confused entrepreneur

I met David Kerzner on the Startup Train somewhere around Belleville, Ont. Most of the others were already in the bar car getting mentored, pitching ideas, or hoping to see David Crow take his pants off. Kerzner was working. He recently set up investment firm Star Power Capital and was riding the train, in part, looking for potential investments.

Kerzner, who co-founded video-blogging site keek.com, says even the startups with the best ideas often get tripped up when investors ask them one question: how do you plan on protecting your precious idea from the big guys?

“They’ll get asked, ‘If it’s such a great idea, why can’t Facebook do it?’” said Kerzner.

This problem—coming up with a great product or idea, only to be mimicked by bigger players and crushed—isn’t unique to the tech world. Any time you have a product, technology or idea that’s not proprietary, you risk losing your piece of the market to copycats (see: Groupon).

So, how do you answer this question when investors throw it at you?

You can start by pointing out that tech giants’ interest in riffing on someone else’s idea is rare.

“Typically, a major entity like Facebook or Twitter doesn’t like to take ideas and build on them,” said Kerzer. “It’s very rare to find a major company building out an organic idea, because nobody at the company wants to take that kind of a risk. Only an entrepreneur would put his life on the line to grow a company; an employee will never do it.”

That’s not to say a Facebook or a Twitter won’t acquire you once your idea grows into a successful business (just ask Instagram). That is, if they can afford you, said Kerzner. But outright copying is pretty unlikely.

Other tips that might help you answer the question?

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