Intellectual property (IP) is a term that is used to describe creations of human intellect. So, although they are intangible (in the sense of not being physical) they are seen as one of the most valuable assets of a business and critical for success. In fact, with today’s technological advancements, for most major businesses, the value of intangible assets (such as brand and reputation) is five times greater than tangible assets (like real estate and equipment.)
Unfortunately, start-ups often put IP at the bottom of their to-do list, figuring that it can be sorted out once the company grows, due to the money and time it demands (especially when it comes to international IP protection). But in all honesty, you do not need a large budget to accommodate such costs, a few small fees and some legal research can effectively cover the basic domestic IP protection necessary.
Besides, safeguarding IP is much easier in the starting phases than after the business becomes successful. If you think about it, the incentive behind a start-up at first is just a novel idea. But executing that idea successfully in the practical world is what transforms the small start-up into a large-scale corporation. The objective of intellectual property laws is to protect those initial ideas that underpin your start-up. This will strengthen your competitive advantage, as potential investors will be attracted to how consistent your IP protection is. It is this protection that will act as leverage in assuring them their money is going to an idea that is new to the market and has a promise to excel. So not only does IP grant you legal stability but raises the commercial value of your business too.
Of course, the other side of this matter is equally as important- researching IP matters ensures you do not mistakenly infringe existing companies’ rights. A pivotal step in the IP process requires searching for companies that already own a monopoly over inventions or trademarks that you seek to claim. Discovering this early on can save your start-up from expensive infringement claims later down the line after you have already invested money and time into developing the idea on your own.
To start you off, the basics examples of what start-ups usually seek protection for include, inventions, logos, business names, and software. Different types of IP protection apply to each: patents would protect an invention, copyright protects software, and trademarks would protect your brand name and logo.
Also, don’t forget to make sure you have ownership of the IP in everything created for your business. It may seem obvious, but this is often overlooked. Typical examples include the rights to the work created by your designers, or the logo created by the freelancer you hired. An easy way to ensure this is to confirm that your service contracts with employees, consultants, agencies, and anyone else applicable all contain an intellectual property assignment clause that states any IP rights in the work created, are automatically assigned to you.