Legal preparation/NDA when shopping a new technology around

Question

Several years ago I created some custom algorithms and code for processing CNC files (basically ways of controlling automated machines for manufacturing). Now, years later, I found suddenly that my small side project has come to the attention of one of the larger CNC companies and they contacted me and are very interested in it. I am now planning to visit three different companies to show them my project and see if they're interested in buying/licensing it.

So I will visit the companies, show off my software, explain the algorithms, demonstrate the way they can gain some market from it, and then go into salesman mode and see if they're willing to throw money at me to take the ideas, license them, hire me as a consultant, whatever seems to be best for me.

Finally, my question: How do I protect myself from the obvious problem of giving a great demo, convincing the company that I have some new tech they'd be perfect for, but find that a month later they're just going to simply steal the ideas I explained and develop their own version themselves?

The obvious answer is some kind of NDA for me to get the company to sign. The second obvious answer is to get an IP lawyer to gird me in legal armor and preparation. I plan to do both of these steps.

But what else should I do before discussing new technology with a company which would really really like to have it, and could steal it if given enough detail? I will get the legal advice, but now I need programmer experience, especially if you've every sold software/algorithms/products to another company.

Followup details: The main asset is a set of algorithms.. I could teach the technical guys the basic framework in one day and from that any competent programmer could fill in the details. This is why I'm worried that the sales pitch may end up being too revealing! Also, my problem is not in my ownership or legal rights to my work, this was a solo project I did when I was learning about one machine. I shared my bunch of utilities with another business, and the CNC company rep was visiting and went wild when he saw his machines performing certain procedures so much faster than the company's methods.

My normal job is a networking consultant, so this opportunity is almost a surprise to me!

Answer 1

I could teach the technical guys the basic framework in one day and from that any competent programmer could fill in the details. This is why I'm worried that the sales pitch may end up being too revealing!

A sales pitch should describe the potential results of adopting your idea, not the implementation details. Watch any infomercial on late-night TV and note how little time is spent explaining how the product works. OxiClean doesn't start flashing redox chemical reactions and enthalpy formulas on the screen next to Billy Mays's face, do they?

Similarly, you want to explain to your potential investors why they should go with your technology and the results of doing so. That is how you'll convince them. If they want more concrete proof that the technical details are sound, you can do a demo.

I'll leave you with these words:

"Don't worry about people stealing your idea. If it is original, you will have to ram it down their throats."

-- Howard Aiken

Answer 2

(warning: I Am Not A Lawyer)

If you're planning to patent any of your ideas (a bit more difficult now due to last year's Bilski case), you should know that there's a timeclock (the "grace period") that starts when you "disclose" your invention to others, which may include discussing it w/ other parties, I'm not sure. In the US it's 12 months, some countries 6 months -- you have to file a patent before this runs out, otherwise it is declared invalid (your disclosure to the public becomes "prior art" for a patent application filed after that point).

Also note that in the US there's now a Provisional Patent application which essentially gets your foot in the door for filing, for a smaller fee, and you have 12 months to file a "real" patent.

Answer 3

Two other things that I would add. First, every time you even brush by the topic of the specifics make sure that you make reference to "core algorithms" or something quite important that you are omitting. Second, when (not if) they probe for details, do not for a moment be ashamed of setting up a bit of a barrier. Assuming that they already know that you are the real deal, you don't have to explain the algorithms in detail to "prove" your idea so avoid the temptation.

Josh is on the right track as well: know your value but don't get so greedy that they have a huge incentive to work around you.