When, why and how to launch your startup in secret

23rd November, 2017

When you’re building your startup, the first step is to tell everybody about it, right?

While there are thousands of startups out there trying to get the attention of the press and prospective customers, there are those that deliberately avoid the limelight.

Businesses like Domo and Rev have gone the unusual route of making people sign non-disclosure agreements before letting prospective customers and funders have a play around with their products.

It’s unusual for a company to launch in complete stealth mode, and with an interconnected ecosystem it’s kind of hard to do things in complete silence these days. So why would you want to keep your startup under wraps?

The main benefits

The benefits of launching in stealth mode can be broadly sorted into three categories:

  1. It gives you the focus to work on version 1.0 of your product without distraction
  2. It helps build an air of mystique around your company, especially if the founders are well known
  3. It keeps IP and the industry problem you’re targeting away from the prying eyes of potential competitors

It basically allows you the time and space to work on your product with a select group of potential clients and collaborators to keep the feedback loop really tight.

It also allows you to launch with a fully realised product which surprises and delights rather than doesn’t meet the expectations of hype.

Of course, this approach has its down side…

READ: What is a startup, seriously?

The drawbacks

Then again, trying to keep a lid on things could present these three problems:

  1. You can’t build early brand momentum if you don’t tell anybody about it
  2. It limits the number of investors, potential customers and other parties who can provide valuable feedback on early builds
  3. People may see your insistence that people sign non-disclosure agreements (NDAs) as a sign of unearned paranoia

In a world where there are thousands of startups vying for attention, keeping silent about yours can seem like cutting off your nose to spite your face.

But some startups swear by the benefits of launching in secret — so what’s the best way to do it?

The tools you’ll need

Some startups that choose to launch in secret do so because they’re afraid of someone stealing their idea — which isn’t always unfounded.

But IP lawyer (and Pulse contributor) Blake Knowles told The Pulse that the simplest way to avert this fear is to file a patent, which if granted, gives you exclusivity in the market you filed the patent in.

Of course, that could potentially tip off a rival if they’re savvy enough to be looking at patent applications in their area.

Meanwhile, a standard NDA could prohibit third parties talking about your idea to help protect it — but again, it’s quite limiting.

“From an IP protection perspective, any activity that exposes your product is generally incompatible with protection of the IP in the product itself, unless a patent application has been filed, or disclosures are carefully made subject to confidentiality agreements,” said Knowles.

“However, NDAs can limit the momentum of the product, and not all products or services are patentable. Spending money on patent filings needs to be strategic.

“Unfortunately, there are no other real ‘tools’ available to entrepreneurs to protect rights in the product itself, if they want to start generating interest in the market.”

READ: 5 IP shortcuts for small businesses

And that’s the rub — you can use NDAs to keep your new product or service under wraps, but it could be more difficult to build early momentum for your product.

Similarly, spending money on patent filings might limit your spend in other areas such as marketing.

Most startups don’t have the luxury of being able to build their product or service in the dark — they need to start making noise as soon as possible.

But for a few, launching in stealth mode may be the way to go.