First Steps in Starting a Business

[U4iA]

Hello everyone,

I have an idea for a business that I think could fare very well given sufficient resources and proper execution. I am wrapping up my MBA right now. I have a couple of questions:

1) How can I get help from other people without giving the idea away? I have already spoken to a number of professionals who really liked the idea, now I'm kind of uneasy that I did because they have many more resources than I do to execute my idea. Moving forward, how can I solicit help without the threat of being ripped off? Should I talk to the people I shared the idea with and tell them to keep it under wraps?

2) Would I want to present the idea in an entrepreneurial course if I am actually thinking about pursuing it? We need to write a business plan in the course, should I just work on another idea with my group?

3) Who should I talk to first if I am serious about this? Attorney? Incubator? Entrepreneurial professor? Professionals in the field?

I have more questions, but I will limit my post to the most important ones.

Thanks for your help! I can really use some direction here.

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[Shredder]

VCs!

 

[Law2Doc]

Hello everyone,

I have an idea for a business that I think could fare very well given sufficient resources and proper execution. I am wrapping up my MBA right now. I have a couple of questions:

1) How can I get help from other people without giving the idea away? I have already spoken to a number of professionals who really liked the idea, now I'm kind of uneasy that I did because they have many more resources than I do to execute my idea. Moving forward, how can I solicit help without the threat of being ripped off? Should I talk to the people I shared the idea with and tell them to keep it under wraps?

2) Would I want to present the idea in an entrepreneurial course if I am actually thinking about pursuing it? We need to write a business plan in the course, should I just work on another idea with my group?

3) Who should I talk to first if I am serious about this? Attorney? Incubator? Entrepreneurial professor? Professionals in the field?

I have more questions, but I will limit my post to the most important ones.

Thanks for your help! I can really use some direction here.

If it's a really good, original and marketable idea, most people present a short confidentiality agreement to be signed before showing any third party their business plan or going through with a pitch meeting. Contrary to the prior poster, you NEVER ever want to show your idea to a VC, an incubator or "professionals in the field" without such an agreement (as these people are often in the best position to rip you off and run with the idea), and certainly you don't want to present it to a class if you plan to use it. A good business attorney can draw such a confidentiality agreement up for you, as well as help with your business plan, incorporate you, help you lock up any intellectual property rights involved and sometimes even introduce you to capital finance types. But before you incur legal expenses, I would do a lot of research on your own to make sure the idea is in fact original and viable. Good luck.

 

[mward04]

If it's a really good, original and marketable idea, most people present a short confidentiality agreement to be signed before showing any third party their business plan or going through with a pitch meeting. Contrary to the prior poster, you NEVER ever want to show your idea to a VC, an incubator or "professionals in the field" without such an agreement (as these people are often in the best position to rip you off and run with the idea), and certainly you don't want to present it to a class if you plan to use it. A good business attorney can draw such a confidentiality agreement up for you, as well as help with your business plan, incorporate you, help you lock up any intellectual property rights involved and sometimes even introduce you to capital finance types. But before you incur legal expenses, I would do a lot of research on your own to make sure the idea is in fact original and viable. Good luck.

I agree. Good advice...you should be charging for this instead of going to med school

 

[Law2Doc]

I agree. Good advice...you should be charging for this instead of going to med school

I used to.

 

[U4iA]

thanks so much for the post. it was very helpful.

I have been going crazy over the past few weeks.. literally, I have been stressing more than I ever do.. mainly because I think that this is a killer idea. but I am conflicted because I realize that pursuing this idea could take years and would involve putting off medical school. I wouldn't mind doing that, but since I don't know how to get the right people involved (who have the necessary business and legal skills without giving the idea away) I have been somewhat paralyzed .... and even if I could find the right people to make this idea take off, I am terrified that some big company with similar experience and better contacts can jump in and take us out. these are the realities of business.

but the fact that I have the thought process above is leading me to believe that I am not an entrepreneur. I may have semi decent ideas but I don't have the guts to put what I have on the line and take a risk.

again, thanks for the post.

 

[GTA]

thanks so much for the post. it was very helpful.

I have been going crazy over the past few weeks.. literally, I have been stressing more than I ever do.. mainly because I think that this is a killer idea. but I am conflicted because I realize that pursuing this idea could take years and would involve putting off medical school. I wouldn't mind doing that, but since I don't know how to get the right people involved (who have the necessary business and legal skills without giving the idea away) I have been somewhat paralyzed .... and even if I could find the right people to make this idea take off, I am terrified that some big company with similar experience and better contacts can jump in and take us out. these are the realities of business.

but the fact that I have the thought process above is leading me to believe that I am not an entrepreneur. I may have semi decent ideas but I don't have the guts to put what I have on the line and take a risk.

again, thanks for the post.

In any startup situation keep Bayes rule in mind >> even if you feel you have a 'perfect' idea (ie, 100% probability of success), applying Bayes Rule with the statistical probability that only 33% of startups actually work, you have AT BEST a 33% probability of your killer idea working... sobering...

Also, be aware are ALL TIMES that you are HIGHLY biased about your idea...this is the single biggest mistake startups make. And you friends are biased as well, so take what they say with a grain of salt.

A confidenciality agreement would be good (i have one i will send you if you email me), however, someone stealing your idea is the least of your worries...that really only happens in the movies (for the most part). Right now, you need to get people to pick apart your idea, from all angles.

good luck..

 

[Law2Doc]

however, someone stealing your idea is the least of your worries...that really only happens in the movies (for the most part).

It actually does happen in real life a lot more than you think -- I've seen it occur several times. However I agree with the rest of your post.

 

[CanuckRazorback]

I might be assuming wrong, but if you are looking for early stage funding and don't need a huge chunk, consider SBA loans. And I definitely agree with everything that has been said about confidentiality agreements. I have had to sign several of them before reviewing people's ideas for businesses. It's a common practice.

 

[mward04]

I spoke with an experienced entrepreneur the other day about non-disclosure agreements and he said they really don't mean anything. Just because you sign a NDA doesn't mean you can't go out and do the idea anyway. Maybe the MD/JD can comment of these, but that's my understanding.

Addiitionally, he said, you have to be careful who you speak with. Second, someone else has probably thought of what you are doing anyway, so don't worry so much about it and if they haven't and it's that unique, you'll probably be able to patent or protect it somehow. He also said, which makes sense, is that your idea doesn't have to be revolutionary, it can simply be doing the same thing as someone else, just adding a twist or doing it that much better.

Anyway, hope this helps.

 

[Law2Doc]

I spoke with an experienced entrepreneur the other day about non-disclosure agreements and he said they really don't mean anything. Just because you sign a NDA doesn't mean you can't go out and do the idea anyway. Maybe the MD/JD can comment of these, but that's my understanding.

Frankly, the entrepreneur you spoke with is either out of his mind or likes to spend his days in court or his money on lawyers. In my experience, it is fairly common to hear laymen say that a contract is "not worth the paper it's printed on", but they tend to get a dose of reality when they break it... If you sign a confidentiality/NDA agreement and then run out and use the idea, you will be sued and unless you can clearly show to the satisfaction of a judge/jury that you came to the idea on your own at an earlier date, or that the idea really belongs to someone else (who then will have the right to sue the both of you), you will likely lose.

 

[Law2Doc]

He also said, which makes sense, is that your idea doesn't have to be revolutionary, it can simply be doing the same thing as someone else, just adding a twist or doing it that much better.

I sort of agree with this part of the post. Most innovation involves "building a better mousetrap" not building the first mousetrap. However if someone has intellectual property (patent/copyright/trademark) rights to the original idea or its primary components, you may be walking a precarious line as to what you can do on your own and what you need to license from the originator before you can expand on it. For example, Bill Gates needed to license most of the GUI, icon and mouse technology from Xerox before Microsoft could legally create and patent Windows.

 

[GTA]

I sort of agree with this part of the post. Most innovation involves "building a better mousetrap" not building the first mousetrap. However if someone has intellectual property (patent/copyright/trademark) rights to the original idea or its primary components, you may be walking a precarious line as to what you can do on your own and what you need to license from the originator before you can expand on it. For example, Bill Gates needed to license most of the GUI, icon and mouse technology from Xerox before Microsoft could legally create and patent Windows.

Statistically, an new business has 4 to 5 times better chance of being sucessful if it is based on a RADICALLY new idea, not just putting a new twist on an old one. Just a thought.

 

[U4iA]

thanks for the responses.. they definitely have kept me thinking..

let me flip this over to more of a personal question.. assume you are in your mid-twenties, accepted to medical school, really enjoy what you know of medicine (although you fully realize you have very little idea of what you're getting in to), you enjoy science and learning... but you also have a strong entrepreneurial spirit..

what would it take for you to pursue the entrepreneurial venture now? do you think there is any way to balance your aspirations for business creation and medicine in the short term?

i have more questions, but i don't want to stifle the dialog.. thanks for your thoughts/suggestions..

 

[Law2Doc]

Statistically, an new business has 4 to 5 times better chance of being sucessful if it is based on a RADICALLY new idea, not just putting a new twist on an old one. Just a thought.

That's probably true --although I don't even know where you would go to find such a statistic ... sounds very off the cuff to me.
But very few people are able to generate "radically" new and viable ideas, most business or product ideas are improvements or build on prior technology/science/ideas, and frankly most ideas and businesses (radical or not) fail when brought to the business/market setting. Thus having a radically new idea is great, but such goal may prove very elusive and might be somewhat like buying four lottery tickets instead of one -- you increase your odds of success but maybe not appreciably.

 

[Law2Doc]

thanks for the responses.. they definitely have kept me thinking..

let me flip this over to more of a personal question.. assume you are in your mid-twenties, accepted to medical school, really enjoy what you know of medicine (although you fully realize you have very little idea of what you're getting in to), you enjoy science and learning... but you also have a strong entrepreneurial spirit..

what would it take for you to pursue the entrepreneurial venture now? do you think there is any way to balance your aspirations for business creation and medicine in the short term?

i have more questions, but i don't want to stifle the dialog.. thanks for your thoughts/suggestions..

If you want my two cent opinion, I would do med school now, for the following reasons. I would have to think that getting the MD first would give you some degree of credibility in any subsequent entrepreneurial ventures -- especially if such ventures involve medicine/health related products, services or technology. Also, it's also probably going to be easier to tackle med school now in your mid twenties and then later do the entrepreneur thing than to do it in reverse -- but certainly not impossible. Hope that helps. Good luck.

 

[fun8stuff]

It actually does happen in real life a lot more than you think -- I've seen it occur several times. However I agree with the rest of your post.

Does the name Bill Gates come to mind? heh

 

[mward04]

If you want my two cent opinion, I would do med school now, for the following reasons. I would have to think that getting the MD first would give you some degree of credibility in any subsequent entrepreneurial ventures -- especially if such ventures involve medicine/health related products, services or technology. Also, it's also probably going to be easier to tackle med school now in your mid twenties and then later do the entrepreneur thing than to do it in reverse -- but certainly not impossible. Hope that helps. Good luck.

Spoken like a true risk taker

You could also turn this around and say that it's a heck of a lot easier to put your butt on the line financially when you are not supporting anyone (family). While yes, an MD could give you credibility, it could also hurt you. Business people hate dealing with physicians and there is an enormous stigma against physicians. Also, if your idea is actually good, has not been done well before, by the time you emerge from med school and residency, your idea may have been done by someone else.

Here's what I suggest, write up a reasonable business plan and really think through it and whether it is viable-what is your market like, what would it take to be profitable, where are you going to get $$ from etc. Show it to a couple of family friends that know businesses well and that you trust and get their input. Get them to give you good, honest, candid feedback. If, after all of this, you still think your business will work, I say do it. Meanwhile, do the med school applications

 

[Law2Doc]

Spoken like a true risk taker

I assure you that most of us career changers are far bigger risk takers than you will ever come across.
I think your suggestion of having an MD being perceived negatively by "business people" is a gross generalization, and simply not accurate in medical technology or health related fields (at least not that I've come across).
However I more or less agree with the business plan course of action suggested in your post.

 

[mward04]

I assure you that most of us career changers are far bigger risk takers than you will ever come across.
I think your suggestion of having an MD being perceived negatively by "business people" is a gross generalization, and simply not accurate in medical technology or health related fields (at least not that I've come across).
However I more or less agree with the business plan course of action suggested in your post.

I'm sorry, but I have to disagree. When physicians are being asked to work in a business environment, more times than not, they are perceived as a true pain in the axx. I'll give you a recent example. The guy who created MedBuddy, http://www.medbuddy.com/ initially decided to sell this to physicians as an extra source of revenue for them because the MDs can bill for the services through this. Even though they would only pay $100 as a subscription fee the MDs couldn't get over it. One of them said, "that's more than my cellphone!" even though they would return many times over this in revenue per month. This guy ended up giving up on physicians and started selling directly to Universities and now he has something like 150K students connected on this.

Trust me, if you think that physicians are positively perceived, you need to get some honest feedback, because they are not. Haven't you ever heard the expression that managing physicians is like herding cats???

 

[Law2Doc]

I'm sorry, but I have to disagree. When physicians are being asked to work in a business environment, more times than not, they are perceived as a true pain in the axx. I'll give you a recent example. The guy who created MedBuddy, http://www.medbuddy.com/ initially decided to sell this to physicians as an extra source of revenue for them because the MDs can bill for the services through this. Even though they would only pay $100 as a subscription fee the MDs couldn't get over it. One of them said, "that's more than my cellphone!" even though they would return many times over this in revenue per month. This guy ended up giving up on physicians and started selling directly to Universities and now he has something like 150K students connected on this.

Trust me, if you think that physicians are positively perceived, you need to get some honest feedback, because they are not. Haven't you ever heard the expression that managing physicians is like herding cats???

I think perhaps there is a difference between physicians as customers versus physician as entrepreneur. As an attorney I have to say there was nothing more helpful when pitching an idea for financing or to distributors where you had a physician on your side of the table.
(And FYI the "herding cats" expression was actually not coined for physicians.)

 

[mward04]

I think perhaps there is a difference between physicians as customers versus physician as entrepreneur. As an attorney I have to say there was nothing more helpful when pitching an idea for financing or to distributors where you had a physician on your side of the table.
(And FYI the "herding cats" expression was actually not coined for physicians.)

I never said that that was how the expression was coined-I was saying that dealing with physicians is frequently likened to herding cats.

Is it helpful to have a physician on your side if you are pitching a product that is healthcare etc.? Yes, of course it is. They offer a specific expertise. But that's not what I said. Physicians are a pain to deal with when it comes to business. They argue insignificant points, never show up to meetings on time and are practically impossible to manage. Each physician believes they are autonomous and has their own set of rules. Does this mean this applies to every single physician? No, of course not. But the general perception is that this is how physicians are perceived in the business community.

 

[Law2Doc]

I never said that that was how the expression was coined-I was saying that dealing with physicians is frequently likened to herding cats.

Is it helpful to have a physician on your side if you are pitching a product that is healthcare etc.? Yes, of course it is. They offer a specific expertise. But that's not what I said. Physicians are a pain to deal with when it comes to business. They argue insignificant points, never show up to meetings on time and are practically impossible to manage. Each physician believes they are autonomous and has their own set of rules. Does this mean this applies to every single physician? No, of course not. But the general perception is that this is how physicians are perceived in the business community.

Fair enough, although I think perhaps our definitions of "business community" and where physicians would fit in in a business are not exactly in synch. And I don't know what poll you took to obtain such "general perception" -- my experience working with business people in a variety of business contexts for a relatively long period of time has been that the perception is pretty much the opposite. (It's the lawyers that are viewed as the trouble makers ).

 

[NotShorty]

do you think there is any way to balance your aspirations for business creation and medicine in the short term?

Are you able to build your business to an attractive, somewhat stable level, then quickly sell it and move on to medicine? That way, you may be able to satisfy your need for both. A "have your cake and eat it too" scenario.

Sorry. This thread's interesting to me, but I don't have any expert advice to contribute.

NS

 

[U4iA]

Are you able to build your business to an attractive, somewhat stable level, then quickly sell it and move on to medicine? That way, you may be able to satisfy your need for both. A "have your cake and eat it too" scenario.

this is the type of business that would require a good amount of time to develop and sell.. with the "have your cake and eat it too" mentality I feel like it would be setting up for failure.. anyways, if this were successful in the short term, i don't think i would want to leave because there are many options for growth..

 

[backontop]

hey man (u4ia),


i do not think that your aspirations for medicine are currently compatable with you business aspirations. People on the pre-med forums have no idea what medical school entails. It is soooo draining and requires a great deal of focus. I can not fully describe the experience other than I don't care how smart you are, you will likely fall behind. Many valedictorians and IV league people have tried and many have died. I was a bio major, and figured that the next step was medical school, although i wasn't sure. i only applied to 1 school, assumed i wouldn't get in and would work for a little, then reapply. i got in, was so excited, assuming that the transition would be comparable to the transition from high school to college. Ha!

i truly thought that I was so smart that i would likely be one of the top three people in the class! Man, was i clueless! I have never seen more academic talent. I didn't know people could be that smart! also, you have to remember that the people with photographic memories still have to pull ridiculous hours of study (often they don't know they have it, cause it's always been that way... a big clue is they never use mnemonics.) the only difference was that they ended up getting the 85% and i got the 75%. its very interesting what it does to your ego when you get F's on tests but have never seen a B- in your life.

anyway, i didn't completely have my heart in it (1 app., come on?!), and was ready to quit during 2nd and 3rd yr. they told me that that was silly cause besides the debt i was incurring, if i quit now, i have nothing to show. They convinced me that no matter what field i went into, the best part of my resume would be the MD after my name.

which brings me to forums like this. I have major problems with the medical residency system in america, but i will not discuss them here, cause my arguments have convinced people in my class to leave medicine (only 2 or 3, but i realized that this is not a good thing for our society.)

Remember, if you choose medicine as you career it will engulf you (one of the reasons doctors are notoriously poor with investments/money; they have the capacity to be great at anything that requires knowledge; just no time.)

ummmm... guess i got a little off topic from your post, but I think it's great you got into medical school. I can't think of a field that an MD won't help you in. People will kill me for this, but i really feel that if you got accepted in an american medical school (non-DO) you will be at an advantage if you decide to ditch medicine (i graduated in nov. 04' and many of the jobs i'm applying for require 9 yrs experience if you are out of college, 7 yrs w/a master's, 4 yrs w/ a phd, and 0 with an MD.)

gosh, you got a lot of thinking to do. An MD-MBA sounds great; is there any possibility you could do that??

And, I strongly feel that if you did happen to luck out and get into an american MD school you should do it no matter what your aspirations are (people have committed suicide over trying to get in).

please respond to me by PM if you have any further questions.

thanks for the responses.. they definitely have kept me thinking..

let me flip this over to more of a personal question.. assume you are in your mid-twenties, accepted to medical school, really enjoy what you know of medicine (although you fully realize you have very little idea of what you're getting in to), you enjoy science and learning... but you also have a strong entrepreneurial spirit..

what would it take for you to pursue the entrepreneurial venture now? do you think there is any way to balance your aspirations for business creation and medicine in the short term?

i have more questions, but i don't want to stifle the dialog.. thanks for your thoughts/suggestions..

 

[Law2Doc]

i do not think that your aspirations for medicine are currently compatable with you business aspirations. ...
An MD-MBA sounds great; is there any possibility you could do that??

Wow, your post is all over the place and not totally internally consistent. I think the OP was trying to decide if he should do a business venture now, or defer it till after med school (if at all).
Plus he seems to almost be done with an MBA already...

 

[backontop]

hmmm.... i guess so.

i usually like to argue with people on these forums, but you're right. just reread it along with the rest of the thread. i was playing multi-table hold'em and writing in between hands. sorry it came out like i was on lsd.

just trying to help out the OP; i would rewrite the post with additions, omissions, and a little more fluidity; but i think ill leave the business advice to you and more knowledgable posters. interesting thread though...
i have a couple questions for you, but i gotta log off. i'll try to pm you later.

-remember: in a full ring low-limit game ALWAYS fold A9 off-suit unless you are in the late position AND first in, in which case you would raise rather than call.

Wow, your post is all over the place and not totally internally consistent. I think the OP was trying to decide if he should do a business venture now, or defer it till after med school (if at all).
Plus he seems to almost be done with an MBA already...

 

[Shredder]

Remember, if you choose medicine as your career it will engulf you

It was my understanding that, like an MD/PhD, an MD/MBA is not likely or expected to fulfill the roles of the dual degree in a mutually exclusive fashion with either half engulfing him. As with any combination of degrees, it is more valuable to society for the holder to use them synergistically in ways that holders of individual degrees cannot.

I contend that medical school doesn't require brilliance, just mastery of memorization and transformation into a living textbook/algorithm. Not to condescend--it is interesting and has value, thus doctors' compensation. But learned knowledge has its limits, and accordingly so too does a traditional physician's upward mobility and clout.

 

[mddre]

It's an interesting comment you made about doctors being notoriously poor with money and investments. A few years ago, I had a pre-medical mentor and the very first time I met with him, two things clearly stand out about my meeting with him. First, he said that doctors are horrible businessmen, so you don't become one and second, make sure that you learn spanish. I can understand the spanish part, but I'm still confused about the business part and I noticed you had to say this in your post:

"Remember, if you choose medicine as you career it will engulf you (one of the reasons doctors are notoriously poor with investments/money; they have the capacity to be great at anything that requires knowledge; just no time"

I have a strong love for business, but I definitely want to become a doctor before a businessman. I managed a business eversince I was 20 years old and I greatly enjoy following my investments and managing my money. So when you say that doctors are bad in such things, is it because of the fact that they lack the knowledge and the training, or it is due to the fact that they are so buy with their practice that they don't have time to follow their financial affairs? I'm looking forward to hearing some interesting comments about this!!!!

P.S. Let's see what Senior Greenspan will do on Tuesday? Is it time to lighten up on the housing stocks and the home builders?

 

[Law2Doc]

It's an interesting comment you made about doctors being notoriously poor with money and investments. A few years ago, I had a pre-medical mentor and the very first time I met with him, two things clearly stand out about my meeting with him. First, he said that doctors are horrible businessmen, so you don't become one and second, make sure that you learn spanish. I can understand the spanish part, but I'm still confused about the business part and I noticed you had to say this in your post:

"Remember, if you choose medicine as you career it will engulf you (one of the reasons doctors are notoriously poor with investments/money; they have the capacity to be great at anything that requires knowledge; just no time"

I have a strong love for business, but I definitely want to become a doctor before a businessman. I managed a business eversince I was 20 years old and I greatly enjoy following my investments and managing my money. So when you say that doctors are bad in such things, is it because of the fact that they lack the knowledge and the training, or it is due to the fact that they are so buy with their practice that they don't have time to follow their financial affairs? I'm looking forward to hearing some interesting comments about this!!!!

P.S. Let's see what Senior Greenspan will do on Tuesday? Is it time to lighten up on the housing stocks and the home builders?

I suspect it's a lack of training, combined with a bit too much of the wrong kind of self confidence. People who become doctors sometimes think they know more than they do, and thus from what I have seen, are more likely to try to do business management, investment, accounting, tax planning and other business functions on their own without bothering to learn the basics. If you majored in a science and then went right into medicine without having ever worked, your exposure to very basic business courses or skills are basically nil. Yet somehow (anecdotally, based on my prior professional experience) these are the people who seem most likely to set up their own practices. Those that are successful tend to either be very quick self learners or are smart enough to hire ancillary professionals (accountants, lawyers, management consultants) as needed.

 

[reddirtgirl]

VCs!

or pre-VC's : angel money investors (there's some overlap)

GOOD LUCK!

 

[Shredder]

I'm familiar with angel investors; I'm already one if you note my little icon. Heheh, bleh I need to go study