rewinding" shop from his own premises, and with the reduced labour in the industry shop they were even more forced to start sending motors out. The result was that he was now doing a casual 2 motors a day for $150 each, instead of slaving like a dog all day doing MANY motors and getting mininmum elec wage (which was about $400 a week in those days). Do the math. :)
    Last edited: Sep 24, 2013
    killivolt likes this.
  9. t06afre

    AAC Fanatic!

    May 11, 2009
    It is important to get any agreement on paper what so ever. In your case it could be a "Non-disclosure agreement" Just use google and you will find a lot of examples. If I if i was in your shoes. I would have tried to create a good working prototype, if it is possible of course. Before talking to anybody. This will strengthen your position in any negotiation considerably.
  10. strantor

    Thread Starter AAC Fanatic!

    Oct 3, 2010
    I don't disagree, but it should be noted that this is a privately owned company; there are no shareholders, so the president is at liberty to do whatever the heck he wants, without permission from anyone. He has a history of being very generous towards employees and being fair. He strives to make this a place where people WANT to work. So, at the risk of being naive, I tend to think that he would not go out of his way to screw me over.
  11. Brownout

    Well-Known Member

    Jan 10, 2012
    To paraphrase Regan, trust but make sure you are protected.
  12. killivolt

    Active Member

    Jan 10, 2010
    Playing on the safe side, at least a Non-disclosure doc, to show your not naive.

    If it's really worth that much, do a poor mans patent. Also, get a patent pending.

    But, in the end. I've been a trusting soul and would rather do a handshake deal.

    Maybe you could just say out of the box, like MrAl. I have an idea, I would like to present it to you. If you can do a good ROI and know how many somethings you could increase sales, or the company can benefit either cost reduction of a current product, or a hole new line. Ask, would their be any compensation for limited intellectual property, acknowledging you wouldn't have come up with an idea, were it not for your recent employment with the company.
  13. strantor

    Thread Starter AAC Fanatic!

    Oct 3, 2010
    I've made references to my ideas before, as part of public record. Some even on this site. It would not be any trouble to provide evidence of the existence of the idea, even the assembled prototype, before I came to work here. I consider the "poor mans patent" to be already on file.
    killivolt likes this.
  14. killivolt

    Active Member

    Jan 10, 2010
    AAC's got ur back:)
  15. tracecom

    AAC Fanatic!

    Apr 16, 2010
    My only advice to you is, "Don't lead with your best pitch." Start with a lesser idea, and see how it works out. The best new product idea I ever had is patented with my name on it, but my former employer owns the patent.
    Last edited: Sep 24, 2013
    strantor and killivolt like this.
  16. Papabravo


    Feb 24, 2006
    Don't take another step until you read Lancaster, D.,The Case Against Patents

    In short "if you want to get screwed -- act like an inventor", otherwise "act like a businessman". There is no other way.
    Last edited: Sep 24, 2013
  17. loosewire

    AAC Fanatic!

    Apr 25, 2008
    S.C.O.R.E. a government sponsored agency that advises on patents has speakers

    that have become famous for Inventions that you use ever day. The speakers

    always say that they will not give you a non-disclosure agreement ,it just don't

    happen unless someone is to do a go around on you. One of the most famous

    was the creation of F.M. ,can you imagine A.M. on your T.V. sound . R.C.A.

    went to congress and had the law changed to steal F.M. . There are many ways

    to steal your Idea. The best suggestion I have..........I am doing myself ,if it works

    out I will be happy to let you know ,not for money...just to beat the system. The

    computer and u-tube and other systems have made it possible.
  18. strantor

    Thread Starter AAC Fanatic!

    Oct 3, 2010
    Well I hadn't mentioned anything about perusing a patent, but I appreciate the tip nonetheless. I was well aware of the facts that Lancaster highlighted, but it's good to re-read it. So far I'm following his steps; on step 4:
    The only thing I'm off by, is the part in red. He doesn't explain why you don't approach the firm, nor does he address my situation, where you already work for the firm. An idea what the reason is behind the words in red?
  19. Tesla23

    Senior Member

    May 10, 2009
    Your boss may be a nice guy, but business is business and he didn't get to own his own company by being generous to everyone.

    When you tell him your idea, the main question from a business perspective is how much does he need you to do it? This is your bargaining chip. On the flip side, the question you have to answer honestly is how much do you need him? If you didn't need him you would have probably left and be running your own business now.

    If you present him with a proposal that shows him that he will get a good return from what he brings to the partnership, and you get a comparable return from what you bring, then you are in with a good chance. You need to understand the business side and there is a tendency for engineers to think that having an idea is 90% of the value and providing the access to finance, manufacturing capability and access to market is only 10%, whereas probably the opposite is typically true.

    If you have a good grasp of the business side, prepare a business case and present it. Before you do, look at it from his perspective, and replace you (and your profit share) with a non-profit sharing employee (your replacement) and see if he makes more money. If he does then you are on shaky ground.

    If you think you will be relying on your perceived ownership of the IP, I'd pretty well ignore everything said here and get legal advice.
  20. strantor

    Thread Starter AAC Fanatic!

    Oct 3, 2010
    I really don't suffer from this disillusion. As I alluded to in the OP, I do realize the greater importance of the resources that he has, in comparison with the relatively useless idea that I have. I'm not trying to get rich... well, maybe I am; who doesn't want to be rich? But my main goal is just to see people using goods that I designed. That would make me happy. And I would like to make some money at it as well. The link I referenced above mentions 5%; you mention 10%. I'll go with 5%. If my invention turns out to be a million dollar idea, that's $50,000 that I didn't have before, and probably $50,000 that I never would have made on my own. I would be happy with that.
    That's what scares me. I don't think he would so quickly dispose of me unless he didn't see any more money making ideas coming from me in the future. I would think that, using the numbers above, $50,000 for a million dollar idea is a small price to pay, especially with the promise of more to come. I figure, It isn't until it gets closer to a billion dollar idea that my 5% starts to represent low hanging fruit, targeted for picking. Getting rid of me over 50K would be a waste; not to brag, but I'm a really good technician and they would have to go through a handful of replacements before they found the right fit again.