Why start-ups should focus on protecting their intellectual property
Just like a refreshing breeze on a hot summer day, start-up companies bring fresh ideas and technologies to the market. As out-of-the-box thinkers they play a crucial role in boosting innovation in a technical field. However, starting up a venture is not a walk in the park. Transforming one’s innovative ideas into tangible products or technology platforms comes with numerous challenges. Besides the obvious one of finding sufficient resources, there is the competition from established firms and the uphill battle to claim a spot in the sun.
For all three challenges, protecting your intellectual property (IP) can be a game-changer. IP is not confined to just patents but also spans trademarks and trade secrets. Each of these IP rights plays a vital role in protecting the assets that will make or break the start-up’s journey to success.
Secure your position
Patents grant exclusive rights on inventions in a technical field and give the inventors or patent holders the legal authority to prevent others from making, using, selling or importing their patented technology or product. Safeguarding the start-up’s unique position reduces direct competition from other companies and enables the start-up to differentiate itself from competitors. The latter creates the opportunity to attract customers who are seeking alternative or optimized solutions and thus to claim a piece of the market.
Trademarks are invaluable tools in this pursuit as well, as they grant exclusive rights to use specific names, logos or symbols associated with a company's products or services. By registering a trademark, a start-up can protect its unique brand elements, preventing competitors from confusing customers with similar branding. Brand recognition and reputation strengthen the start-up's position in the market but also attract funding opportunities. Moreover, by registering their trademarks, start-ups establish legal proof of ownership, making it easier to take action against copycats and counterfeiters infringing parties.
For start-ups, attracting investors and securing funding is essential for growth and expansion. Especially in the life science sector, it's common practice that venture capitalists assess the health and depth of a start-up's IP portfolio before investing, using it as a barometer to assess potential return on investment or as ticket to set up R&D collaborations with bigger players in the market. Such collaborations can provide access to additional expertise and distribution channels, enabling the start-up to scale up more rapidly. It can also lead to additional resources for example in the form of licensing revenues or royalties, that can support the start-up's operations and its research and development efforts. Patents should indeed not only be seen as tools to block. They can be a bargaining chip in negotiations with parties that have proprietary technology that your start-up might want to use and vice versa.
Disclosing your invention or not?
A downside of protecting IP with patents is that in return for the 20 years of monopoly the invention should be disclosed in full detail. To overcome this giving away of the finest tips and tricks of your invention, trade secrets might be a valuable option. Trade secrets encompass confidential and proprietary information, such as manufacturing processes and formulations that are difficult to reverse engineer, which give the start-up a competitive edge. It is a cost-effective way of safeguarding IP way much longer than the 20 years of patent life. However, once the information becomes public or is independently obtained by another party there is no legal protection or remedy to re-establish exclusivity.
Your protection matters to us
Patents, trademarks and trade-secrets are of immense importance for start-up companies. Paradoxically, we often see start-ups struggling with the complexity of the patenting procedures and the timing of filing their patent applications. When protection is sought too early there is a risk that the technology or product is not mature enough, resulting in a narrow protection. Importantly, the published patent application can inspire competitors to develop alternatives or optimize the technology and catch up or even worse, take over. On the other hand, investing time in developing less valuable alternatives before requesting protection comes with the risk that somebody else made the invention already and thus that you cannot protect it any longer.
At Brantsandpatents, we care about our start-ups. We want to support them optimally by jointly devising the best strategies to protect their IP, while taking the administrative and procedural work out of their hands, allowing them to channel all their energy into innovation.
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