STARTUPS & IP
An advice piece by Laura Moreno Sosa
I have recently been talking to a friend, founding partner of a successful global startup, about the level of importance his company gives to Intellectual Property (IP) protection. It came as no surprise to find out that they really do not pay much attention to it since they are more focused on establishing a lucrative company in order to sell it, make a profit, and move onto the next project.
The low priority to safeguard IP early on, which I suspect is common to most startups, is very menacing to the valuation of the company.
Next, I would like to offer what I consider to be the most important aspects of IP that should be considered as early as possible in a developing business.
1. Identify your intellectual assets
It is very important to understand the different types of existing IP protection for the different types of intellectual creations within a company. In order to secure a startup’s IP it is very important to get proper counsel that can help recognize the value IP can bring to the company.
The proper timing to move forward with a comprehensive protection of the startup’s intangibles is yesterday. Seriously!
Investments on branding, signage, product packaging, etc., can be completely lost if they are made without first securing rights to a name, trademark, trade dress.
It is important to avoid the release of a new product without protection, which can result in publication and movement to the public domain of an innovation (Enabling Public Disclosure). This causes immediate devaluation of the startup worth as a consequence of not protecting the intellectual creation in due time.
Startups should consider every country in which the company has operations in order to protect the IP within every relevant region. Intellectual Property rights are granted per country and/or per region.
4. Formalization of business relations
It is very important to formalize each and every relation involved in the development of the products of the company. This is the only way to ensure the protection of the intellectual creations, guarantee confidentiality and shield trade secrets.
Depending on the industry, there are several kinds of protection that may be appropriate. It is of the utmost importance to draw out an intellectual property strategy as soon as entrepreneurs begin building the venture.