As we have written about before, for many businesses, especially startups, intellectual property (IP) is their most valuable asset. If your company has created a unique product, technology, or service, protecting the intellectual property you have developed is paramount to your success. Both the company's founders and investors must ensure all IP is first identified and then protected through agreements and registration, while also avoiding infringing on the intellectual property of third parties.
Here are 5 of the biggest IP problems for companies and their solutions.
1) Not Considering an IP Protection Strategy
Your company's most valuable asset is its intellectual property. Whether in the form of a service, software, or new product, the bottom line is founders need to work hard, early on, to identify all of their IP needs.
Many companies fail to understand there is no one size fits all regarding IP protection. For instance, trade secret protection may be more effective to protect software than a copyright or patent protection. Therefore, do the research and work alongside an IP professional to develop an effective and reasonably priced strategy to protect your IP assets.
2) Breaching Another Company's Trademark
Another big mistake companies commonly make is infringing on another company's trademark. Any word, name, or symbol that distinguishes a company or product from another is considered a trademark. Brand names such as Google, Amazon, or Sony are all trademarks. Just because a startup can register a domain name doesn't grant them the rights to use another's company's trademark. If a startup uses a name similar to a name or symbol used by another company, there can be legal repercussions.
Your company should at least do a search on not only the USPTO site but also search engines to determine if a word, name, or symbol will inevitably infringe on another company's trademark.
3) Failure to Use and Implement The Right Contracts
It's safe to assume that many startups have an informal atmosphere. While great for collaboration, it could cause problems in the future if certain formal requirements are not fulfilled. Companies need to set legal agreements in place with respect to IP among the founders, employees and third-party vendors/contractors. This will protect intangible assets of an organization. Here are some questions to ask:
- Who owns the intellectual property?
- Have employers and vendors signed a confidentiality or invention assignment agreement?
- Are you hiring a vendor to solely manufacture your product or technology, or are there other agreements?
- In case of any IP infringement, who will bear the legal costs?
4) Registering Their Trademark After The Company Grows
Your company trademark should be registered as soon as possible. The name of your brand is a valuable property, and should be considered when planning your IP strategy. Take Nike for example. Today, the Nike swoosh is worth over 13 billion dollars. The creator, Caroline Davidson, handed it over for just 35 dollars. Today the logo is the most well known in the world. People all around the world know the Nike symbol and buy from the company for that reason alone.
Your trademark is an important part of your branding, and so you should not underestimate it's importance.
5) Waiting Too Long To File Patent Applications
When it comes to intellectual property, skimping too much in the beginning could be damaging in the long term. Companies have tight budgets and would rather spend it on marketing and customer acquisition, than ensuring their ideas are protected. A large portion of the innovative IP is produced in the early days of the company, as it's usually the idea itself that makes entrepreneurs want to start the company in the first place. Therefore, it's important to invest in a reasonable amount of resources in the beginning or at least have a strategy.
However, do not ignore your innovation as you build the company!
To learn more about Traklight and IP strategy, contact us to speak with one of our professionals. Better yet, start on your own and be done in 10 minutes with the free Business Risk Assessment.
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