Your Idea is Worthless29 Dec 2016
As an electronics hobbiest and software developer, I’m often approached by acquaintances with various ideas for apps, websites, or electronics. What’s interesting is that often people take very serious ownership of their ideas, as if they have some kind of inherit value. In reality, ideas are worthless.
This post was not written in response to any specific experience I’ve had, but rather it’s just something I’ve been thinking about lately.
About a year ago, I received an email from an old coworker. He put me in touch with a few students who were looking for a “hardware guy” to help them develop a commodity electronics project they had an idea for. I eagerly accepted their invitation to meet up and discuss it further, as I’m always interested and eager to help people out with hardware stuff and just to get to know people.
Their idea was pretty simple really, it was basically a shirt that would light up in the dark. Light up, as in like a flashlight, or something. At face value, that idea kind of seems silly, like doesn’t that already exist? And if it doesn’t exist, it’s probably for a good reason (like nobody wants it). They had basically taken an off the shelf product and glued it together, then taken that to some kind of startup conference or competition where they had gotten a decent amount of interest. What they needed from me was to actually get a minimum viable product (MVP) created so they could launch a kickstarter campaign. After talking with them, concluding that I was capable of delivering their MVP, and signing an awkward non-compete agreement (which I literally can’t even), we agreed that I’d think about compensation and get back to them. They seemed like they were hoping I would take equity, or do it for free.
As I considered the options, knowing I have a finite amount of free time on top of work, school, and my family, I came to what I considered to be a pretty fair offer. I decided that taking equity in an idea doesn’t make sense. It has no tangible value, and a plan to simply launch a kickstarter and hope for the best wasn’t convincing enough for me to devote any time towards. I estimated that after all meetings, planning, and development, it would take me 20 hours of work to give them their MVP. Actually, I estimated it would take 40 hours, but I didn’t tell them that. Using all my own tools and resources, I asked for a rate of $50 an hour. I have no idea how competitive that is, but I don’t think it’s anything crazy considering I literally don’t personally know another person who has developed and sold a piece of hardware besides myself. I’m sure people are out there, but I don’t know them and they certainly didn’t. So in total, I asked for $1000. I wanted half up front, and half on delivery. In reality, I probably would only have charged them half that much if they proved to be pleasant people to work with, but I never got the opportunity.
I never heard back from them.
Not even to send me a copy of their slick non-compete I’d signed. I shouldn’t have signed it out of a matter of principle because a non-compete implies that your are competitive, and they weren’t. Because all they had was an idea.
And ideas are worthless.
When I was in 5th grade, I had an idea for a wonderful invention: what if you took a Palm pilot, and loaded a bunch of books on it? You could carry an entire library in the palm of your hand! Sure you’d need to spiff up the grayscale screen, but wouldn’t that be great? I’m sure I wasn’t the first person to have the idea, and I know I wasn’t the last. I’m sure Amazon wasn’t the first company to try an sell an e-book reader, but that doesn’t matter, because they are the only one that matters now. The value is not in the idea. It’s in the execution. Amazon executed the e-book reader better than anyone, and because of that, a kindle is now synonymous with e-book reader. Google is synonymous with a web search. Apple is synonymous with whatever it is that Apple actually does.
Actually, let’s look at Apple a little closer even. Specifically, the iPhone. They aren’t the only company making fancy expensive phones. I don’t even think their phone is better, from a hardware perspective, than a Samsung Galaxy X15 or whatever we’re at now. But the simple fact is that the iPhone is a better product! And it’s not because of a fancy logo on the back. They execute it better than anyone else. If you’re buying an iPhone, you’re buying consistent high quality hardware. It probably won’t explode in your pocket. But if it does, you can drive 45 minutes to your local Apple retailer and they’ll hand you a new one. Their execution is better than anyone else’s.
Even more perplexing to me is how invested people get in their ideas. People become so attached to their ideas that they develop an almost tunnel vision. They can’t see flaws in their ideas, and when people point them out it become offensive. I can’t begin to describe the psychological reasons for this kind of behavior, and I can’t claim to have never exhibited this behavior. But I would like to propose an alternative.
Rather than taking ownership of your idea, take ownership in yourself. You cannot possibly come up with the world’s greatest idea by yourself. The iPod was not conceived while Steve Jobs was in the shower. That’s just not how it works. Focus on what you can do to make it happen. And if the only thing you can do to make it happen is to casually launch an indiegogo campaign, you should give up. Start small. I mean microscopic. Produce your gizmo by yourself and sell it to one person, even at a loss. Download the slickest website template and get one person (who isn’t your mother) to sign up for an email when you launch. Don’t abuse your social media network. Don’t spam your friend’s inboxes. And for heaven’s sake don’t convince your mother to take out a second mortgage on her home to invest in your idea. The reason you should not do those things isn’t that they’re just lazy, scammy, and annoying. It’s because if that’s the best you can do, if after weighing all of the possible courses of action your best idea is to message the facebook friend you didn’t even talk to in high school and haven’t seen or heard from since, then you do not have what it takes to make it happen.
There’s a counterculture going around, kind of this grass roots anti-establishment pseudo-libretarian idea that somehow the “school of hard knocks” is a better education than you can get by going to business school. And to some degree, that’s true. But it’s true for a different reason. Steve Jobs would have been Steve Jobs whether he had gone to Harvard or Santa Monica Community College. He was Steve Jobs because of who he was and what he did. He was a successful person. You can be that too! Maybe not as successful as Steve Jobs, but you can be successful. And you can do it without losing friends and having a tumultuous life.
Another note to fully establish my bias: I hate patents. I hate “intellectual property”. Please don’t go give a lawyer $5,000 to go file your patent. Sure, maybe on Shark Tank they act like having a “patent” somehow increases value in your idea. I’m by no means an expert, but Apple is Apple because of what they do, not because they spent 5 years in legal battles with Samsung due to alleged copyright infringement. Just go build your thing. As you do, you’ll gain knowledge and experience that cannot be sold, that has incredible value yet not monetary worth. And I don’t mean that you’ll get a list of textile suppliers that you write down in a little black book and sleep with under your pillow. I mean you’ll learn how to pitch an idea. You’ll learn how to talk to a factory in China to do business with them. It’s things you don’t even know you don’t know, and the only way to learn is by just living and doing.
And lastly, please be nice to other people. Don’t go buy all the other top level domains of your competitors website. Offer to help. Give them advice, share your knowledge. A competitor should not be so threatening that if they learn where you buy your leather from they could put you out of business. If that is the case, you’re doing something wrong. And they will learn whether you help them or not. More than likely, there will be a day when they can help you in some way. Would you rather be able to ask their help, or would you rather be locked in a cold war because 6 years ago you wouldn’t tell them what temperature you run your reflow ovens at?
I can’t claim to be an expert on any of the topics discussed here. All this is my thoughts, which were formed based on my experiences dealing with people and running a trivially small shop myself. If you feel like I’m missing something, please comment! Help me to understand. If you have any questions, also feel free to comment! I’m happy to help.
But please don’t ask me to help launch your kickstarter.