FoMO is described by Wikipedia as
"a pervasive apprehension that others might be having rewarding experiences from which one is absent”. This social angst is characterized by "a desire to stay continually connected with what others are doing". While others defined FoMO as a fear of regret, which may lead to a compulsive concern that one might miss an opportunity for social interaction, a novel experience, profitable investment or other satisfying event. In other words, FoMO perpetuates the fear that we have made the wrong decision on how to spend our time, as "you can imagine how things could be different".What does this have to with trade secrets and investing? The reasoning goes something like this. Investors are supposed to favour as much disclosure as possible about the object of their investment. The securities regulation apparatus put in place was intended to protect the public investor from investing blindly and many a Wall Street or City of London lawyer has enjoyed a well-remunerated life dealing with the minutiae of the disclosure requirements imposed upon public companies. But such disclosure requirements run up against the fact that a hi-tech company may rely on trade secrets as a way to protect its technology. Thus, while a patent, or even a published patent application, can be examined by a potential investor, a company’s trade secrets cannot. The upshot is that the investor is told that the company’s secret sauce is in a black box, which is hermetically sealed from public scrutiny.
This Kat has encountered a variation of the FoMO phenomenon where the investment is private rather than as part of public fund-raising. Even here, the target may limit (or even prevent) disclosure of the inner sanctum of its trade secrets as part of the due diligence process, with the result that the investor remains in the (at least relative) dark about the company’s trade secrets. The target obviously wants the funding, but at what cost to disclosure of its trade secrets? The ultimate investment result may well depend upon how strong is the investor’s sense of FoMO with respect to the investment. When the investor is part of an investment consortium, the potential FoMO-based pressures that may be brought to bear on each other will only be magnified. An investor may choose to invest in a herd-like fashion even when no trade secret is involved. But the presence of the trade secret as a potentially central asset of the company highlights the sometimes uneasy relationship between trade secret protection and other public and private interests.