So I’m taking a software engineering class this semester and it was suggested we find a real world client for a project. None of our group mates had any luck finding one, so I got permission from the teacher to run with an idea I had a year or year and a half ago (essentially be our own client). I convinced the guys in the group to run with it, and potentially run with it after the semester is over. I mentioned starting an LLC and using our website idea (which has not yet been done and has potential).
I am fairly certain there are no strings attached and the school has no claim on our project. Otherwise some of the largish local companies (The Missourian for instance) that are issuing tasks to one of the other groups, would not do so.
What sort of things do I need to do to protect our interests. The original idea is mine (and very little change has occurred so far), but I want to not only protect me, but the other group members from myself and each other. There are 4 of us, so I don’t think a partnership is best. I have several other ideas (some novel, some not so), and think that once we get this website idea up, we could easily branch off into making others, and perhaps even investing in other students projects (or non-students).
I don’t wish to talk too much about the idea publicly, but if you are interested or need to know what it is to help me further for some reason, just PM me.
I don’t think you need to worry about forming an LLC or corporation at this point. You use those types of business entities to protect you from liabilities. You won’t need to worry about that until you start having clients and making money.
At this point, you have an idea. The only way to protect that is to patent it, and even that is a weak form of protection. And it’s too late for that anyway. You’ve already told people about your idea.
I would say to just develop your website with your classmates as part of your project. If you still think it’s commercially viable, then you can consider what your next step will be.
If you end up using any of the tangible work (code, artwork, documents, etc) your classmates did, you must put together a contract that describes what sort of compensation your classmates will get. It may be as simple as paying them a certain sum of money for full rights to the code. Or it could be a percentage of the revenue the site generates. You will need to talk to a lawyer to make sure things are solid. If you don’t have a contract, I guarantee you that some of those classmates will sue you if you start making money with their work. Figure on spending at least $500-$1000 for the contract.
If your classmates don’t agree to give up their rights to the work, then you would need to completely re-develop the website on your own. If even one person did not agree, you wouldn’t really be able to use any of the code since you all worked on it. You could implement the same ideas/concepts on your own, but the coding would have to be done from scratch. That wouldn’t actually be a bad thing. Your project would be the prototype and you would likely do many things much better the second time.
And there’s always a chance that one of your classmates will take the idea and run with it. But if that happens, so what. Once your website comes on-line, anyone in the world can implement a similar idea. Customers will flock to the best implementation of an idea.
So my advice to you is to not worry about any legal stuff at this point. Develop the project with your classmates, learn a lot, and then re-implement the site on your own.
I’m not sure my idea is something I can patent, I don’t think you can patent web ideas. It’s not as if we have some revolutionary algorithm or anything tangible like that. I did tell people about it. Our class was required to give a presentation on a project proposal, so the whole class is aware of the project. The members in my group are all full time students like myself. I doubt they are going to run off and design a website complete with web apps before we get it done at the end of the semester.
I’m aware that first mover advantage isn’t absolute, look at how myspace transplanted Tribes, and facebook is dominating in turn, but I certainly would like to keep competition away as long as possible.