> This sounds a lot like the unfounded "don't tell anyone your idea, it might be stolen!" fear in Silicon Valley.

Its much different. Mechanical drawings, materials processes, and electrical designs that might have taken thousands of man-hours to develop, test, and refine are actually valuable, unlike "this great app idea I came up with in the shower."

> If you are relying on security through obscurity to protect your business' viability, you're doing it wrong.

Security through obscurity refers to computer security processes. "Business by obscurity" is the industry standard, unless you think Apple, Microsoft, Coca Cola, and Wall Street traders are doing it wrong.

Sure, but even these things are not valuable unless you can actually use them to start a successful rival business within a reasonable amount of time. In other words, if there are 10 idle factories tooled to copy your product for the same price or less and your only security is "nobody else has produced the same ballpark product yet" then you are walking on thin ice (even without internal bad actors), since market demand, reverse engineering and technological change will ensure your current sales run is short-lived. This was my point. Technology businesses often need a combination of reasonable speed product evolution, good client/partner relationships, adequate capital and good name and legal standing to effect a greater sense of business security. A single rogue employee is unlikely to have all of these, and thus appeal to clients.

To look at it another way, if your perspective of evil rogue employees duplicating products was correct, how do you think https://en.wikipedia.org/wiki/YKK_Group survive? There's no crown jewels to walk away with, and there is significant anti-Japanese sentiment from the Chinese government.

Security through obscurity refers to computer security processes

Much knowledge is transferable between different types of complex systems... apologies for not appealing your terminological preference.

In SV the common wisdom is that it's fine to tell people your ideas. But nobody is suggesting you give out your code or your blueprints and designs, and put up a spreadsheet on your website of the contact info for all your suppliers and buyers, and all your customer data.

This story came from a coworker who worked in china trying to make a games business there for a year. I don't know if it was him or someone he knew.

But it's also incredibly inefficient compared to the average 10 person game studio. In the USA, nobody has to do that to make a computer game.

You also missed the part of %80 of the staff walking away to start their own venture.

It turns out the supplier they were working with in China cloned their product and were selling similar cat exercise wheels in China. A second mold was made and used to ship parts back to the US, and that mold was not made to the same quality as the first. At least, that's their story.

Real funny how that international reliability and speed go way up when I have a proxy on. It's almost as if foreign websites are throttled cough cough

> This sounds a lot like the unfounded "don't tell anyone your idea, it might be stolen!" fear in Silicon Valley. If you are relying on security through obscurity to protect your business' viability, you're doing it wrong.

This is completely different. An idea itself doesn't have a lot of value without the business plan and capital to make it happen. The SV narrative is ridiculous because it has people asking for NDAs to tell you about their idea that hasn't even been incorporated yet.

What this person is referring to is the fact that employees and partner companies will take source code, blueprints and other confidential documents and attempt to sell it off or directly start competition. Your secret server sauce could show up at another company with source code, documentation, comments and everything. Many times they'll even use your logos and deliver a lesser product based on your brand name.

Flash memory is a good indicator of this - many chinese manufacturing companies have staff running off-hours manufacturing or pocketing wares that didn't pass QA for later sales. Microcontrollers also deal with this - there are several popular chips (like the FTDI usb<->serial interface chips) that have cheap clones made. Same with basic electronics - think back to all the replacement cables and laptop adapters you've seen with shortcuts taken in the components. There is simply no legal protection against this, and no legal recourse when it's a full company or a former staff member that does it. Especially if your partner is the nephew of a local government official. You wouldn't think it was possible, but corruption is actually worse over there.

This sort of thing happened a lot earlier in US history before corporate and industrial espionage became a thing you could legally sue over. There's actually a sort of industry built around sharing NDA'd spec sheets and documentation over there. Stealing IP is a fact of life. And you can nearly guarantee that the person who does it has a better stable of local contacts than you do.

We're also ignoring the fact that you can't even promise that the work from partner companies meets contractual obligations. Many western companies had manufacturing deals with Chinese electronics manufacturers who delivered inferior (or virus-infected) products. The Chinese milk scandal of 2008 is another sobering story of corruption covering multiple levels. Despite hundreds of thousands of victims, they just tried to ignore it and then buy their way out of it, initially.

> > You need locals to handle staff. You're just a foreigner to be taken advantage of.

> In my experience if you speak basic Chinese, personally hire and manage employees and pay and treat them fairly and offer income security, they will see you working hard and personally work hard and be extremely loyal to you, especially if you offer new skills and challenges.

With some industries, yes. Others no. There's some cultural differences that can cause a lot of friction. Public reputation (face) means a lot to people. But it's more important that others think you're honest than actually being honest. If a person with a strong reputation starts moving against you, in many cases locals and officials will side with them against you in order to curry favor. Favor trading is actually very important when doing major business over there.

It's a market that has a lot of opportunities, but the environment is so different that most attempts at an entrance just end up being swallowed up. Any attempts at redress can easily die an insignificant death mired in bureaucracy.

If you rely on "secret server sauce", you are probably sunk anyway, since a half-decent reverse engineer can probably replicate your business just by looking at it as a black box system from a client's perspective.

Many times they'll even use your logos and deliver a lesser product based on your brand name.

{{citation-needed}}

Think of a program with business logic spanning millions of lines, with intricate detail spent on lots of domain specific automation steps.

At this point I can't help but think that he made an assertion based on a misconception (someone stealing your source code == someone stealing your idea) early in the thread and is just digging himself deeper trying to stick with it.