Starting a new business can be a daunting endeavor. There are many things to consider such as raising capital, hiring the right employees, developing a marketing plan and executing a sales strategy.
One of the most important aspects of starting a business is ensuring the business is legally compliant and protected. Unfortunately, this is one of the last areas considered by startup entrepreneurs. All businesses need consultation to legally organize the business, ensure it is compliant with various governmental entities, review and negotiate contracts and adequately protect the business’ assets.
A very important asset of any business is intellectual property. Intellectual property is creations of the mind, such as inventions; literary and artistic works; designs and symbols, names and images used in commerce. All businesses own some type of intellectual property. For example, it can be a mobile application; a brand name, tag line or logo; or a formula or recipe.
Having a strategy that adequately addresses how to protect and benefit from owning intellectual property is essential to a successful business. Here are three top reasons having an intellectual property strategy is key to any business venture:
1. Insurance: Another business may have priority or competing rights against your company’s intellectual property. This scenario can restrict your company’s growth or result in legal action against your company. It is imperative that companies perform intellectual property searches to ensure they can legally use the company’s intellectual property.
2. Infringement protection: A competing business may decide to use your company’s intellectual property (names, logos, inventions, marketing strategies) as their own due to the fact your company has built goodwill or has developed a strong brand. This scenario can result in lost customers, sales, or business. A business’ ownership of intellectual property gives the business the right to stop infringers and legally pursue infringers for loss income.
3. Royalty income earnings: Licensing of intellectual property is a great source of income for any business. If a business does not own or protect its intellectual property assets, the business can miss out on the opportunity to earn royalty income from licensing.