Compete with noncompetes

Noncompete agreements are legally binding workplace contracts preventing an employee to work for a competing company after the employment period is over. These agreements commonly prohibit the employee from sharing proprietary information to other parties during or after employment.

In the US, the FTC is proposing new rules with important changes to noncompete agreements. Studies such as the one from the Economic Innovation Group share how as of the year 2014, 1 in 5 employees were covered by a noncompete agreement. Here’s a few of my thoughts on the impact of noncompetes to market dynamics:

The main conclusion here is that Noncompetes hurt innovation, operational efficiencies, and corporate strategy. This was recently highlighted nicely in a February 7th HBR article that I highly recommend.

Happy limitless competing!