Starting a business with partner who works in corporate america

[a_lifters_life]

Can anyone explain their successes and/or failures they might have had while working with someone who works for a company while trying to formulate a successful business and work on a product?

 

I am working as the sole developer of the product while the business end lays in the hands of someone who is married (without kids yet), and works f/t for a company... while I'm in school and still devoting every free moment to the business.

 

I am in school full time (senior) as a co-founder in a startup programming the core product offering. The other cofounder is married and has a fulltime job.

 

What are some of the consequences of this, what concerns should I have if any?

[chitown9]

 

What are some of the consequences of this, what concerns should I have if any?

 

Well, I think one thing is obvious: your business partner will be unable to work as much in this business as you will.

[londonbridge]

Well, you should definitely check to see what the company policies are with the guy working full-time. Some companies, like Google, have policies in place where you can't work on independent projects outside the company, AND if you do, the idea belongs to them, not you. If you think you can do this on the lowdown now and aren't worried about it, it might come back to bite you in the butt, if say, your project becomes successful and paperwork needs to be done, and Google finds out about it later on because they want to buy your project, but woops, turns out, Google actually owns it. Lawsuit.

 

Some companies want their employee working fulltime and soley on company projects, and you cannot use your energies/or run your own side business while you work for them, or you're fired.

 

There are lots of good advice on the internets. Search for entrepreneur blogs, magazines, leaders online and offline. I think you'll find more useful detailed information from those places, and within business/entrepreneur forums, than on enotalone, which is more geared towards relationships than technology and business.

[londonbridge]

Oh, definitely try link removed. A bevy of smart insiders from the tech and entrepreneur world who'll be happy to answer your questions, and hey, a good spot for networking if you're going into those fields.

[Ariel85]

I think you're ripe for being screwed over. If you know nothing about business, I strongly suggest you educate yourself first before giving someone access to your product. You're in a prime position to be taken advantage of from what it sounds like.

[a_lifters_life]

I think you're ripe for being screwed over. If you know nothing about business, I strongly suggest you educate yourself first before giving someone access to your product. You're in a prime position to be taken advantage of from what it sounds like.

 

why do you say this? elaborate?

[Ariel85]

why do you say this? elaborate?

 

It's pretty self-explanatory.

 

As I said, if you know nothing about business, as you admit, then chances are that this partner can take you for a ride. Meaning, they could take your product, lay sole claim to ownership, cut you out... I mean, for all you know, this person has already registered a patent on it. This person is older, wiser, and has a larger business acumen. You're a college kid, and this person very well could be banking on your naivete.

 

I'd be very wary of turning over anything to someone until you've sought legal counsel.

[TheVP]

lifter,

I'm afraid Ariel is right. Back when I was your age my brother and I had a similar arrangement. We both had full time corporate jobs, but we worked after hours on the business. He developed the product, and I worked on the sales and business side of things. When the product was about ready for prime-time, he quit his job and insisted the same from me.

 

I took the plunge and quit my full time job as well and worked full time on the business. Our business took off like crazy, but I can't imagine it ever happening if we didn't put everything we had into it.

 

We were both putting in 80 hour weeks, but even then there was a lot of arguments about who was contributing more to the business.

 

It's a lot easier to get along with someone when nothing's coming in. You'll have a lot of resentment if he stays with his safe job until your business takes off.

[a_lifters_life]

At this point though: I've done a bit of product development (say 5-10%) at what point SHOULD be the max I wait for him to end his career for this business?

 

If, he doesnt end at that point, can I just change the product name and run the same type of ecommerce site?

[Ariel85]

At this point though: I've done a bit of product development (say 5-10%) at what point SHOULD be the max I wait for him to end his career for this business?

 

If, he doesnt end at that point, can I just change the product name and run the same type of ecommerce site?

 

I think you're really missing the point here.

 

If you have zero legal claim to this product right now - meaning, you haven't registered or patented it, then your business partner very well may have already done so, which means you'll be doing all this work for nothing, as he already owns it. Once it launches, you'll then have no claim to profits, because in the eyes of the law, you never existed. Further, if NEITHER of you registers or patents the product, then ANYONE can steal it. Then you'll be fighting in courts for years to prove you developed this product, but if you don't have tens of thousands of dollars to do so, you will lose all rights to this product anyhow.

 

You NEVER EVER create a product that you plan to market and sell and turn it over to someone and "assume" they're going to split the profits. Nor do you not protect yourself to become the legal owner of the product.

 

And you can't change the name of a product and re-sell it if someone already owns it. It's called copyright and trade infringement, and if he owns it, he'll smack you right out of business forever.

 

If I were you, I'd consult a trademark and patent attorney before I took one additional step, who will explain how to protect yourself legally. Right now, you're ripe for the kill by a lot of people.

[a_lifters_life]

This isnt a product, or anything able to be patented. Its a mere service think 'ebay'.

[Ariel85]

This isnt a product, or anything able to be patented. Its a mere service think 'ebay'.

 

And have you checked into making sure that your service doesn't infringe on ebays existing patents?

 

From the ebay website:

 

Patent Notice

One or more patents may apply to this site and to the features and services accessible through the site, including, without limitation:

 

U.S. Patent Nos. 5,528,490; 5,608,786; 5,757,917; 5,761,649; 5,826,241; 5,835,896; 5,845,265; 5,870,473; 5,897,621; 5,970,471; 6,029,142; 6,047,264; 6,058,417; 6,067,350; 6,073,237; 6,085,176; 6,092,053; 6,125,185; 6,202,051; 6,205,433; 6,243,691; 6,246,996; 6,266,651; 6,295,522; 6,415,320; 6,422,460; 6,466,917; 6,523,037; 6,556,975; 6,604,107; 6,615,238; 6,732,161; 6,748,422; 6,778,993; 6,859,787; 6,910,019; 6,917,961; 6,934,720; 6,944,599; 6,985,934; 7,007,076; 7,072,944; 7,080,328; 7,089,208; 7,127,404; 7,130,818; 7,136,863; 7,139,726; 7,139,916; 7,146,341; 7,149,718; 7,162,446; 7,191,151; 7,222,092; 7,233,973; 7,249,094; 7,249,126; 7,299,206; 7,305,469; 7,310,733; 7,320,021; 7,334,019; 7,340,429; 7,343,335; 7,350,192; 7,366,856; 7,369,505; 7,370,006; 7,373,312; 7,373,317; 7,373,319; 7,395,257; 7,401,039; 7,406,464; 7,418,483; 7,418,657; 7,421,482; 7,428,505; 7,430,537; 7,457,778; 7,475,043; 7,480,638; 7,490,056; 7,493,281; 7,499,875; 7,499,979; 7,506,248; 7,509,323; 7,523,114; 7,526,670; 7,526,810; 7,527,195; 7,533,064; 7,536,336; 7,536,402; 7,558,834; 7,571,195; 7,581,112; 7,587,359; 7,587,367; 7,593,866; 7,596,510; 7,606,821; 7,610,216; 7,613,633 and all corresponding foreign counterparts.

 

You can't copy something that someone owns...

 

Again, seek an attorney ASAP. You're still treading in dangerous waters by not protecting yourself, and potentially stealing someone else's patented concept.

[a_lifters_life]

And have you checked into making sure that your service doesn't infringe on ebays existing patents?

 

From the ebay website:

 

Patent Notice

One or more patents may apply to this site and to the features and services accessible through the site, including, without limitation:

 

U.S. Patent Nos. 5,528,490; 5,608,786; 5,757,917; 5,761,649; 5,826,241; 5,835,896; 5,845,265; 5,870,473; 5,897,621; 5,970,471; 6,029,142; 6,047,264; 6,058,417; 6,067,350; 6,073,237; 6,085,176; 6,092,053; 6,125,185; 6,202,051; 6,205,433; 6,243,691; 6,246,996; 6,266,651; 6,295,522; 6,415,320; 6,422,460; 6,466,917; 6,523,037; 6,556,975; 6,604,107; 6,615,238; 6,732,161; 6,748,422; 6,778,993; 6,859,787; 6,910,019; 6,917,961; 6,934,720; 6,944,599; 6,985,934; 7,007,076; 7,072,944; 7,080,328; 7,089,208; 7,127,404; 7,130,818; 7,136,863; 7,139,726; 7,139,916; 7,146,341; 7,149,718; 7,162,446; 7,191,151; 7,222,092; 7,233,973; 7,249,094; 7,249,126; 7,299,206; 7,305,469; 7,310,733; 7,320,021; 7,334,019; 7,340,429; 7,343,335; 7,350,192; 7,366,856; 7,369,505; 7,370,006; 7,373,312; 7,373,317; 7,373,319; 7,395,257; 7,401,039; 7,406,464; 7,418,483; 7,418,657; 7,421,482; 7,428,505; 7,430,537; 7,457,778; 7,475,043; 7,480,638; 7,490,056; 7,493,281; 7,499,875; 7,499,979; 7,506,248; 7,509,323; 7,523,114; 7,526,670; 7,526,810; 7,527,195; 7,533,064; 7,536,336; 7,536,402; 7,558,834; 7,571,195; 7,581,112; 7,587,359; 7,587,367; 7,593,866; 7,596,510; 7,606,821; 7,610,216; 7,613,633 and all corresponding foreign counterparts.

 

You can't copy something that someone owns...

 

Again, seek an attorney ASAP. You're still treading in dangerous waters by not protecting yourself, and potentially stealing someone else's patented concept.

 

So how do I protect myself?

[Ariel85]

So how do I protect myself?

 

Consult with a good trademark and patent attorney. Because this is something you will want to deal with at a global level, you need not seek the services of someone locally. Because a filing would be made nationally and internationally, you can pick someone from a different state.

 

Tell them that you're in the development of a new e-commerce business, and you want to:

 

1 - make sure the concept doesn't infringe on anything existing

2 - register it so that YOU have exclusive legal rights to it

 

This kind of thing isn't cheap. I trademarked my business name, and it cost me a few grand for that piece alone. It's not something you can do on your own, like filing an LLC (which is cheap and easy), because there are so many different categories for filing, that an experienced attorney really needs to be counseled.

 

Now, if you don't have 20k lying around to do this, then if you make your service non-profit, you can find an attorney who needs a pro bono case. BUT, once you're registered as a non-profit, you can't become a for-profit under the same business model.

 

Most lawyers will give you a consult at a reduced or free rate. Worth the investment, IMO, if you need to throw $500 at it to get the proper advice.

[TheVP]

At this point though: I've done a bit of product development (say 5-10%) at what point SHOULD be the max I wait for him to end his career for this business?

 

If, he doesnt end at that point, can I just change the product name and run the same type of ecommerce site?

 

Every situation is different so it's really impossible to make any determination based on your postings. Someone might work for months and provide little of value, while a seasoned partner might be able to get you a $50,000 contract within a month's time. I'd recommend meeting with an business arbitrator or third party to communicate your expectations. One organization that'll might be useful in helping you (for free) in your early stages is "SCORE" (Service Corps of Retired Executives). link removed.