“When an investor you pitched everything to, tells you they are now doing something competitive….It’s just a terrible feeling!”

“I Feel Kind Of Stupid Now,” Rugolo Added. “Because We Talked For So Long. I Met With Them so Many Times and Demo’d all Their People —Talking About All Our Ideas.”

Not the first time and not the last!

But how do you protect your business in this scenario?

Jason Rugolo, founder and CEO of iyO, is complaining that he was duped into revealing all the know-how (good research and failed test results) around ‘in-ear’ devices that Sam Altman and Jony Ive were considering for their AI hardware venture.

‘This particular email from Sam Altman was probably the worst email I’ve ever received in my professional life. When an investor you pitched everything to, tells you they are now doing something competitive….It’s just a terrible feeling. I was a fool here being optimistic I could turn this into a collaboration. I really thought we could team up, and at the time really respected him”.

Seduced by the massive potential of a partnership Rugolo forgot himself and shared way too much.

Now wallowing in regret, he’s scrabbling to recoup the value lost.

He’s sued for trademark infringement and sued former employees for leaking confidential drawings.

He’s now accusing his former executive, Dan Sargent, of breach of contract and misappropriation of trade secrets over his meetings with another io co-founder.

Scrabbling around the margins trying to recover reputation and value is not pretty.

But could it have been prevented?

Upside – Downside assessment? Possibly the impact could have been reduced by restricting access, controlling tighter with contracts, marking trade secrets, managing internal staff better, but ultimately will the attraction of working with the biggest and best be too much and lead to people dropping their guard and blabbing too much.