It’s a widely-held belief that small businesses are the main driver of the US economy. Small businesses have a greater ability to create new jobs than middle and large-sized companies. So what is keeping them from protecting their intellectual property? While the federal government has implemented a number of measures to assist aspiring entrepreneurs to start their own business, it hasn’t done enough to educate them on the importance of intellectual property (IP) protection or the value of intangible assets. Below are a few IP-related challenges that US small businesses face today.
Lack of emphasis
It wasn’t until recently that the federal government recognized the need to develop informational tools about IP protection for American companies. This move originated in part from an article written by Scott Baldwin stating that only 15% of US small businesses conducting business overseas were aware that US patents don’t protect them abroad. It would thus seem fair to conclude that US startups are at a disadvantage when it comes to IP protection compared to larger, global companies.
The cost of the different approaches to IP protection
If you plan on entering a new market, find out first which types of IP protection are available. As you might know, the type of protection depends on your invention or innovation. For example, you may file for any or all of patents, copyrights, trademarks, and also use trade secret protection for a particular product. Make sure you have chosen and file for the appropriate protection prior to commercializing your idea.
Limited financial resources
The theft of intellectual property is an unfortunate reality in today’s global business environment. Companies that fail to protect their inventions are subject to massive financial losses. According to the FBI, IP theft costs billions of dollars each year to US companies. Thieves and trolls specifically target startups because of their limited ability to respond legally. Smaller businesses usually struggle to stay afloat financially, especially during the first years of their creation. These fledgling enterprises don’t have the financial resources to file lawsuits against thieves.
Because of the magnitude of intellectual property theft over the past few years, it has been listed as a top priority by the International Trade Administration. This is great news for startups since it means that new solutions to tackle this rampant problem more efficiently will soon emerge. In the meantime, small business owners should ensure that IP protection and strategy is part of ongoing business plans.