Intellectual property - a guide for small businesses
Intellectual property law can seem like a bit of minefield for small business owners, especially when just starting out. In truth, however, it's an area well worth being clued up on. When properly managed, intellectual property can offer great benefit to a company and becoming an asset to help it grow. Protecting intellectual property makes it easier to take legal action against anyone who steals or copies it, whilst also ensuring business owners don't unwittingly fall into the same traps themselves.
What is intellectual property?
Defined as something unique, intellectual property must be something physical created by an individual or company; an idea alone is not intellectual property. The law covers everything from books, music and paintings, but can also include software code, website layout and even databases. Methods for protecting intellectual property include copyright, patents, designs and trademarks.
So what counts?
The wonderful thing about copyright law in the UK is that simply by creating the work, it is protected by copyright; a valuable asset which can last for decades. Intellectual property which is automatically covered by copyright can include literary works, art, photography, films, music, web content and sound recordings. Shapes of objects are automatically covered under design right.
When it comes to product names, logos or jingles, all need to be registered as trade marks to protect them. Even colours can be trademarked, as proved by Cadbury when it successfully trademarked its signature purple (Pantone 2685C), but only when used for milk chocolate products within certain categories.
Patents can be applied to cover inventions and products - for example machines and machine parts, tools or medicines. All patents filed, published and granted since 1998 can be searched for online on the Intellectual Property Office archives.
Whilst waiting for registration (unless the property in question automatically protected) it's important to keep everything under wraps! If sharing with a third party is absolutely necessary, a non-disclosure agreement (NDA) can come in handy. This form prevents the person telling anyone else about it or using it for themselves. It is important however to not rely too heavily on the wording of an NDA.
Identifying a small business' intellectual property is an important step and shouldn't be a low priority for start-ups. Many regular viewers of TV's Dragon's Den have seen intrepid start-up entrepreneurs vanquished by a lack of patents, or their insufficient knowledge of duplicate products with existing patents. It shows a lack of protection and for investors this is a real turn-off. After all, why invest in something which could come to nothing if the main selling point is copied or stolen?
Safeguarding against property theft should not be sacrificed in the interest of rushing to get a product on the market. Lack of preparation early on can lead to expensive and lengthy court battles further down the road, which could have easily been avoided. Further, when it comes to trademarking brands it's essential to not only research but also invest in trademarking. Think of the heartache and hassle of completely re-naming and re-branding a company following months of painstakingly building an audience; the results could be incredibly damaging, not just for brand image but profits as well.
Intellectual property can be found in surprising places, so can equally easily be given away. An interesting statistic from Osterman Research showed that 74 percent of an organisation's intellectual property resides in an email or attachment, something which, unless encrypted, is not necessarily as private as one would hope in today's world.
Taking time to assess the company's intellectual assets should be a priority. Simple but effective steps can be taken which do not take a huge amount of effort. Trademark application is inexpensive and relatively simple, and can be done via the government website. Adding a copyright notice to websites and key business materials will also warn off competitors, showing the company has rights over the content. Plus, don't forget to make use of non-disclosure agreements early on.
Rights and rules vary from country to country. It is typically easier to get a piece of work registered under property laws in the US. That said, the UK Intellectual Property Office is an excellent source of information, with useful guides and tools aimed specifically at supporting small businesses in identifying, protecting and growing its property assets. Many of the tools are free to use and well worth looking through.
It is also essential to be aware of the rules and regulations for intellectual property for the countries in which a firm is expected to trade. Get ahead by applying for patents in the necessary countries as soon as possible.
Know your intellectual property!
Don't give away an asset as important as intellectual property. Following these guidelines can help to ensure your company is protected, giving it the best chance to succeed in a competitive market.