New or first-to-market ideas and creative expressions of those ideas are drivers of success for businesses in the 21st century. Therefore, protecting intellectual property (IP) assets from unintentional exposure or unlawful use by competitors is becoming increasingly critical for growth and maintaining a competitive edge. Establishing a business requires various types of resources, including networks and financial capital. An intellectual property protection system provides a vital tool to:
- Keep dishonest competitors at bay.
- Establish relationships with employees, consultants, suppliers, subcontractors, business partners, and customers.
- Attract investment capital.
To attract investors, a high-quality business plan that demonstrates your business prospects is necessary. To persuade investors, you must show that:
- There is a significant market demand for your product.
- Your product offers superior quality compared to competing products, if applicable.
- You have taken adequate measures to prevent your accomplishments from being “appropriated” by dishonest competitors.
Most business owners believe that their products are innovative, unique, or superior to their competitors’ products. However, is this truly the case? If you believe so, you will need to prove it, and patents (or reliable patent searches) can be the best evidence of novelty that you can obtain.
Trademarks, trade names, and domain names can be essential elements for distinguishing your products from those of competitors. Therefore, the names you intend to use must be carefully chosen, and the steps to register those names must be included in your business plan.
Furthermore, startup service providers and investors want to ensure that the products you will sell are based on trade secrets, copyrighted materials, patents, or other intellectual property rights of other companies that they do not allow. This is because such risks could disrupt your business operations due to costly lawsuits. In the case of high-tech fields, the risk of infringing third-party intellectual property rights is high, and startup service providers and investors may not be willing to accept these risks unless you can prove that there are no such risks (e.g., through patent searches or trademark searches).
For many businesses, even just confidential business information can be a source of competitive advantage (e.g., product details, secret inventions, technical know-how, financial, and business secrets). In these cases, it is essential to inform startup service providers and investors that your business has exclusive and valuable business information, known as trade secrets, and you have taken the necessary steps to protect this information from employees and competitors. In fact, your business plan is also confidential and should not be disclosed unless “need to know,” and usually only after employees, investors, or anyone else has signed a confidentiality agreement.
In summary, if intellectual property assets are significant to your business (meaning you own patentable inventions, industrial designs, trade secrets, famous trademarks, or if you hold intellectual property rights to copyrighted works), then these intellectual property assets should be critical elements in your business plan. A comprehensive document about the assets and market opportunities of your business should not only list tangible assets (e.g., factories, equipment, capital) but also intangible assets, as these intangible assets are playing an increasingly crucial role in the success of a business in a competitive environment. Any presentation should aim to assert your efforts in managing intellectual property assets and can be a crucial factor in persuading startup service providers and investors of your business’s potential.
