I'm a software developer, and like most I work on side projects in my personal time. In theory, one of these may one day be relevant to my own company (especially since I'm more likely to get a good idea based on my own experience).

This got me to thinking, what if I one day had a project which I was starting to sell, which I felt was a good fit to my company: could I sell to my own company, or would that be a conflict of interest?

Note that this is assuming that I'm contractually allowed to work with other companies (or have permission from my current company to have other jobs) and that the software is not competing with my own company in any way. Eg Consider it the equivalent of selling my own version of Microsoft Word to a company which made games. There is no conflict of interest

  • 2
    There is no conflict of interest inherent in this situation, but it is sure fertile ground for one to develop. Also, you need to ask this of an attorney, and you should bring a copy of your employment agreement along for their review. VTC - asking legal advice. Jan 23 '15 at 20:47
  • I'm not really asking for legal advice, more etiquette - would it be considered 'bad form' and sour the relationship? Etc
    – Jon Story
    Jan 23 '15 at 20:48
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    possible duplicate of How do I sell to the company I'm employed something I have previously made
    – user17163
    Jan 23 '15 at 21:26

Generally speaking this is a bad idea. It creates a relationship that is too close. You will get asked, during your day job, to address issues with your software. Now you are working on your side project during your work day.

Eventually, the company could feel this product is theirs since you, as their employee, have worked on it.

It's a slippery slope that is best left alone.

The company I work for explicitly forbids this BTW.

  • I should mention that doing something on the side that doesn't conflict with your day work is a wonderful idea. Confirm your employers policy. Mine has right of first refusal for ideas that could potentially be in line with what we do, but if it's totally unrelated they are OK with side work. Jan 27 '15 at 18:05

If it's a good fit for your company, there are many, many, cases in which your management will think that it was poor form for you to build it for yourself instead of for your employer. However, at a higher level, what you need here is ongoing communication with your immediate boss. Abstract 'étiquette' is far less important here than the views of your immediate management.

If you are starting a new job and own significant personal IP assets, you would be wise to disclose this and clarify, at the outset, your ownership. Make sure that you aren't being asked to sign an agreement that might allow your new employer to claim an interest.

I also think you are underestimating the ability of some people to overreach. Lots of companies do internal development of tools that are not immediately related to the product they sell. If your employer's view, or worse, your employment agreement, says that work you do that is 'relevant' belongs to them, those ideas are much more 'relevant' to the level of ensuing nastiness than your ideas. So best to explore them before they have a chance to bite.

  • I'm mostly imagining a situation where I either already had the project (partial or complete) before working for the company, or where it's out of scope (ie no time to develop it) but I feel it would be useful
    – Jon Story
    Jan 23 '15 at 23:01

Assuming that the company doesn't try to take ownership of all your code, it is likely that the company will not be willing to pay you for the product.

They want to be able to evaluate the purchase of a product or a service as an arms-length transaction. If an employee personally benefits from the transaction there is a risk that the transaction may take place even when there are better or cheaper alternatives. In the future they may have a conflict regarding the product that will spoil your working relationship.

The worst scenario would be if you were involved in deciding how much to spend on the product/service. But even having people you know involved in the transaction decision would not be good. Many companies strictly prohibit employees from also being vendors or subcontractors. They also prohibit vendors from being related to or involved with employees just to avoid these issues.

If you were going to be able to do this you would have to disclose everything to the company before submitting a bid.

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