15 November 2011

Benchmark Steals Ideas of an Indian Entrepreneur

The prospect of raising business capital can be daunting. Your effort to raise business capital makes venture capitalists the most generous people. But little did we know that even Venture capitalists can steal potential ideas from entrepreneurs that can be a big money churner for them. At least that is what Fatdoor Founder Raj Abhyanker claims.

 Entrepreneurs are very possessive about their ideas and protect them like they are a Sorcerer?s Stone. Fatdoor founder Raj Abhyanker on Thursday filed a complaint against Benchmark Capital for interference; fraud and misappropriation of trade secrets after seeing the Benchmark-funded Nextdoor launch its local social network last month. Whereas Abhyanker had claimed that he had initially proposed the ideas to Benchmark.

Raj Abhyanker
The legal claim has put many big names under scanner including LinkedIn founder Reid Hoffman, Zynga CEO Mark Pincus and Facebook CTO Bret Taylor who have been slapped with a legal notice.

In 2007, Abyanker shook hands with Benchmark by pitching in a neighborhood site. He decided to call it Nextdoor if he could buy the domain name. Benchmark was initially interested in the proposal but then the VC Company backed out later.

Abyanker alleges that the firm and other that the firm and other defendants "fraudulently misappropriated and stole trade secrets, business plans, unpublished confidential patent applications, knowhow, and software technologies regarding the Nextdoor/Fatdoor concept."

Abhyanker, who later created The Dealmap, a daily deal aggregation site which sold to Google, noted in the complaint that he had every intention to purchase the domain name Nextdoor.com if the venture financing with Benchmark was secured. But Nextdoor founder Tolia tells All Things D that "the idea and naming of Nextdoor was originated solely by the employees and founders of our company."

The suit notes that partners at Benchmark had received a confidential executive summary, and Abhyanker had "spent several hours at Benchmark disclosing the entire concept in detrimental reliance on Benchmark's written assurances of confidentiality and no conflicts."