Salim Dharssi, Ashlee Froese and Matthew Powell of Gilbert’s LLP explain the different types of IP management and the importance of putting it in place for your startup.
There isn’t one solution that works for everyone, so IP management for startups is dealt with on a case-by-case basis. Our experts discussed the five types of IP: patent, trademark, copyright, design and trade secret. The panel also explained which situations need IP protection and how to keep costs down when you’re bootstrapping.
Your startup may not need IP protection at this point in time, but it is necessary to be able to understand the different types of IP. Using this knowledge, you will be able to determine if any apply to your business. For example, consider whether you need to trademark your brand. Is your brand like the Nike logo, which symbolizes quality and expertise? If it is, trademark your brand now so you don’t need to re-brand later on.
When you’re filing for IP protection, design your application to look beyond the present—consider what the world will look like when you’re successful and people come after your idea. An example of why this is necessary is Moving Staircase: A lack of IP management led to the company’s work only being known by the generic term, “escalator.” On the opposite side is Kleenex; even non-Kleenex brand tissues are often referred to as “Kleenex.” It’s important to consider IP protection because investors value the knowledge that their investment won’t leak away to a competitor.
Often, the majority of the value of a technology or biotechnology company lies in its intellectual property (IP). Startups, therefore, need to take stock of their intellectual property—both to protect it and to maximize its commercial potential. Intellectual property can include patents, confidential information, trademarks and copyright.
In taking stock of intellectual property, look for the following items that you may own now or develop later.
Patents protect inventions. If there is a product or process that is new, is not an obvious invention and has some practical use, it might be patented. It is usually worth getting a patent for inventions that are central to the company’s business goals. This can protect the company’s core business and may provide revenue if other companies need to pay to use your patented product or processes.
Confidential information is private know-how. Keeping a product or process secret—protecting it as confidential information—can be the best intellectual property protection.
Unlike a patent, there is no term for confidential information. As long as it can be kept confidential, it belongs to the company, whereas a patent expires and becomes public property after 20 years. Nevertheless, protection is only available as long as the information is kept confidential and keeping the information confidential could be an onerous task.
A company builds recognition and a client-base for its brand name and the brand of its products. This recognition accrues value known as goodwill to the company. Therefore it is important to protect the names and logo of the company through trademark protection.
Unlike patents, it is not necessary to register a trademark to claim ownership, but you do gain broader protection if you register your company’s name and trademarks. Registration also makes it much easier to challenge those infringing your rights.
Copyright protects artistic works such as books and music. The author has the right to copy and control the work. Copyright protection occurs automatically when the work is put into a tangible form. For high-tech companies copyright is usually given less material value than is a patent or trademark. Nevertheless, copyright can provide an important way to protect ownership of web pages and software.
This content first appeared on MaRS.