Identifying your intellectual
property (IP) and developing a strategy is the first
step when creating a business. Yet, many entrepreneurs
delay even thinking about IP until it’s too late, because
they do not believe they have anything worth protecting.
But this is a mistake.
IP is a significant piece of a startup's value and being
savvy ensures credibility with potential investors and
strategic partners. For example, while patents are not the
only type of IP, disclosing too much too soon about an
invention may dramatically impact the ability to protect
your product. And of course a trade secret only has value
if it’s secret.
Here are three ways to start thinking about protecting your
IP. Keep in mind, I am not an attorney but these are just
insights that have worked for my clients and me. For IP and
other legal decisions, it is best to consult with a
Related: How to
Keep Your Startup's Secrets Private
Start with the name. All companies have
some IP worth identifying. For instance, a company
and its products’ names are valuable assets and critical
building blocks to a brand and therefore, should be
protected. So do your research and secure the rights before
someone else does.
Check search engines, along with state and federal
trademark databases. If the name isn’t taken, it may be
wise to snag it. If you don’t, you may end up either
spending a lot down the road on litigation, securing the
rights to the name or changing the business name or
Don’t rely on a handshake to transfer
IP. Cash-strapped entrepreneurs often default
to working with independent contractors using bids,
estimates or invoices for quick, affordable transactions.
Unfortunately, without a contract, a startup may not own
the work even if the bill was paid in full.
For example, a startup client paid for a promotional video
but worked from an estimate that did not include any terms
concerning who owned the source video files. Inevitably a
dispute arose when the company wanted to make additional
videos and was told they did not own the rights to the
original file and had to pay the video company to
manipulate or buy outright. Moral of the story? Have a
standard contract that clearly articulates who owns what
Related: Will the New
Patent Law Kill the Garage Inventor and
Keeping ideas secret might slow you down. Do not mix up telling someone your idea (which entrepreneurs seem to fear more) with actually leaving valuable IP unidentified and therefore unprotected. Ideas by themselves are not actual IP. It is only after you express those ideas by means of execution that IP is created and must be identified. Non-disclosure agreements (NDAs) may be requested to help ease entrepreneurial angst about discussing ideas. But remember many professional investors will not sign NDAs, because it may restrict other investments. If investors nix the NDA, entrepreneurs should not reveal every last detail at the first meeting without NDA protection. Often enough of your secret sauce can be withheld to protect your IP while outlining your business or product, resulting in progress for your business idea without IP loss. Related: Why Intellectual Property Allows You to Be An Entrepreneur
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