Wednesday, August 15, 2007

Hoopleheads Comment

Kevin Prentiss commented:

Yes. And I couldn't agree more. I was excited about this until I got to the fine print.

I sent an e-mail to Erin Ennis, project manager right away.

A snippet:

Our challenge, and question, comes from the Intellectual Property Rights Policy. We don't have a problem with Creative Commons (we hope to go open source as soon as feasible) but the clause about 50 percent profit sharing seems to rule out both entrepreneurs and corporations, despite statements to the contrary.

. . .

From this, it seems that we would be giving up a perpetual 50 percent stake of our current business profits (from the last two years investment) to take a grant for future development. I do not see how we would untangle revenue from a grant funded product feature extension from the basic product. Giving up 50 percent of all future profits for 10-20% of the money we have already invested would not make sense for us or any other business in our potential situation (i.e. people with a good idea that is working or near working).

I ended proposing other structures without money.

Erin replied they were "checking with their legal department".

I don't think capitalism is the only way to innovate, but if they are going act like a VC they should be clear about that (and give similar terms.)

I don't think (smart) businesses would take this deal and I agree that any academic with a good idea that won may find themselves in a tight corner.

Doesn't seem like a recipe for fostering innovation to me.

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