Ask HN: Begin startup based on own side project open-sourced through my employer

3 pointsfibonacci1123581y ago3 comments

I work at a FAANG-size company (moonlighting friendly in theory) and have a side project that I've built mostly in my free time, a bit during work hours, and had it recently approved by the legal department for open-sourcing and it's now available in public on GitHub with an MIT license for everything.

Since the MIT license allows anyone to do whatever they want with the project, including commercial use and creating derivatives, I'm tempted now to create a startup based on the project - basically fork it and work in private on it, extending and improving it a lot (make it worth buying it compared to OSS version), then rebrand and launch it as a subscription app.

This future work would not touch any company-owned hardware and resources, unlike the work that got open-sourced (that was the reason it's now on the company's GitHub account and not mine, was happy enough open-sourcing went smoothly through approvals).

The moonlighting policy is fairly permissive, but also somewhat vague especially about what a competing product is (whole product or a small module in a larger product is enough). The other restrictions are the usual, don't use company hardware, time, connections to do the work.

There are several concerns I have and I'm also curious if others have dealt with a similar situation and have some advice:

- my fear is that even if I'm following the moonlighting policies from now on, they could later still claim ownership of my work based on the pre-OSS work. If someone else outside the company would fork the OSS repo there should be no problems given the MIT license, it's what these companies are doing all the time by wrapping Postgres and the like... - the company doesn't have a stand-alone product it sells similar to my app, but there is one small module similar to it part of a huge app. I assume that is enough to argue that my app is a competitor if one wants to.

Given this, feels like safest would be to quit my job before even starting to work on this, but of course I'd like to avoid that, with the startup maybe not working out. Switching to another company is another option, but seems others have even worse or no moonlighting. Last option, work on it while employed and hope I won't get sued. Maybe quit around the time I'm close to be done with a v1 and start marketing to reduce risk a bit.

As for the company itself, I'm not seeking funding and don't see it getting to some multi-million/y business, at best enough to make a full-time job out of it. Maybe that's enough to not make it worth suing.

3 comments

mindcrime1y ago

One thing you could consider trying, depending on your relationship(s) with the higher management at your existing employer: ask them for explicit permission to commercialize the open source project. Heck, you might even go as far as to ask them to invest in your project.

You'd need to spend some time working out your case for why this is a "win win" for everybody involved; and all of this would depend a lot on how reasonable those people are (and how much you trust them) but in the ideal scenario this could possibly be the best situation of all.

Short of that, I'd say "work on it *in private* on your own time, do *not* talk about it at all with any of your current co-workers, and then quit your existing job before actively starting to sell the product in the market".

Best case, you quit, your existing employer forgets all about you and the project, and you never cross paths with them again. This would probably be easier if your new product isn't a directly competing project to whatever they do, and if you don't target their existing customer base.

On that last point, I can't emphasize that enough: if you were to go out and target their existing customers (especially if, FSM forbid, you make the mistake of contacting people you are in contact with as part of your current job, or take any emails/phone numbers/etc. from your current job) that would probably draw their ire, and bring down legal wrath, faster than anything to do with the product itself. If you do this, try to focus on selling to a different set of customers if at all possible.

t_hinman_esq1y ago

Hi! I am a startup attorney -- of course I can't give you specific legal advice here, but Mindcrime makes some excellent points!

Many states have explicit laws that protect employees from having to assign IP that they have developed on their own time, with their own resources. If you live in CA, CA is a very employee-friendly state and any restriction on competition is generally against public policy.

Without having seen any of your agreements, I would say that if you work on a project on your own time, with your own resources, it is unlikely that will run afoul of your employment restrictions. In addition, staying away from your employer's bread-and-butter revenue streams is also just generally good advice if you're trying not to draw attention or make people angry. ;)

Happy to chat more if that's helpful!

fibonacci112358OP1y ago

Thanks for the reply! I'm in WA, the moonlighting IP law seems very similar to CA. Both my contract and current HR guidance state that any invention is mine if done outside work hours, not using their hardware AND doesn't compete with the company and harms it's business interests - the vague part, especially with a company that has it's fingers in dozens of different software.

The app itself is similar to a module of a much larger product the company sells, but that product is far from being a money-maker for the company (may just break even). People are certainly not buying the whole product because of that module, it's a nice thing to have. There are several other companies that do sell stand-alone apps similar to mine though, there is a market for it.

The other concern was whether starting now the work based on the MIT open-sourced version of my app creates a clean slate for me, since the previous work was done in part during work hours on their PCs. Open-sourcing the app through my employer was the only way not to lose it completely in case I switch companies, and have a chance to try a startup based on it.

Some advice I've got was that forking the OSS version should be done by a friend (not in the company) and I should work on it in the background and officially join later, after I quit - that also feels sketchy.

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